Blu-ray consumers buying more from Amazon, Wal-Mart

Best Buy still most preferred for format purchases

By Susanne Ault -- Video Business, 7/8/2008

JULY 8 | Amazon.com and Wal-Mart are increasingly winning over Blu-ray Disc customers, according to recent NPD Group surveying.

NPD surveys done last fall and in March both show Best Buy as the preferred Blu-ray shopping destination, followed by Amazon and Wal-Mart.

But NPD senior industry analyst Russ Crupnick says the latest survey reports that current respondents are showing growing affinity to Amazon and Wal-Mart, which coincides with strengthened merchandising at the retailers.

“While Best Buy is still the leader, the percent of people who are saying that Amazon.com and Wal-Mart [is their favorite Blu-ray retailer] is growing at a much faster pace than average,” said Crupnick.

Blockbuster was elevated to No. 5 in the ranking in NPD's latest survey, following Target at No. 4. Financially struggling Circuit City placed No. 4 in NPD's fall report, with Target at No. 5.

NPD did not provide specific percentage responses from survey participants.

Explaining the rise in popularity by the No. 2 retailer, Crupnick especially took note of Amazon’s aggressive marketing of Blu-ray, because the site consistently trails mass merchants in standard-definition DVD business.

“All the efforts that Amazon.com has put into the category are paying off. They are always running a lot of specials,” said Crupnick of the site’s frequent exclusive offers. “Also, their customer profile is just dead-on for Blu-ray. It has an early adopter demographic, higher income and educational level.”

NPD’s latest study matches Amazon’s own findings about its Blu-ray performance. The site commands a Blu-ray retail share that is 3.5 times that of its standard DVD share, according to Peter Faricy, VP of movies and music at Amazon.

Faricy declined to provide exact DVD and Blu-ray share information.

Current Amazon Blu-ray promotions include at least 30% discounts on all Blu-ray titles. Customers can shave 65% off an eight-title Blu-ray bundle when they buy either a PlayStation 3 or Sony Blu-ray set-top.

Also, through Amazon’s ‘1st to Know’ notification service, site shoppers can sign up to receive e-mails when desired titles are formally slated for Blu-ray release.

As the dominant DVD retailer for some time, it’s little surprise that Wal-Mart is nurturing a Blu-ray customer base. Since Wal-Mart announced in February it was siding with Blu-ray, effectively ending the format war, the chain has gradually been building dedicated Blu-ray sections. Recently, Wal-Mart rolled out a Father’s Day promotion with which customers received a free $100 chain gift card with any purchase of a Blu-ray set-top or PlayStation 3.