‘Super Saturday’ (Dec. 21) Sales Topped Black Friday

With the winter retail holidays a week shorter than last year, merchants have pulled out the stops attempting to get consumers into stores and online before Christmas.

New data from retail research firm Customer Growth Partners suggests marketing efforts coupled with last-minute shopping holiday shopping is paying off.

Consumers spent a record $34.4 billion, the biggest single day in U.S. retail history — topping perennial Black Friday retail juggernaut by 10% ($31.2 billion).

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Walmart, Costco and Target paced big box stores — while e-commerce (Amazon) has driven 58% of sales growth from the same day a year ago. Other big retail days this winter holiday season have been Dec. 14, with $28.1 billion, and Cyber Monday, with $19.1 billion.

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All four retailers account for a vast majority of packaged-media retail.

“Super Saturday was boosted by the best traffic our team has seen in years,” Craig Johnson, president Customer Growth Partners, said in a statement. “The question now is whether [the] momentum leads to sustained economic growth into 2020 and beyond.”

 

Costco Considered Free SVOD Service for Executive Members

Taking a page out of the Amazon Prime Video playbook, Costco Wholesale has reportedly considered launching an over-the-top video service for its premiere membership customers.

The service, which would have partnered with an existing OTT video platform to reduce costs, aimed to mirror Prime Video offering Prime members free access to myriad catalog TV shows and movies, in addition to original content.

Costco is the country’s fourth largest retailer and remains a significant seller of Hollywood DVDs and Blu-ray Disc titles. It sought to include the streaming service with its executive $120 annual membership, which includes 2% back on purchases. Costco also offers a $60 “gold star” membership.

Negotiations reportedly broke down with a potential OTT video partner over financial terms, according to The-Information.com, which cited sources familiar with the situation.

“We currently have no intention of offering a streaming service to members,” Paul Latham, SVP, membership marketing services at Costco, told the website.

The retailer earlier this year aligned with MoviePass selling the theatrical ticket subscription service at a discounted $89.99 annual price. The purchase included membership to Fandor.com, which streams indie and catalog movies.

 

 

 

 

Summit Explores OTT’s Promise and Pitfalls

The opportunities and pitfalls of the over-the-top market were the leading subjects of the OTT & Video Distribution Summit taking place Aug. 2 in Marina del Rey, Calif.

Consumers are cutting the cord with their cable companies and moving to OTT because of its superior value, including better choice and lower cost.

“Consumers have basically said, ‘We’re paying too much. I don’t want to watch all those channels,’” said panelist Mickey Alpert, president and CEO, Merisco Solutions, and former EVP at Cablevision.

“Cable companies are literally the most hated companies in America,” said keynote speaker Jeff Binder, EVP, home and entertainment, T-Mobile U.S., because they are regional monopolies and don’t have to cater to customers.

In addition to OTT services peeling away video subscribers, another threat to cable is the coming 5G technology, which will be a “game-changing technology,” he said. Cable companies that have been able to lean on broadband fees, even as cord cutters have eschewed buying a video subscription, may find customers can get rid of broadband with 5G.

“There are changes around connectivity that are coming that are probably a bigger story in some ways I think than the story about how the content industry is changing,” Binder said.

“4G changed the way all of you use your phone; 5G is going to change the way all of us use our home as well as our phone,” he said.

For now, though, it’s the chance to get the content they want at a lower price that is drawing consumers to OTT services.

“Customers value choice and flexibility,” said panelist Kathy Payne, head of content acquisition management, Amazon Channels. “At Amazon, we’ve decided we’d like to offer channels a la carte.”

Amazon Channels aggregates such OTT subscription services as HBO, Showtime and Starz. There are more than 150 channels offered in the United States, Payne said, not to mention the hundreds available internationally.

“We’ve heard from customers loud and clear that they like the option to just buy channels a la carte,” she said. “It’s really easy to come in and pick what they want.”

In addition to a la carte there are bundled OTT services that are making a go of it, such as Philo, which started in colleges. “It’s a TV package that hasn’t really been available before. [It’s a service] without paying this huge amount for sports,” noted keynoter Andrew McCollum, Philo CEO.

There are also ad-supported services that offer programming to consumers for free. Roku Channel has aggregated some of those. Roku’s Seth Walters, VP, demand partnerships, called it “our sandbox for creating our most premium ad-supported service on Roku.”

Making a go of it as a new OTT service is a challenge. The number of domestic OTT services has reached more than 200, with the three top players dominating, noted Brett Sappington, senior director of research, Parks Associates.

“It’s Netflix, Amazon, Hulu and everybody else,” he said, adding there is a second tier of services, such as HBO, Showtime, Starz and CBS, that range from 1 million to 5 million subscribers.

A smaller service must differentiate itself and appeal to a niche, rather than try to compete with the big pocketed broad services offered by Netflix and others, he said.

“If you cannot specifically identify who your customers are then you’re probably not going to be successful,” he said.

Offering exclusive or new content helps, as consumers rank new release or original content as most important, according to Parks research.

Many OTT services overlook marketing, and that’s a mistake, Sappington said. Startups “don’t realize the marketing costs involved,” he said.

He praised the marketing efforts of independent film streaming service Fandor, mentioned in a panel at the summit. Panelist Felice Oper, COO of Fandor, said they had sold 290,000 subscriptions through a Costco bundle with subscription theater ticket service MoviePass in just two and a half months.

“It was a very successful transaction,” Oper said. “We’re still working with Costco.”

Keynoter Darcy Antonellis, of Amdocs-owned Vubiquity, talked about the international reach of the OTT business and the services her company supplies it, noting her team is often on a plane.

“We all have to be thinking global,” she said.

“It’s all about understanding where the audiences are,” she added. “It’s an on-demand world, but it has to be in a form and a language for a particular culture.”

She offered an anecdote about a viewing spike at 3 p.m. that they found involved parents waiting for their kids to get out of school. She said the industry must start to understand how to service consumers when and where they need entertainment.

A prominent woman in the industry, she also addressed the dearth of women in the entertainment and technology business. Having mentored girls 8-13, she noticed, “You could almost set your watch, because of peer pressure, when they were gonna shut off STEM [science, technology, engineering and math].”

“It’s a real challenge for our country,” she said. “You don’t want any room as smart as one brain, and you don’t want any room as smart as a collection of similar brains.”

Amazon on Top in Harris Reputation Poll

Amazon took the top spot in the 2018 Harris Poll Reputation Quotient Rankings.

Disney ranked high at No. 5, and Netflix, at No. 21, beat out fellow tech giants Google and Apple, ranked Nos. 28 and 29, respectively.

Among mass merchant/consumer electronics retailers, Costco (No. 17) topped Best Buy (No. 46), Target (No. 49) and Walmart (No. 69).

According to Harris, the Reputation Quotient is “technically designed to understand how a company is perceived in modern culture.” The measure takes the top most visible companies (for good or bad reasons) and evaluates them across six dimensions of corporate reputation attributes to arrive at a corporate reputation ranking. If a company is not on the list, it does not necessarily suggest that they have either good or bad reputation, but rather they didn’t reach a critical level of visibility to be measured.

The Weinstein Co., which has been embroiled in executive Harvey Weinstein’s alleged sexual assault scandal, and Takata, with its infamously defective airbags, came in last on the list at Nos. 99 and 100, respectively.

Fandor Movie Streaming Service Names New Executive Positions

Movie subscription streaming service Fandor has upped Felice Oper to the chief operating officer position. Oper, who previously served as general counsel and chief distribution officer, will continue as general counsel.

As COO, Oper assumes oversight of the programming and marketing groups, as well as the product and engineering teams.

Separately, Fandor named TS Ramakrishnan to the chief product engineering officer position. He previously headed engineering for Yahoo! Messenger and mobile, and was VP of product engineering at Facebook.

Under Oper’s leadership, Fandor’s subscription base has grown more than 10 times, underscored by OTT partnerships with Amazon Channels, Sling TV, CenturyLink Stream and YouTube Red.

She engineered alliances with MoviePass and Costco, launching the sale of the “Movie Lover’s Package” both on Costco.com and MoviePass.com. Fandor launches on Vizio TVs this spring.

“Felice has proven she is committed to helping Fandor reach new heights in the OTT space,” CEO Larry Aidem said in a statement. “Her exemplary knowledge and dedication … continue to support the growth and development of partnerships that makes movie selections more accessible to our customers.”

Aidem said Ramakrishna would help expand movie and editorial content to subs, which in turn affords Fandor the opportunity to grow the brand.

“[TS’] breadth of experience in Silicon Valley and the digital space will enable Fandor to further develop the company’s user experience, enabling us to further grow the Fandor community,” added Oper.

 

MoviePass, Fandor Extend Costco Joint-Sub Deal

Movie-theater subscription service MoviePass and indie-film streaming service Fandor have extended their Movie Lovers Package offer at Costco post holidays.

The package deal for both services is available to Costco members for a flat fee of $89.99 and non-Costco members for $89.99 plus a 5% surcharge, and covers a year of membership for both MoviePass and Fandor.

The offer will only be available online at Costco.com until Jan. 10, 2018.

Subscribers who sign up for the one-year subscriptions will receive digital codes providing instant access to Fandor’s library of more than 5,000 films, as well as a year’s worth of in-theater experiences through MoviePass. New members will need to enter each code on the respective MoviePass and Fandor websites in order to complete the sign-up process.

MoviePass introduced its $9.95 per month subscription plan in August 2017, as part of a majority acquisition of MoviePass by Helios and Matheson Analytics Inc. Since the rollout of the $9.95-per-month plan, the MoviePass subscriber base has grown to more than 1 million subscribers in just 4 months, according to the company.

Fandor streams a library of more than 5,000 handpicked, award-winning movies from around the world, according to the company. With more than 500 genres that include Hollywood classics, undiscovered gems, and the latest festival favorites, Fandor provides curated entertainment and original editorial content on desktop, iOS, Android, Roku, Apple TV, Chromecast, Amazon Prime, Sling TV, CenturyLink Stream, and throughout social media.