Walmart Move Could Render DVD Sales DOA
The Wall Street Journal reports Walmart is cutting back DVD displays as part of its effort to appeal to "higher-end" (read: Target) shoppers.
This means no more display cases to pimp the latest releases. Reporter Nat Worden quotes a stock analyst who says this means DVD and Blu-ray are dead in Walmart's eyes:
"We think the new strategy implies Wal-Mart no longer sees DVDs and Blu-ray discs as traffic drivers," J.P. Morgan analyst Imran Khan said.
Phoenix movie blogger Colin Boyd hints the situation could be the tipping point that kills the movie industry's cash cow:
The studios count on Wal-Mart to move over 30% of all of their product, and in an down environment overall for home video sales and rentals, that's probably not good news for industry. However, it could be seen as another door opening for online retailers, like NetFlix and Amazon.
There's not a direct correlation there, but online could see a small spike from it. Will it impact sales in stores? Absolutely, although I don't know that we'll be able to say how much until the first quarter of next year, because DVD sales are always brisk around the holidays.
It definitely seems people haven't been agog at buying up DVDs anymore. How many DVDs do you buy in a year? In a decade?
Wal-Mart Scales Back DVD Displays [Wall Street Journal]
Walmart Eliminating In-Store DVD, Blu-ray Displays [Get the Big Picture]
(Photo: Clean Wal-Mart)
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Comments:
And yet, I still love having a look at the $10-and-under movies at Target... (And I saw a season of the Simpsons for $17.99 the other day! One of the good seasons!)
The last DVD I bought was so long ago I don't know what it was. I have Netflix mail delivery and Netflix streaming to my xbox. Why buy DVDs?
I can't remember the last time I bought a DVD. I love my Netflix. The idea of owning DVD's just doesn't interest me at all.
I guess as Wal Mart goes, so goes the nation!
RedBox + $5 Box at Wally World means I don't spend $15 for DBDs that I might watch once.
I might buy 2 new releases a year, otherwise, just watch from RedBox. With more RedBoxes showing up around town, I have less reason to buy DVD's or go into Blockbuster.
@apd09:
no one is going to pay that money they want for Blu-Ray discs
Your opinion, while interesting, is irrelevant in the face of facts:
BDA President, Andy Parsons...counts 10.7 million Blu-ray players sold in the United States by the end of 2008, about two and half years since they first became available. By comparison, three years after DVD was launched, there were 5.4 million DVD players in consumers homes.
Physical Media is barely still breathing. My mom is the only one I know who buys movies, and she gets them at used shops.
@apd09: Also, if you're paying $30 a movie, I'd like to introduce you to a website called Amazon.com. They have excellent customer service, sometimes ship you an absurdly large box with a small item inside, and offer quite nice prices on Blu-ray Discs.
[www.amazon.com]!386709011%2Cn%3A!387545011%2Cn%3A387547011%2Cp_n_binding_browse-bin%3A387547011&sort=price
that's weird, one of the reasons I go to target is their cheap movie selection. it's also the main reason I try not to go to target
Wow, I must be the only one that still cherishes my Blu Ray and DVD collection. 700 and counting! Just got back from Best Buy right now, as a matter of fact.
Also, Wal Mart has crazy deals on random Blu Rays sometimes. Picked up SUPERMAN: THE MOVIE and THE SILENCE OF THE LAMBS for $10 a piece.
@Traveshamockery: Weren't DVD prices rather insane when they first came out? I want to say about as high if not higher than Blu-ray, but I couldn't find anything to back that up.
The $5 DVD rack is the only reason I ever go to Walmart. I guess I can save myself some money, gas and time now.
See you in Hell, Walmart!
@Traveshamockery: That figure is including Playstation 3s, which account for 3/4 of Blu-Ray players.
If I could have played DVDs on my Super Nintendo (the fact that I couldn't, interestingly enough, led to the creation of the Playstation by Sony) the sales figures would have been different.
When is everyone going to realize that the marketing model of factory-produced digital media (CDs and DVDs in printed boxes on the shelf) has gone the way of the dinosaurs!
There is no reason for having any stock at all (or not very much)!
I should be able to walk up to any retailers' counter (Wal-Mart, Target, even Tower Records), tell them what I want, and have them download and burn the data and print the inserts while I wait (not very long, please).
It isn't rocket science.
@Traveshamockery: Nicely pruned quote there - you leave out the part where over half of those sales are PS3s, and the fact that his 5.4 million DVD Players doesn't count PS2 sales, as the PS2 wasn't available until slightly more than 3 years after DVD's came out. If you go out to 4 years, and count PS2 sales, you'll find that the PS2 alone sold nearly 8 million dvd players in it's first year on the market. Doesn't make Blu-ray seem so widely adopted, to me.
@Moonshadow101: "The downside to being better than everyone else is that people tend to assume you're pretentious."
Walmart should stick to what works- selling cheap shit to welfare recipients.
@Etoiles: I'm the same way...I always stop by the cheap DVD areas and have a look. I normally don't buy movies when they first come out...because it's still the same movie 6 months later when it's discounted.
About a year ago, Target had the first 12 seasons of the Simpsons for $15 each, and we snagged the first 10 that we'd been wanting for a while. It actually came out to about the same that we would have paid on Amazon.
@Traveshamockery: i'm in the same situation with apd09. i have a bluray player and only a handful of movies. i wont pay unless they go on sale for around $15, and even then i research the movies on avsforum to make sure the transfer is good quality.
apd09 was speaking of blu-ray disks, not players. yes i see the relation, but my first blu-ray player purchase was mostly for upscaling dvds. there was a huge market for that a little while back, and there probably still is.
I must be the weird one who owns almost no DVD movies except for the first few seasons of Family Guy. I never saw the point to buying movies I am going to watch once, then probably not watch for a very long time. (I get Netflix rentals in and out of my mailbox almost every day though).
I try to avoid WalMart at all costs but recently went there to pick up a prescription for someone else. I picked up some classics for the kids...the original Parent Trap, original Charlottes Web and the Apple Dumpling Gang. I haven't bought a DVD for myself in 3 years.
@mbz32190:
I see it as a collection, though. Not just "I want to watch this movie right now, so I'll rent it as opposed to buying it."
Why do people collect anything, then?
@Traveshamockery:
And then there was this quote from this article in the LA Times today:
"But as DVD sales have collapsed by as much as 25% at some studios,...."
[www.latimes.com]
I don't think I have purchased a DVD since I joined the netflix cult last September.
@flyingember: Walmart keeps its cheap movies in these huge unsorted bins. You can sometimes find a bargain in them, but usually it's not worth the effort. If they want people to buy DVD's then they need to have the bargain DVD's prominently displayed like they do in Target.
Some stores have already implemented the clear-aisles look - in electronics, the aisle features are just incorporated into regular shelving. Instead of a $5 DVD bin, it's an organized display of $5 movies, the same way the regular DVDs are displayed and the same way $5 movies are displayed at Target.
As long as new-release DVDs keep selling, they'll keep having huge quantities of them - you'll probably just see them on an endcap instead of on a huge cardboard display.
[This could just be a transition thing, but stores I've seen with clear aisles still had the new-release displays by the store's entrance.]
@Traveshamockery: Except that is not a valid stat because Blu-ray players also play DVDs. DVD players didn't play VHS tapes so if people needed a new player to replace a broken machine, they would buy another VHS.
Also, I would expect that Blu-ray figure to include Playstation 3 sales, which are not necessarily going to be put into service playing DVD's.
I have Netflix, but I still buy Blu Rays and Dvds; though I'll usually watch them from Netflix first. I like the prices at Wal Mart, but let's face it, the selection of DVDs and Blu Rays stinks. It's a store that caters to the masses and it's only going to carry the most popular films and budget titles.
@mbz32190: Most of my collection is kids' movies that my kids enjoyed watching over and over, but they seem to be moving past that phase.
@flidget: The store near me seems to be implementing the clear-aisle look as I stopped in to buy some cheap clothes (yeah, shoot me for buying clothes at walmart) and their plus size section now has a total of 4 racks of really ugly stuff.
I used to be able to buy inexpensive jeans and t-shirts for everyday wear, but not anymore. I could, however, drive a car between the clothing racks since they're spaced so far apart now.
But they still have a couple big bulk bins of $5 and $7 DVDs in the main aisles.
Only on a rare occasion do I buy DVDs or Blu-Rays at Walmart. We stick mostly with Amazon as they are almost always less expensive.
One of my local Wal-Marts has already done this. Removed the island racks of DVDs and instead organized the DVD racks by price in the aisle. There's still $5 DVDs, but they aren't in that huge wire bin in the middle of the main aisle.
@apd09: OK, I'll say it: I buy Blu-Ray movies. I don't pay full price for anything (Amazon is great!), but I do buy them. Why not? I may pay a few bucks more, but I do see a difference between a lot of DVDs and Blu-Rays-- especially with newer films.
I still don't buy into the idea that we should all give up media for downloads. Streaming, maybe, but I'm not going to give up discs until either compression gets better or bandwidth gets wide enough.
But I sure as heck don't get them at Wal*Mart...
@mrgenius: I would never go to Wal*Mart if not for the fact that the local Target doesn't sell the automotive stuff Wal*Mart does.
And before I get told to go to an automotive shop, I work late, and often the only place open by the time I get off the train is Wal*Mart or Target. Necessity is as necessity does.
@Etoiles:
Every season of the Simpsons is a good season! :) And I think I saw that back in the spring and grabbed it and hid it for Christmas...if only I can remember where I put it now...
@MattAlbie: No no, I'm here as well, and I enjoy my collection. I only buy a few at most each month, so it's not a terribly expensive habit for me.
Personally, I have Netflix and we got a PS3 for BOTH the gaming capacity AND the fact it plays Blu-ray. My thing has always been if I know I'm going to watch a movie more then twice I'm going to buy it. I think this move has more to do with people not spending their "disposable" income on movies to purchase and just dealing with renting them from places like Netflix until they can afford to buy again.
DBDs...how my 5yo says DVDs, lol! And yes, we own many DBDs because when you watch them over and over and over and over and over and over and over and over and over and over and over and over and....like the Thomas the Tank Engine that is going on as I speak...$9.99 for one time is a small price to pay.
Doesn't anyone here buy children's or exercise dvds? There's a lot more out there than just movies. We have many dvds but few are adult movies - children can watch the same thing day after day (even movies like Star Wars and The Simpsons), and exercise/yoga dvds are worth it to own because you do them over and over.
Wal-Mart is right in that it should scale back its cheapo DVD bins. It's tacky, it's crappy, and who the heck wants to dig through a massive bin of DVDs? Target displays their DVDs in neat rows, whether they're $5 or $20. And they have them up front too, again, in neat rows. Wal-Mart's flaw was in dumping them into big bins to begin with, and thinking that people have the patience to go through them to get one good gem (which usually does not exist in the bin - it's like getting a cereal box that's missing a toy).
@UCLAri: To each his/her own. I am not judging anyone who chooses to shop there or anywhere else for that matter. I just don't like being around people wearing confederate flags or shirts that say "I HATE QUEERS". Which are still not as bad as the Tweety-Bird shirts paired with teal stretch pants.
I still buy DVDs, but not nearly as often as I used to. A lot of movies that I might have bought once upon a time I now merely rent through Netflix. Actually, a lot of movies I might have seen in the theater once upon a time I now merely rent through Netflix once they come out on DVD. Be afraid, Hollywood -- be very afraid.
That's too bad really, and to be truthful, I got my last DVD purchases at Wal-Mart at a good price.
I managed to pick up Transformers G1: Season 2, Part one for 20 bucks. I also managed to pick up the first and second Death Note movie there for 13 bucks a piece, which kind of irked me since I paid 25 bucks for 'L Change the WorLd' alone hehe.
You mean someone is finally realizing that 30+ dollars for a Blu-Ray disk is ridiculous and they are not selling enough to warrant such a high profile position anymore?
Maybe they will actually start to lower the price on them and people will start buying, but until then no one is going to pay that money they want for Blu-Ray discs. I have a player and have 5 movies and refuse to buy more until the price drops.