NARM: Spread out release dates
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Retailers call for studios to consider January, February for big CD, DVD titles
By Susanne Ault -- Video Business, 5/10/2007
MAY 10 | Music retailers have a new refrain that they want suppliers of both DVDs and music CDs to hear. It goes something like: spread your biggest new releases throughout the year if you want to improve sales.
Suppliers of blue chip CDs and DVDs annually jockey for shelf space during the fourth quarter, each year’s heftiest shopping season. But this generally results in certain albums and DVD titles being unnecessarily crowded out, according to the National Assn. of Recording Merchandisers.
During his keynote speech at the group’s annual convention, NARM president Jim Donio recently stressed the volume of CD sales lost to fourth-quarter clutter. He told VB after the conference that the issue of overcrowding affects DVD as well.
“We will always have key releases in the holiday season; there is no way around it,” said Donio. “We are suggesting that a portion of these releases might make more sense coming in January or February. The summer might be a second holiday season, with kids out of school and people on vacation.”
Ramped-up downloading is softening CD sales. But Donio believes bad timing is further eroding the category. Average sales for a fourth-quarter release have fallen by 35% over the past three years, even though high-profile releases congregate then.
Virgin Megastores senior product manager Chris Anstey agrees that summer is an opportunity for DVD growth.
“The summer months do tend to get very lean,” he said. “With more blockbuster movies being released in the spring, August could really stand to be a prime new month, not to mention that there would be less competition with other big releases in the busier September/October period.”
Hastings Entertainment CEO John Marmaduke began complaining of record labels’ “seasonal suicide” approach to CDs at last year’s NARM convention. Although he applauds recent studio efforts to shift certain A-list DVD titles from a fourth-quarter to first-quarter launch—New Line Home Entertainment regularly stakes out the first part of January for its largest hits, such as The Wedding Crashers in 2006, for instance—Marmaduke thinks studios could do even better.
“Studios have had fantastic success in January, yet releases fall there almost by accident,” Marmaduke said. “There is limited shelf and customer attention in December but a clean slate for both retailer and customer in January.”
The NPD Group calculates that between 2004 and 2006, the percentage of each year’s overall DVD sales have grown in the first quarter from 22.8% to 26.3%. During that same frame, fourth-quarter sales share have dropped from 32.9% to 31.5%.
Rising use of gift cards in January is likely propelling some of this shift, along with additional titles available in the first part of the year. However, consumers are getting stretched with more and more options during the holidays, according to Russ Crupnick, NPD VP and senior industry analyst.
“The amount of money that people say they will spend on the holidays is not increasing as much as the number of choices,” said Crupnick. “Something has to give at some point.”
NARM’s Donio is upbeat over evidence that certain top-notch CDs will street outside of the 2007 fourth quarter, including May releases of new efforts by Maroon 5 and LinkinPark.
Anstey is likewise hopeful that additional studios will come around to embrace other parts of the year for DVD releases.
“The old mentality that titles will only perform well if released during busier times of the year doesn’t hold as much weight anymore,” Anstey said. “If a movie has appeal, it will have big sales regardless of the season. Certain distributors have yet to totally embrace this concept.”
