DALLAS -- Store-specific category management is on the horizon for supermarket video rental departments. SuperComm, the Disney-owned shared-revenue, pay-per-rental company here, is set to launch its SuperLink program, which has boosted profits 10% to 20% in preliminary tests, said Des Walsh, SuperComm's vice president and general manager. The program was demonstrated at the Video Software Dealers Association convention here May 21 to 24.
The first retailers will start using the program in June, he said. Walsh would not identify these retailers, but said, "in each case, they will be retailers who are the leaders in their markets, with a sufficiently high rental volume to adequately test the effectiveness of the system." The system differs from existing programs because it provides purchasing recommendations based on the past performance of comparable rental titles in individual stores in an "actionable" form, said Walsh. It also gives headquarters-level executives information on new releases, including cover art, gross profit and revenue analysis reports, handles end-of-term processing electronically, and allows for on-line queries into current data from the stores. "What we are providing is similar to what most buyers in other categories accept as standard, but up to now the information systems resources haven't been available to supermarket video buyers to give them the information they need in a usable form," said Walsh. Some video buyers can now get this type of information, but it is likely to be buried in 300-page printed reports, he said. According to the early tests, retailers may not have to order additional tapes to realize significant profit increases, he said. The program will encompass all video rental titles, not just those on the SuperComm shared-revenue program, said Walsh. While there will be no charge to SuperComm customers about information on SuperComm titles, the rest of the cost structure is yet to be determined, he said. One big player has already signed up for SuperComm because of the SuperLink program, he said. "Since the unveiling of SuperLink, one major supermarket retailer representing over 50 rental locations has committed to rolling out the SuperComm program in its stores," said Walsh. The SuperLink program will be rolled out in three phases, he said.
In the third quarter of this year, functions such as gross profit and revenue reports, and E-mail, will be made available, and the rental histories needed for comparable title analysis will start to be accumulated.
In the fourth quarter, the comparable title analysis and purchasing recommendations will be launched, along with new release title information and the electronic processing of orders and returns.
In the first quarter of next year, the company will provide on-line access to the data base and on-line comparable title analysis. More specific information and customized reports also will be available at that time.