NewswireToday - /newswire/ -
London, United Kingdom, 2009/08/24 - Pricing is an increasing area of focus for Blu-ray and although a number of new BD releases are achieving healthy sales, catalogue titles continue to underperform. Futuresource has launched a Blu-ray price tracking service to track this marketplace.
In 2009, Blu-ray title prices have declined rapidly and the pricing gap is narrowing, according to Futuresource Consulting’s price tracking service. The service shows that in February the average Blu-ray price for new release movies in the UK was £27.29. By the beginning of August this had dropped to £16.74 – a sizeable decline of 40%.
Catalogue pricing has also fallen, but not by such a significant amount. From an average price of £16.87 in February, this dropped to £14.25 in August; representing a decline of 15%. When looking at the average catalogue price across the three largest etailers, (Amazon, Play and HMV), the price drop is far more significant, with the average catalogue price hitting £11.22.
Back in Q4 2008, both in the USA and the UK the premium for purchasing a new release title on Blu-ray compared to DVD was between 30% and 80%. However, for catalogue BD titles this premium was considerably higher, and in some instances was as much as 300%. Although it has never been disputed that consumers will pay more for Blu-ray, the premium in the market in 2008 was clearly not sustainable.
“Pricing is becoming an increasing area of focus for Blu-ray,” says Alison Casey, Head of Global Content at Futuresource Consulting. “Although a number of new BD releases are beginning to achieve healthy sales volumes, catalogue titles continue to disappoint. The retail price of Blu-ray titles, particularly when compared to DVD, is a key factor in holding back sales. Research shows that Blu-ray player owners are making a value judgement call when deciding whether or not to pay the Blu-ray premium; often continuing to buy some titles in standard definition.”
To help companies develop more robust pricing strategies for both DVD and Blu-ray, Futuresource has launched a weekly retail price tracking service. The service captures retail prices across all DVD and Blu-ray titles from 40 online retailers. The service is currently available in the UK but Futuresource is in the process of rolling it out to other international territories.
Retail prices for all SKUs of all titles are gathered from the Internet every Monday (release day) and are delivered to clients within 48 hours, or even less for key new releases. The pricing information is “matched” against a continuously updated database of all new title releases as soon as they are issued with a catalogue/bar code number thereby also enabling the collection of pre-release pricing.
One of the main keys to the success of this price tracking service is the powerful software in which the pricing data is delivered. Subscribers are able to track individual title prices week by week across all etailers, as well as looking at new release, catalogue, special edition and promotional pricing trends. The different price points offered by individual distributors can also be monitored and compared.
“We launched the service on Blu-ray first in response to overwhelming client demands for comprehensive and robust weekly price comparisons,” says Casey. “With so much pressure on the industry to establish Blu-ray in Europe, and at the same time maximise revenue opportunities, it is clear that success depends on how quickly people react to changes in competitive pricing.
“The DVD price tracking service is also generating significant interest,” says Casey, “with clients wanting to track unit sales performance against the selling price. For this we are able to provide them with all the tools to import their own sales data (or OCC data).
“The focus on Q4 this year is intense and many in the UK home video industry believe it will be the most challenging yet. In judging the success of this critical sales period, it will not be just about units shipped, it will also be about the price the consumer pays. As a result, the weekly tracking of DVD and Blu-ray prices is likely to become even more of a focus for the industry as we move into the run up to Christmas.”