Bookstores Split on Disc - HMM Article - High-Def Digest Forums
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Old 06-13-2009, 07:18 AM
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Default Bookstores Split on Disc - HMM Article

http://www.homemediamagazine.com/ret...lit-disc-16080

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Bookstores Split on Disc


By Billy Gil | Posted: 12 Jun 2009
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Two major bookstore chains are employing diverging strategies in the movie disc business.

While Borders recently announced it would cut shelf space for DVD, a Barnes & Noble spokesperson said the No. 1 bookseller will continue its expansion of DVD and Blu-ray Disc.

Borders, in its most recent financial call on for the first quarter (ended May 2), said same-store DVD sales fell 22% compared to the same period a year ago, and the company would therefore reduce media floor space devoted to CD, DVD and Blu-ray Disc. Borders Group CEO Ron Marshall said “digital options have overtaken physical CD and movie sales,” and the company would therefore replace that product in stores with better-selling cooking, children’s product and bargain books.

In general Borders now says it will expand its Blu-ray Disc offerings because it is a growing category, while reducing DVD stock.

“Blu-ray has been growing faster than DVD, but it seems to be the consensus opinion that Blu-ray Disc won’t make up for the decrease in DVD,
” said Edward Woo, analyst with Wedbush Morgan Securities in Los Angeles.

Borders also said it would deploy more DVD product to the stores in which it is selling more DVDs. A Borders spokesperson said the No. 2 bookseller also would be addressing the assorted mix of products to reflect regional taste and interests.

“Obviously, it’s not good for anyone who produces the content and distributes it,” Woo said. “We’ve seen the overall weakness in spending, particularly in DVD, in part due to economy and various other reasons.”

But things are different at Barnes & Noble. The company posted a $2.7 million loss for the quarter ended May 2, compared to a loss of $2.2 million a year ago, but the New York-based retailer reported results bested projections.

A company spokesperson said Barnes & Noble has been expanding its selection of DVD for years and will continue carrying a full line of Blu-ray Discs.

Although Barnes & Noble does not break out specific sales with regard to CD, DVD and Blu-ray Disc, in its financial call, CFO Joseph Lombardi said a drop in the category was mostly attributed to CD, and a company spokesperson said that sales of DVD and Blu-ray are up slightly this year.

The differing attitudes toward movie discs at the two top book chains may be more about their overall competitive standing, rather than any sea change in retailer attitudes toward movie discs, Woo said.

“Barnes & Noble has been outperforming Borders overall,” Woo said. “Barnes & Noble is doing a much better job than everyone else.”

The chain continues to aggressively market movie discs. Barnes & Noble is offering a month-long buy-two-get-one-free promotion online and in-store for all DVD and Blu-ray titles, ending July 7.

Although bookstores fall into a “specialty” category that has typically represented less than 20% of total packaged-media sales, and music and DVD only account for about 8% of Barnes & Noble’s total sales, such moves from the two biggest booksellers can mean a lot to independent content suppliers, as well as suppliers of specialty product.

“For us it is a very relevant issue because as a specialty distributor focusing on a limited market, retailers like Borders and Barnes & Noble are essential for customers who prefer to shop in a physical environment rather than online,” said Laure Parsons, director of home media sales and marketing for Zeitgeist Films. “We rarely place titles in box retail, so bookstores and independents are more important, and our audience tends to be a little older, so those customers may be more comfortable with a bookstore than the Internet.

“It’s hard to say just what the impact [of Borders’ move] will be, since we have definitely been moving more toward e-tail and other sources of income besides physical retail, but those stores have a great impact to build title awareness for our films.”

Borders’ new strategy of shifting to the high-definition format also could spell trouble for smaller content suppliers because they tend to release fewer Blu-ray Discs. Major studios are responsible for more of the Blu-ray release slate.

Also, Borders could shift focus to more book tie-ins with hit theatrical product — again hurting smaller suppliers. The Borders spokesperson confirmed the company has had tremendous success with Twilight, on DVD and Blu-ray Disc from Summit Home Entertainment, the top-selling title of the year thus far. Borders participated in the midnight sales of Twilight, which took place around the country at various retailers March 20, and had an exclusive limited-edition two-disc set of the film, plus an exclusive 18-month calendar of the film.

Borders also hit a home run with “True Blood,” the first season of which is available from HBO Home Entertainment. “True Blood” is based on the Sookie Stackhouse novels by Charlaine Harris, and Twilight is based on the bestseller by Stephenie Meyer.

“I think major new releases, especially book-based properties like Twilight, will remain an important focus for retailers like Borders and Barnes & Noble,” commented T.J. Moffett, SVP of home entertainment marketing for Summit Home Entertainment. “As a result, these films should continue to perform well on DVD and Blu-ray.”

The Borders spokesperson said both titles indexed at a higher market share than normal DVD rates.
May force some smaller content providers to offer Blu-ray versions.
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Old 06-13-2009, 03:14 PM
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“Blu-ray has been growing faster than DVD,
WTF?? I thought DVD has been in decline for 3 years now? How could Blu-ray NOT be growing faster?
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Old 06-13-2009, 04:28 PM
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Originally Posted by Favelle View Post
WTF?? I thought DVD has been in decline for 3 years now? How could Blu-ray NOT be growing faster?
The statement is accurate obviously just unnecessary. 100% growth is greater than negative growth (decline).

Chris
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Old 06-14-2009, 01:32 AM
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so - you'll all be rushing off to Borders to purchase your Recommened Retail Prices ?? Or try to grab the attention of a staff member to let you have a look inside the glassed cases ?

Here - have a quick POLL on how many forum members buy their titles from Borders.
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Old 06-14-2009, 01:42 AM
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I agree with the above. Borders charges on average $34.99 for their BD titles. Even if you go in there with a 20% off coupon Amazon is still cheaper most of the time.
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Old 06-14-2009, 01:55 AM
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Originally Posted by tonyjg View Post
Here - have a quick POLL on how many forum members buy their titles from Borders.
recently picked up body of lies for $15

but that became a chore as they couldnt find the disc for a few minutes

but other times, nah don't fancy being treated like a thief and paying full rrp...
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