HOUSTON -- Randalls Food Markets here is running a huge rental promotion this month focusing on the title "Die Hard With a Vengeance." Guaranteeing the title's availability, the retailer put as many as 120 copies in some stores, said Dorothy J. Jones, buyer and merchandiser for service center, video. The promotion involved heavy use of radio advertising, along with point-of-purchase materials and print ads. "We want customers to know that Randalls has lots of copies, and that when they come into Randalls, they are going to be able to find what they are looking for," said Jones. This kind of promotion helps establish Randalls as being in the same competitive league as video specialty chains like Blockbuster and Hollywood, she said. Randalls acquired the title from shared transaction fee distributor Rentrak Corp., Portland, Ore. The promotion began on Dec. 27, 1995, a week after the title's street date. It continues through this month.
In the promotional materials, Randalls said the "Die Hard" title would be "Guaranteed to be here, or rent for free!" Customers were offered a free rental of any other title, including new releases, if "Die Hard" was not in stock, said Jones.
But the retailer has given away "very few" free rentals, she noted. "The numbers we ordered were very good. We were able to supply our customers' demands," she said.
The 49 Randalls stores in the Houston area with video rental departments that are running the promotion carry between 35 and 120 copies, she said. Randalls' Tom Thumb stores in the Dallas area were not part of the promotion. Some retailers have questioned the profitability of guaranteed availability programs. They have said that bringing in mass quantities of titles may create an effective promotion, but with little additional margin. But Jones said, "If you buy right, it is very profitable." Because of the traffic and volume driven by the high level of promotional activity, "it is really more profitable" than buying the title through traditional distribution, she said. Andy Miller, national sales manager for Rentrak's supermarket division, said he could not reveal any specific numbers about the Randalls "Die Hard" promotion. "But the numbers are astronomical," he said. With shared transaction fee programs -- also known as pay per transaction -- retailers pay a $7 to $12 fee to acquire a tape, and then share the revenues with the supplier. This can be an alternative to paying as much as $70 or more a copy for some titles and allows the retailer to bring in specific movies in much greater depth. Revenues are tracked electronically. This is the third guaranteed availability program Randalls has run with Rentrak. In the last year, it has run the promotions on "The Beverly Hillbillies" and "True Lies," said Jones. All are FoxVideo titles. Of the three, "Die Hard" has done the best for Randalls, she said. Randalls is getting products from both Rentrak and SuperComm, Dallas, another major shared transaction fee distributor. But it has only been running the guaranteed availability promotions with Rentrak.
SuperComm, a Disney subsidiary, emphasizes in-store promotion, noted industry observers. Rentrak worked closely with Randalls to develop the promotional campaign, which focused heavily on radio, noted Miller. Four different radio stations did remotes at Randalls stores and a radio spot was created specifically for Randalls, he said. The 60-second ad was set as a simulated traffic report, which predicted severe driving conditions while Randalls ran the "Die Hard" promotion. The guaranteed availability offer and the retailer's rent-one, get-one-free Wednesdays were highlighted over the background of car and traffic noises. Randalls personnel wore "Die Hard" T-shirts, and stores were decorated with large banners and balloons, said Miller. Radio giveaways included movie-related trinkets and memorabilia, and Randalls gift certificates, he said. Bag stuffers, and print ads in the newspaper and Randalls' circular also were a part of the campaign.
By waiting a week after the street date of "Die Hard With a Vengeance" to start the heaviest part of the promotion, Randalls was able to maximize the benefits of the program, said Miller. The tapes and signs were in the stores during the first week of release and the copies turned rapidly without additional promotion, he said. "Then the media kicked in during the second week, and that's when the marketing helped the turns the most. If you did the same thing during the street date week, they'd be giving away movies left and right," he said. "The most successful promotions I've done, with the best numbers and the highest level of excitement, have been with radio," said Miller. There are other benefits of doing this kind of promotion, he added. For example, another retailer signed up 680 new members for its video program in one store in one week during a similar promotion, he said.