SHARED-REVENUE HELPS BOOST 'FATHER OF BRIDE II' CELEBRATION

DAN ALAIMO

Supermarkets stepped up their use of shared transaction fee programs with the rental release of "Father of the Bride II." The family-themed title, released last month, came out at a time when many retailers were being added to the ranks of those testing or rolling out the shared-revenue systems. Among them were Dierbergs Markets, Chesterfield, Mo.; Martin's Super Markets, South Bend, Ind.; Copps Corp., Stevens Point, Wis., and K-VA-T Food Stores, Grundy, Va. Deep discount drug chain Phar-Mor, Youngstown, Ohio, also rolled out shared-revenue in June, said distribution sources. For most of these retailers, this meant significantly increased depth of copy and heavier promotional activity. For some, it also was a chance to try guaranteeing the availability of the title, where the retailer offers a free rental if the movie is not in stock. These promotions typically run for several weeks following street date. " 'Father of the Bride II' was a very solid title and we were able to carry larger quantities than we would have in the past because it was a SuperComm title," said Tammy DeCloedt, video merchandising associate at Martin's Super Markets, South Bend, Ind. June was Martin's first month using SuperComm, and "Bride II" was the first major title with the program. "At this point, it looks like it serves its purpose. We wanted depth-of-copy and we're not paying a small fortune for it," DeCloedt said. Martin's might try a guaranteed availability promotion once it gets more experience with the shared-revenue system, she said. A guaranteed availability program on "Father of the Bride II" is meeting expectations, said Jamie Molitor, director of video operations at Dierbergs Markets. "But I had very high expectations. So far it's doing real well," she said. This was Dierbergs' first title with the SuperComm program, which the retailer is testing, she noted. With it, she is hoping to attract new customers and video members. "I'm certainly satisfying more customers with new releases," she said. In one store, the chain has 120 copies of the title, she said. K-VA-T tested shared-revenue in the past and discontinued it because its point-of-sale system was not sophisticated enough to adequately track transactions electronically. With a recently updated POS system, the retailer added SuperComm to all its video rental departments last month. "We brought in three times as many copies per store as we would if we bought it through regular distribution," said Brenda Vanover, video coordinator and buyer. K-VA-T plans to try guaranteed availability once its schedule of store openings slows down, she said. Promotion for "Bride II" included in-store ceiling danglers and radio ads, she said. With shared-revenue, "we hope to increase our revenue and have the movies available for our customers so they don't have to go somewhere else to get them," said Vanover. Nash Finch Co., Minneapolis, which rolled out the SuperComm program to all 38 of its corporate stores with video rental departments last fall, continued its monthly guaranteed availability promotions with "Bride II," said Clifford Feiock, video coordinator. "We've got 40 to 50 copies in a lot of the stores and it is renting like crazy," he said. Giving away an occasional free rental is a small price to pay for the promotional benefits of the program, he said. "On the weekends, we may run out of product in a few stores and have to give away a few free rentals, but that is OK. The program has been very positive," he said. "We are starting to gain our customers' faith that we will have the extra copies on the weekend when they want to watch them. That's what it is all about," he said. Feiock is expecting a big rental month in July when Nash Finch will guarantee availability on "Mr. Holland's Opus" and also have titles like "Broken Arrow" to rent. The majority of chains contacted by SN got "Father of the Bride II" from SuperComm, Dallas, while one -- Harps Food Stores, Springdale, Ark. -- used Rentrak Corp., Portland, Ore. SuperComm and Rentrak are the only two suppliers offering hit videos to supermarkets on a shared transaction fee basis. Harps ran a guaranteed availability promotion on "Bride II," as well, said Randy Weddington, video specialist. "I was very pleased with the results," he said. "In most of our locations, no one else is doing guaranteed availability, so it is a way to distinguish ourselves. Even where other people are doing it, it is still about the only effective tool we have to combat them," he said. As a result of using the Rentrak system, Harps rental inventory is expanding and Weddington has been looking for new fixtures that will hold more tapes. "The increase in business that Rentrak is bringing about justifies putting more tapes in. Rentrak has been a big shot in the arm for us," he said. In stores where Harps has been using Rentrak for a while, "our volume is up 35% to 40% over what it was," said Weddington. With the shared transaction fee programs, retailers pay a fee of $10 or less to acquire a tape, and then share the revenues about 50-50 with the supplier. Otherwise retailers pay about $60 to $70 for a new release tape they would own. Transactions are tracked by the video point-of-sale system. Most retailers take advantage of this pricing structure to bring in much greater depth of copy on the hits and more breadth on B titles. Among the other companies known to be using these programs are Coborn's, Dillon's, Fleming, Haggen, King Soopers, several Kroger divisions, Marsh, Pathmark, Price Chopper, Randalls and Safeway. " 'Father of the Bride II' was just the right title at the right time" for many of these retailers, said Des Walsh, vice president and general manager at SuperComm. SuperComm is a subsidiary of Walt Disney Co., Burbank, Calif. "Bride II" was released June 11 by Buena Vista Home Video, Burbank, another Disney subsidiary. "Bride II" will be followed by "Mr. Holland's Opus" in July and "White Squall" in August. "These titles, the summer rental period and guaranteed availability add up to a powerful combination that seems to be creating a surge behind the concept of guaranteed availability," said Walsh. "Guaranteeing the availability of selected titles is an exceptionally powerful promotional message that is being aggressively used by many retailers to attract inactive members. The result is a new excitement about the concept of video rental," he said.