Repriced, previously viewed videos can provide supermarkets with future revenues.
In addition, it is a quick, easy way for retailers to weed out slow-moving titles.
"We find that customers are more apt to buy a used tape than a new one if they can save a few bucks," said Carl Johnson, video specialist at Harp's Food Stores, Springdale, Ark.
Harp's blends previously viewed tapes with its rental titles. The titles are identified with stickers that notify customers the tape is available for purchase. "Keeping it in the rental section allows us to continue making money on it until it is sold," he said. Between 20 and 50 previously viewed tapes, which run from $4.98 to $19.98, are sold each month in each of Harp's 17 video departments.
Angeli Foods Co., Iron River, Mich., carries previously viewed titles in three separate sections in its stores. The mix includes a wide range of popular releases, such as "True Lies," "Dumb and Dumber" and "The Specialist." While these titles sell quickly, other titles reap even higher profit margins, said Denise Hasenfus, video manager.
Hasenfus said there's a large market for repriced action movies, along with classics and sequels to classics. She said rentals like "Scarlett," a six-hour television sequel to "Gone With the Wind" recently released to video, have a wide appeal among consumers when repriced.
"If they ever reprice 'Scarlett,' I'm sure it will do well," Hasenfus said.
The bottom line, though, is how well a video is made, Hasenfus said. If a video has a good reputation and a strong following, it most likely will be a sell-through hit, she said.
Previously viewed tapes can also be successful if the right types of titles are merchandised. Angeli Foods promotes previously viewed sell-through tapes by allowing customers to reserve copies at the time a title is put on the shelf. For example, when "Forrest Gump" was released to sell-through, the retailer put up signs that read, "Reserve Your Previously Viewed Tape of 'Forrest Gump' for $9.95."
"We do very well with previously viewed tapes. When a video is first released, we already have people signed up for the previously viewed versions, even though we won't pull it for another five months," she said.
Under Angeli Foods' previously viewed program, customers pay for the movie when they reserve it. They are given a proof of purchase and are called within a month or so when the tapes become available.
"These videos are basically sold before they're even previously viewed," she said. "The customers pay in advance, so we already have the money."
Last December, Jordan's Shur-Sav, El Paso, Texas, installed a 2-foot-round wire rack near the main video checkout counter at both of its stores. The unit is used exclusively for repriced merchandise, according to Liz Montoya, video manager. The racks feature about 12 titles, which usually sell down every two weeks.
The unit displays new releases -- such as "True Lies," "The Lion King," "Mighty Ducks" and "Beverly Hills Cop 3" -- as well as older titles. Price points range from $4.95 to $9.95, depending on the title.
Montoya said the section is an easy way to get rid of slow-moving rentals, which normally would not bring in significant revenue.
"After a rental has been on the shelves a while, people have viewed them, so people stop watching them," Montoya said. "It's better to sell them than to keep back-stock; it lowers inventory."
Johnson of Harp's Food Stores said each video is closely monitored to see how it is renting.
"We look at the title's performance during a six-week period, and if we find that it's only been renting three times a week, we'll make it available for sale," said Johnson.
J.M. Bauersfeld's, Topeka, Kan., displays about 16 to 25 repriced videos with its sell-through videos. The section, which is promoted with in-store signs, features plenty of children's and action titles, according to Kathy Sobke, video buyer. The repriced assortment usually sells down within seven days.
Previously viewed tapes are carried periodically, positioned in sell-through and also placed in baskets throughout the department. Like Angeli Foods, J.M. Bauersfeld's allows customers to reserve movies.
"As soon as we get the list of movies that will be repriced, we let our customers know," Sobke said. "This way, by the time it's released, we have most of the extra copies sold."
Community Cash Stores, Spartanburg, S.C., doesn't carry a large assortment of repriced merchandise, but tries to display several titles. The retailer feels it's important to have at least some type of selection, according to Jim Key, nonfood direct-store buyer.
"We try to take advantage of the latest repriced movies because anytime you can offer your customers a savings, it will help sales," said Key.
Sak-N-Sav, Houston, is expanding its repriced selection, according to Bill Liesenfeld, nonfood buyer, to meet the growing trend of families starting video libraries. "I think people want to have something they can watch over and over again, especially for the kids," Liesenfeld said.
The retailer recently added 135 titles to its collection of 80 to 90 repriced sell-through titles that are sold in all three of its video stores. The new merchandise, which is priced between $6.95 and $12.95, is displayed on endcaps.
Repriced videos at Boogaarts, a chain of stores operated by Fleming Cos.' Kansas division, Concordia, Kan., haven't always been successful, but sales have begun to pick up, said Matt Dillon, video buyer.
As for previously viewed merchandise, Boogaarts features about 150 to 200 titles in each of its stores. Most of this merchandise has been purchased from other retailers, including Hy-Vee Food Stores, West Des Moines, Iowa. Indeed, Boogaarts buys about 1,000 previously viewed tapes from Hy-Vee every two months. The majority of these titles are sold for $9.95.
