VIABLE VIDEO

MARY ANN FARLEY

SPRINGDALE, Ark. -- From kindercare to Hollywood excitement, Harps Food Stores, based here, sets itself apart from the competition through its video departments.

A kindercare center placed in the Mount Home, Ark., store is an example of how Harps will continue to compete in its marketplace and offer its shoppers value. Currently, the kindercare center -- a carpeted area complete with a babysitter, a VCR and TV, coloring books and toys -- is located in the video department, offering customers a place to leave their children while they shop.

"We aren't saying that we'll babysit your kids for the day," said Craig Hill, the chain's director of video, "but we will watch them while you shop. We'll give them some popcorn and play a popular movie, which we hope the kids will insist that Mom rent on the way out."

Hill sums up the key to Harps' continuing success. "We've been successful because we've combined product availability and the right price at clean, safe locations, backed by friendly, helpful, knowledgeable personnel. We intend to remain a vital part of an ever-growing and changing successful grocery chain."

As it stands, Hill sees Harps as serious competition for all video stores -- large and small -- in his areas. And he takes his lessons wherever they present themselves.

"Stores like Wal-Mart don't rent," he said, "but they have made us re-evaluate our sell-through strategies. Our previously viewed tapes, for example, have remained very profitable and well-received. Also, our game and accessory inventories have helped us offer the consumer a product and value that is as good as or better than any of our competitors."

When customers walk into Harps' video departments, they don't feel like they're in an ordinary supermarket video section. They feel like they're in a video specialty shop, and with good reason. Original displays abound, obscure titles share shelf space with blockbusters, and a friendly staff passionate about movies is ready to answer any question about any film.

Hill said it's all part of his plan to generate genuine Hollywood excitement not only among customers in the 42-store chain's 20 video departments, but among the staff, who regularly compete in best-display contests. The winner gets $25.

"In all departments, Harps really emphasizes displays," he said. "For example, when 'Toy Story' came out, the characters were on cereal boxes, so we brought those boxes into the video department and built a display. We've actually won a lot of awards for these things." His staff will also do smaller displays in other departments to entice customers to come and rent a movie.

"Our video departments definitely operate more like video specialty stores," he said, "and so far it's working. We do a lot of broad-range purchasing, but we also do a lot of specific purchasing for the demographic that each store serves. Some stores have a large Native-American clientele, while others serve large Latino communities. There's a lot of pressure on store managers to cater to their customers, but we pay a great wage. It's a lot of responsibility."

The video departments carry anywhere from 1,200 to 8,000 videos, 150 to 650 games, and 50 to 200 DVD titles. Other rental products offered include VCRs; game systems such as Nintendo 64, PSX and Dreamcast; DVD players; music DVDs; and some audio books. Sell-through is strong in each location -- so strong, indeed, that customers have come to know Harps as the store where one can find the most obscure titles available. For example, one location recently ordered 'The Autobiography of Ayn Rand' for a customer and had it within four days.

"With everyone grabbing a share of the rental business, you have to sell stuff," Hill said. "As long as the title a customer wants is stocked by WaxWorks or Ingram, we'll generally have it in a day." Harps acquires product from WaxWorks/VideoWorks, Owensboro, Ky.; Ingram Entertainment, La Vergne, Tenn.; and Rentrak, Portland, Ore.

Since taking over the video-director's position two years ago, Hill said, he' s had a number of challenges in bringing the departments up to speed. One has been finding -- and keeping -- qualified store personnel. In such a tight labor market, he said, it's been difficult to find knowledgeable employees, but the effort has paid off.

"I credit our success to our staff," he said. "Personally, I'm an avid movie-goer. I read all the reviews, and so do my employees. In fact, a number of them work at other video chains at night, so they know what's good. If I'm interviewing someone for a clerk's position and they tell me they don't watch movies a lot, they find employment elsewhere."

Hill also credits Harps' success to its "Hot Picks" of the month, which vary at each location. Basically, each department observes what titles Blockbuster is promoting heavily in its television advertising, then chooses three different titles as its Hot Picks.

"Since everyone sees those Blockbuster ads, there's no reason for us to reinforce those titles," Hill said. "People already know about them, so we'll choose three others that maybe they wouldn't necessarily think about renting." For example, Harps is currently touting "The Straight Story" as a Hot Pick, which Hill said he believes is perfect for supermarket customers.

Hot Picks can vary store to store, but "The Straight Story" is one title that will be promoted in each video department. "It's a wholesome movie -- rated G -- that we know will do well in the whole chain," he said. "We like promoting these lesser titles that we know people ought to watch."

Hill said he's taken his cue from video specialty stores in other ways as well. New releases rent for two days, and catalog titles are priced at "five movies, five days, $5." There are also monthly specials, such as 39-cent comedy rentals, or a "one chick flick/one guy flick" combo for 99 cents. Most departments offer a "Baker's Dozen" promo, in which the customer gets a 13th rental free after renting 12 videos.

"We also emphasize that we sell chips, popcorn, movie-size candy and all size sodas in our video departments at grocery-store pricing," he said. "We've begun selling previously viewed movies, which have been a particular hit in our country areas. To those customers, there is nothing better than a good, clean, shrink-wrapped pre-viewed movie, which we sell moderately priced and guaranteed."

Harps purchases thousands of used movies from select wholesalers or from competitors going out of business. Stock is rotated every 15 to 30 days, so customers know that should they see a title they like, they should buy it as it may not be available the next time they come in. "In most rural areas, we are aware of when payday is, so we aggressively price these titles for peak turnover," Hill said. He also noted that he has been surprised at how well DVD is doing in rural areas as well. It's in these departments that the demand for DVD is greatest.

"Overall, we've had good success with it. Sales have been up since Christmas."