Retailers pin Q3 hopes on Blades of Glory
By Ned Randolph -- Video Business, 8/31/2007
AUG. 31 | Humping along through 2007, retailers are looking for strong returns from last week’s release of Blades of Glory, the latest Will Ferrell comedy, to lift the third quarter.
Blades of Glory is one of the few big-box-office titles being released in the third quarter.
Blades, which pulled in $114 million at theaters, joins 300, which was released earlier this month, and the first season of NBC’s Heroes, which also debuted last week, as the three of the biggest titles in the period.
Blades “is a good title. It should do well,” said Ted Engen, president of Video Buyers Group, which represents about 1,600 independent stores.
Blockbuster spokesman Randy Hargrove agrees, considering the movie’s success at the box office.
“It was one of the largest releases,” he said.
Engen said business has been slow this summer, and “the biggest problem is the lack of titles.”
While Hollywood has grossed a record-setting $4 billion in the U.S. and Canada and should hit $4.15 billion, according to Media by Numbers, the DVD business has seen a drought of movie hits over the summer, with studios instead saving them for release during the big holiday shopping season.
“The year has been challenging for retailers. That’s no secret,” said Mark Higgins, Trans World Entertainment VP of DVD, videogames and consumer electronics merchandising.
“In May and June, we had some titles that didn’t perform as well as I expected, like Dreamgirls and Night at the Museum,” he said. “It’s a tough time of year. Spring and summer are always tough months. If it’s warm out, people are not watching movies, at least not at home.”
Michael Pachter, an analyst with Wedbush Morgan Securities who follows Blockbuster, estimates the third quarter will remain flat for retailers, if not fall off—even with the release of Blades of Glory and 300.
Pachter said it would be ideal if studios released two hit movies a month to retailers, but he said they are looking at overall returns and timing their windows to maximize them.
“Studios release movies when they think the time is right to maximize profits,” he said. “Christmas is their only artificial constraint.”
Shrek and Ratatouille, for instance, make great presents for kids, he said.
“And you know your mom wants to see Spider-Man. You can’t say that about Blades of Glory,” Pachter said.
But Engen would like to see titles' street dates more spread out.
“In the last three years, we’ve been moving more and more into becoming a fourth-quarter business. They dump so much product in the fourth quarter, studios end up cannibalizing their own sales,” Engen said. “Look at the titles that hit [theaters] in the spring. They could have put them out [on DVD] this summer, but they wait until the fourth quarter.”
