Video City Announces Plans For Aggressive DVD Rollout
Video City, Inc. (OTC BB: VDCT) has announced plans for an aggressive rollout of DVD products for sale and rental. In what is believed to be one of the largest DVD rollouts, Video City will offer chain-wide selections of 500-1,200 rental units in its stores by November 1999. The move is being made following explosive growth in DVD rental activity in Video City stores that have been offering DVD's on a test basis. ""As a result of this very successful test, we have decided to escalate our plans to expand DVD offerings in all 77 Video City stores,"" said Richard Gibson, Video City President and Chief Operating Officer. Video City conducted focus group studies with its DVD customers and found that DVD renters continue to rent VHS products as well as DVDs. Video City also found that DVD renters tend to come in the stores more frequently than VHS renters and are seven times more likely to rent a catalog title along with a new release, generating 50 percent more revenue per transaction than that of a typical VHS only customer. ""Our customers are telling us that they want DVD now and we are responding quickly to their needs,"" Gibson stated. Nearly four million DVD players have been sold in the United States and that number is expected to double by the end of 1999. Consumer electronic analysts expect the DVD penetration rate to rival that of VHS hardware in the next six years. Video City also recently unveiled its unique merchandising technique of displaying DVD at eye level, within the VHS new release display section. ""This places the DVD products in the most valuable real estate in our stores and exposes all of our customers to this exciting new format,"" Gibson said. ""Presenting DVD products alongside the traditional VHS new releases is consistent with the mainstream growth trends we are experiencing,"" said Ted Sarandos, Video City's Vice President of Product and Merchandising. About Video City Video City owns and operates 77 stores in 10 states. It has grown substantially from 18 stores in the past year and a half and is one of the nation's fastest-growing entertainment companies. When its pending merger with West Coast Entertainment is completed, the company will own 319 stores and have an additional 107 franchise outlets.