ST. LOUIS -- With 15,000 titles available on DVD and counting, retailers are playing a guessing game with space allocation and copy depth as studios release duplicate versions of titles on DVD and VHS.
Some retailers are making room for the new format by decreasing their stock of older titles, and all are finding that they must evaluate each title on a case-by-case basis to determine the right mix of formats to offer.
"It's not really a formula," said Denis Oldani, director of video at Schnuck Markets here. "It depends on the month, what's available. You have to look at the genre, you have to look at the actor, you have to look at the stores you're putting them into and make a determination."
He said that as the ratio of DVD-to-VHS increases, he's relying on recent rental-history data to determine the best mix of formats to offer.
Martin's Super Markets, South Bend, Ind., recently expanded its DVD section from 4 feet to 12 feet, eliminating roughly 10% of its VHS catalog section to accommodate the new format, according to Laura Fisher, video-rental supervisor for the retailer.
Sales have increased about 20% since enlarging the DVD selection, she said.
"We've got something for everyone. We still have consumers who haven't purchased a DVD player, and some consumers who have both a DVD player and a VCR," she said.
Martin's displays DVD catalog and new releases together in stores, separate from the VHS new release wall and the VHS catalog "islands" in the middle of the store sets.
Fisher said action titles like "Pearl Harbor," "Training Day" and the upcoming "Ali" are more popular in the DVD format, and the retailer offers more copies of those titles in DVD.
Other retailers strain to come up with the right product mix.
Albert Lees, owner, Lees Market, Westport, Mass., said, "We've been having problems keeping up with who wants what. We're like everyone else, struggling with what types of video or what categories of video work better in which format."
He said he keeps the VHS and DVD sections separate.
Mike Gorman, research analyst, Alexander & Associates, New York, said retailers struggle with copy depth, noting that 33% of households now own DVD devices.
"It's tough to balance -- it's case-by-case for each retailer," he said. "You don't want to alienate VHS customers."
According to Chris Roberts, vice president of sales, Rentrak, Portland, Ore., retailers typically offer seven VHS copies of a title for every three DVD copies.
However, he said that "more and more retailers are bringing in comparable quantities of both formats, and some retailers are bringing in more copies of DVD than VHS."
The increased availability of DVD catalog titles also is driving rental revenues.
"It's becoming more of a rental business rather than a sell-through business, like it was in the beginning," Roberts said.
Oldani pointed out that the lower prices retailers pay for DVDs have helped video specialists keep enough copies in stock.
