BROOKINGS, Ore. -- C&K Markets here began testing the pay-per-transaction shared-revenue system of Rentrak Corp., Portland, Ore., last month, said Larry Hage, division supervisor/video buyer.
The retailer started with the rental title "Shakespeare in Love" in six stores. "It's becoming really clear that if you don't have lots of titles, you are not going to make it in this business. We have been buying in the conventional fashion, and the No. 1 complaint that we get from our customers is, 'you never have it when I come in to get it,' " he said.
To maintain its customer base and attract more business, C&K planned to do some heavy advertising to let people know that it has lots of copies of key titles, he added. "We are going to run ads in the paper, and promote and promote, and see what happens," said Hage. Other promotional vehicles will be through in-store announcements and radio ads, "all based on the theme that we've got lots of copies," he said.
C&K is starting off with 14 copies of "Shakespeare in Love" in each of the test stores. "That was Rentrak's recommendation. We may find that 14 is not enough. To a certain extent, I am really putting my faith in Rentrak, and it certainly is going to behoove them to help us be successful in these first test stores," he said.
Rentrak, he said, "looks good on paper, so we are probably going to have a little bit of a transition with our customers to win them back and convince them that we've got what they want," he added.
C&K has 28 video departments in its 42 supermarkets and continues to put rental into all new and remodeled stores.
"We are staying committed. In any remodel activity that we do, we are involving video," said Hage.
The retailer has added four stores this year through acquisitions, but only one was big enough for a video department, he said.
Three new stores are planned through April of next year and all will have video.
Hage has seen the reports saying that supermarkets are getting out of video. He also saw a recent quote from a Warner executive saying that supermarkets could be the "big dogs" of video.
"We are not getting out of the video business, plain and simple. So, because we are staying in it, we have to take another look at how we are going about the business and see if we can enhance our position," Hage said.
He noted that many of C&K's stores are not in areas with Blockbusters.
C&K is having its best year ever through the first six months of the year, he said. But this is not true for video.
"In video, we are struggling to keep sales and margins up. We feel like Rentrak is the direction we need to go to do this. You can't rent it if you don't have it," he said.
