Q4 sales expectations tempered
Retailers say holiday shopping has yet to begin
By Ned Randolph -- Video Business, 11/16/2007
NOV. 16 | Halfway through the fourth quarter, some studios and retailers seem to be tempering expectations for DVD sales despite a lineup of 16 titles that made more than $100 million at the box office, including four that made more than $300 million.
Shrek the Third is estimated to have sold 1.5 million to 2 million units so far.
Walt Disney Studios Home Entertainment’s Ratatouille reached No. 1 on VB’s Top DVD Sellers chart in its debut week, ended Nov. 11, with retailers including Virgin Megastores, Newbury Comics and Video Buyers Group reporting healthy sales for the tale of a rat inspired to become a chef. It was the bestseller for the week at Blockbuster and Amazon.com, among other retailers.
“Ratatouille is performing exactly as we had expected,” a studio spokesman said.
DreamWorks Animation and Paramount Home Entertainment’s Shrek the Third and Warner Home Video’s Ocean’s Thirteen hit shelves Nov. 13 and similarly started off with good, but not extraordinary sales, according to retailers, who said consumers do not seem to have started holiday shopping in earnest. A rival studio source said Shrek the Third appeared to be performing on par with Spider-Man 3 in its first day in stores, which would put Shrek at about 1.5 million to 2 million units sold.
“Ratatouille is doing very well. Shrek 3 and Ocean’s Thirteen are off to a respectable, though not earth-shattering start,” said Chris Anstey, Virgin Megastores senior category manager.
“I think this is something to do with sequel-itis,” said one studio source, adding that it’s too early to gauge Shrek the Third’s performance, until holiday shopping revs into gear.
“It’s hard to tell around this time when it’s right before the fourth quarter really kicks in. You never know what people are holding out for,” said Ian Leshin, DVD buyer at Newbury Comics.
Both Shrek the Third and Ocean’s Thirteen bowed with large and varied marketing campaigns.
In an account-specific promotion, Warner is offering a free download of Ocean’s Thirteen from Movielink, when the DVD is purchased at Target.
Shrek’s second sequel was backed by TV spots declaring it the country’s “No. 1 DVD” as well as commercials from Toshiba and DreamWorks promoting HD DVD and the movie together. Blockbuster also is running a large in-store campaign and “Ogre the Top” sweepstakes tied to the movie through Jan. 14.
Many insiders are warning the Christmas shopping season is still too far away to gauge how a title will hold up through the fourth quarter.
“I’m excited about the fourth quarter,” said Mark Higgins, Trans World Entertainment VP of DVD, videogames and consumer electronics merchandising. “There were 17 releases that did over $100 million a piece. We’re launching a new format, and I’m excited to see some hardware pricing below $100 to drive the HD category. I think it will be a great holiday selling season in terms of product.”
“I think box-office results are better, which to me will indicate that we’re going to have a stronger selling season,” he said. “I think that’s going to drive more people to a high-definition format. It’s still in its infancy, obviously, but December and January should yield very good results for that category, and we really look forward to it taking off in early 2008.”
