When "Finding Nemo" sold 22 million DVD copies when it streeted at the end of 2003 to become the best-selling DVD of all time, that was incredible.
When "Shrek 2" sold 12.2 million copies in its first weekend of release starting Nov. 12 and looked ready to knock the clown fish out of the top spot, that, too, was incredible.
For supermarket retailers looking to reap the benefits of those kinds of numbers, 2005 shapes up as an Incredible year.
The Pixar-Disney collaboration "The Incredibles" grossed $143.2 million at the box office in its first two weekends in theaters in November, and is expected to be released on DVD and VHS in April 2005. The early box office numbers point to another big hit, and that will catch the attention of retailers as they look toward 2005. Leveraging the supermarket's unique mix of kids, parents and store visits will bring in not just the dollar sales from the DVD itself, but the cross-promotional opportunities that studios are increasingly using in the supermarket channel.
"I know there have always been cross partners and I see this continuing since it benefits both parties involved," said Bob Gettner, video buyer/coordinator, B&R Stores, Lincoln, Neb. "Exposure is brought to both items. There are new partners all the time. Vendors that you would not expect to tie in with a movie are now looking to do so."
A promotional deal between Albertsons and Pepsi drove customers to earn a free copy of "Shrek 2" with $100 in Pepsi/Frito Lay product sales during the promotional period. "This was a highly successful promotion. Expect similar marketing initiatives in 2005 and more cola tie-ins, which are extremely successful," said Bill Bryant, vice president, sales, Ingram Entertainment, La Vergne, Tenn. "Some supermarkets are taking a very aggressive stance with new releases."
For the holiday season, Albertsons has a similar model tied to "Mickey's Twice Upon a Christmas" from Buena Vista Home Entertainment, Burbank, Calif. In the promotion, Huggies, Disney (parent of Buena Vista), Gerber, Enfamil and Kodak will award more than $5,000 in prizes to customers of Albertsons and the various banners it operates. "A 360-degree marketing plan was developed with Albertsons and our partners, which includes multiple ads, direct mail, custom Disney shippers, a consumer sweepstakes, in-store promotional materials and public relations," said Jana Collier, customer marketing director, Kimberly-Clark, Dallas. "There are very high expectations."
The opportunities aren't limited to the national chains, said Sean Devlin Bersell, vice president, public affairs, Video Software Dealers Association, Encino, Calif. "We believe the possibilities are endless -- whether it's at the national level or through clever cross-promoting between retailers or suppliers on a local level."
The family video market continues to hold strong, and while studio video releases seemed to be timed to precede the holidays rather than to take advantage of DVD players purchased as holiday gifts, there will still be several impressive titles released in the first half of 2005. Among them will be the Tom Hanks movie "The Polar Express," which turned in $23 million in its first weekend on the big screen, and the "SpongeBob SquarePants Movie" for the younger set.
The kidvid market continues solid. "Children's releases continue to sell well, with certain franchises excelling," said Bryant. "The Dora [the Explorer] franchise will continue to perform well and 'SpongeBob SquarePants: The Movie' will be a major children's release in 2005."
"There are so many items released for kids all the time," added Gettner. "The sell-through market always has something out that is kid-related and that keeps driving the consumer back into the store."
Bersell noted that the growth in children's DVD sales is tied to television and cable programming, not first-run films. "In 2003, 4% of the DVD titles released were non-feature children's programming," he said. "At the end of October of 2004, 4.5% of DVD titles released were non-feature children's programming."
A growth market for the parents seems to be the proliferation of television series old and new being released to home video. Even with popular TV releases such as "Seinfeld" and "Friends" coming to home video, supermarkets have been slow to include these in the mix. The price points are higher, but retail experts still see potential.
"Some supermarkets are experimenting with TV product," added Bryant, "and chains that merchandise it properly can create incremental sales and profits."
One key to the continued growth in the market will be to turn such experiments into nimble marketing opportunities. "Speaking from experience, supermarkets that are still doing video obviously have changed with times and adapted to the market," said Gettner.