MARKETING MATERIALS

KEEP YOUR EYES ON VBG’S EXCLUSIVE CONSUMER MAGAZINES!

Now Premiering and Vid Bits Gazette magazines are published exclusively for Video Buyers Group. Both are very important and powerful marketing tools that are unique in many ways and specifically designed for independent retailers. Within the pages of these magazines you will find support or ads for any number of projects or marketing campaigns we are running, as well as issues we want our consumers to be aware of. All Video Buyers Group members that purchase through Ingram Entertainment receive these magazines at no cost to give to their customers. These magazines penetrate thousands of consumer households every month and generate tens of thousands of impressions with the consumers who frequent VBG retail stores all across the country. Evidence of the marketing strength of these magazines can easily be seen from the various promotions VBG offers. Consumers have the opportunity to register by mailing an entry form published in one of these magazines. We are amazed at the number of entries we receive from all across the country. We are very confident in telling our VBG retailers that their customers are definitrely looking at these magazines and taking advantage of the special offers and promotions found in them. We will continue to use these magazines as a marketing tool to support our retailers to address issues and promote consumer involvement with the independent video retailers that VBG consists of.

What we are working on for our consumer magazines:
VID BITS GAZETTE is a consumer magazine announcing new releases along with some oldies but goodies, specials, national contests for your customers and much more. In a number of consumer surveys this magazine was chosen #1 in what most customers look for in similar magazines in the video industry. Vid Bits Gazette is a consumer magazine that is published exclusively for Video Buyers Group members. This magazine is used to promote customer loyalty for independent video retailers and is often used to address issues that may concern the retailers we represent.

There also is a Game Bits section included in the “Vid Bits Gazette” magazines. Video Buyers Group has put forth an extra focus on the Video Gaming Industry to generate extra revenue for our members. Not only will we be putting marketing efforts together to help our members further their profitability in the gaming industry, but we will also be finding ways to tie-in video titles to reach this very important demographic. Each month there will be a section in our “Vid Bits Gazette” consumer magazines that will add additional focus on the new hit titles along with the new gaming systems such as the Nintendo Wii, PlayStation 3 and X-box 360. Because of the high cost of games we expect gaming consumers to rent much more often, which in turn will cause this segment of our business to grow well into the future.

NOW PREMIERING magazines are also a one-of-a-kind monthly consumer magazine published exclusively for Video Buyers Group retailers. One of the advantages of video retail is that we can offer a wide variety of movies, including many titles that are direct-to-video or only having minimal theatrical runs. These titles in fact “premiere” in the video store thus the name for this magazine. This magazine will also be used to promote previously viewed sales, the DVD format along with an informational page. There definitely is an advantage for video retailers to offer a wide range of entertainment to their customers.

TAKING A LOOK AT THE VBG PROGRAM “RENTAL REWARDS”

Under the Rental Rewards Banner.
The retailers who are a part of Video Buyers Group are very diverse in what they offer their consumers. Few have the same name and the locations are all across the country in a variety of markets. What is it that everyone has in common? All Video Buyers Group retailers offer video rental, which is a major part of everyone’s business. All retailers have the ability to use video rental as a marketing tool, meaning all can be involved in a similar manner. With marketing and promotions, added consumer incentives are often used to draw attention and create excitement and involvement of customers. They are rewarded for being involved in any number of ways. Added video rental incentives are most often used by video retailers and are great tools to accomplish a variety of objectives. These are “Rental Rewards,” which is the overall banner VBG uses for most of their promotions that all members can be involved and supported in. VBG retailers can use the Rental Reward banner with just about anything they wish to promote, as well as support what VBG is involved with.

Special marketing tools for Rental Rewards.
Besides being an overall banner for many marketing efforts, tools have been developed to allow retailers the flexibility to be creative and add Rental Rewards to other promotions that would be uniquely beneficial to their individual store. For example, all VBG retailers receive Rental Reward stickers and coupon books. The stickers can be placed on any number of products that would offer the added incentives of a Rental Reward. If in tanning one could place a sticker on a specific type of lotion that would offer a “free video rental with purchase.” The coupons have a special blank space on each so the offer can be written in or stamped on each coupon. Some retailers use the stickers to promote rental activity on a specific group of titles. For instance, this month perhaps Westerns are selected and designated as Rental Reward titles. (Rent any two new release and receive a free Western.)

Monthly Rental Rewards titles.
Each month Rental Reward titles are selected and specially designed posters, to be placed in a high traffic area, are used to promote this program and the titles. Rental Rewards offers retailers the flexibility to promote whatever each decides will benefit them the most. The Rental Rewards coupons can either be written or stamped with your special offer, and the Rental Reward stickers may be put on any items, goods or services that the retailer wants to focus on for that particular month. “Rent one of these tiltes and receive your special offer here.”

Summary.
Coming up with marketing programs that involve independent video retailers who are very diverse in names, products and services offered in all types of markets is no easy task. Add to this the flexibility to allow each individual retailer the ability to be creative and enhance the promotion where it best benefits them, yet be a national program for all to benefit from, makes our “Rental Rewards” program unique in the industry.

YOUR ENJOYMENT IS GUARANTEED

The name of this very successful VBG promotion, Enjoyment Guaranteed, is a bold statement for a video store to make. However retailers across the country are offering consumers that frequent their stores this promise of satisfaction.

In a consumer research project conducted by VBG findings clearly indicated that one of the frustrations consumers felt strongly about was the disappointment of expectations for a selected movie. For a large segment of consumers this was a bigger issue than not finding a copy of a new hit release on the shelf. Put yourself in these customer’s shoes. You decide to go to the video store to grab a couple of movies for the evening. The average time for making a decision as to what to rent and completion of watching the movie is four hours. You enter the store and walk to the new release area to begin the selection process. You will be selecting two videos for the evening, which is the average number of video rented by consumers on a per visit basis. You recognize only 1 of 10 titles available, which is the average that customers have a recall or recognition of from the titles most retailers offer in the new release section (usually the ones that did around $100 million theatrically). Of the titles you recognize you’ll probably find one that you feel like watching for the evening. You grab that one and look for a second video that you probably will know little about. You may ask for help from an employee or even another customer who is also trying to find a second choice. Then you find one that says, “Enjoyment Guaranteed). This one must be good so you take it.

Our Enjoyment Guaranteed program helps the selection process for consumers. As everyone knows not every movie is a mega hit. However there are many mid-range ($20 to $50 million theatrically) that are good films and well worth watching. Consumers want a large selection of video movies at the video store they choose to frequent, even though they consider the selection process a bit frustrating. This is especially true when watching the movie and finding out it was not what they expected or they just didn’t like it. This is a big issue for many consumers, equal to finding few copies of the mega hits on the new release shelves. If competing with a Wall Street chain store (Guaranteed to be There) the VBG Enjoyment Guaranteed program can be a competitive advantage or equalizer as it addresses a major issue consumer’s feel strongly about when choosing a video store to frequent.

Implementing the Enjoyment Guaranteed program is fairly easy. All Video Buyers Group retailers receive Enjoyment Guaranteed mail-in coupons, box stickers, posters and other promotional items to support this program. Each month VBG selects mid-range titles to be a part of this program. Most titles have a theater gross of between $10 million to $50 million. Enjoyment Guaranteed stickers should be placed on the video box to identify these units as a part of this program. Posters also support these selected titles. You can add other titles to this program that you feel may also fit or that you want to draw attention to. Many retailers have developed Enjoyment Guaranteed sections, usually near their new release sections. Others put these titles in the new release section to draw attention to the program. Both ways are effective.

How it works: If a customer does not enjoy the movie, give them the mail-in replacement coupon. They (not you) must then mail this coupon into Video Buyers Group with their rental receipt. Important – Do not give them the replacement rental. Give them the replacement mail-in coupon. Giving the replacement movie rental without requiring the customer to first mail in the coupon can cause abuse of this program. Feel free to tell the customer that in order to have your store involved in this program this required process must be followed.

The replacement coupon sent to Video Buyers Group is processed within seven days. The customer is entered into our database to prevent over use problems, however this has not been an issue to date. Retailers do have the right to stop or limit this program at any time without notice. Once processed a replacement voucher is issued and mailed to the customer. This voucher with the amount of the rental cost based on the receipt sent in is mailed to the customer. A copy is also mailed to the retailer involved for their records and another copy is kept for VBG records to help watch for abuse. The customer then brings this replacement voucher to the store to redeem for a free replacement rental, which the retailer honors. Each voucher is dated giving the customer 30 days to redeem. If it is not redeemed within these 30 days the retailer has the choice to honor this voucher or not.

By following this process only about 10% to 15% of consumers who receive the replacement coupons actually follow through and redeem them. This is called “slippage.” However the perceived value for the consumer at the time of the transaction is extremely high and can be a determining factor for products or titles selected as well as deciding which video store to frequent.

Our VBG Enjoyment Guaranteed program is effective. It adds value, addresses a frustration issue consumer’s consider high and can increase the number of rental transactions on mid-range ($10-$50 mil) titles. Also this program gives a competitive advantage. Above all it is easy to implement and run for our retailers. The Enjoyment Guaranteed program is a VBG exclusive.

NOW PREMIERING, A VBG PROGRAM

Every month we find major hit titles being released to the video industry. These high profile titles are what draws consumer’s attention, but there are many other titles released to video that have far less fanfare. Many of these titles have had a limited release in the movie theatres or are direct-to-video. In fact there are far more of these secondary films than the major hits released each month. These titles offer a wide range of advantages for video retailers as well as the customers that frequent their stores.

From a consumer perspective one of the main reason they frequent a video store is the diverse large selection of films that are offered for their entertainment. Sure the hits are important, however in most consumer surveys conducted one of the main reasons given for selecting one store to frequent over another was variety of titles. This variety was constantly shown to be more important to consumers than even large numbers of copies of the hit new releases. In the video industry there has always been the question, “Is it depth of copies or breadth (fewer copies of the hits but more titles) that is important to consumers and retailers. Over the years it has been proven to actually be a combination of both. The key is finding a balance between having enough copies of the hits while still being able to budget for secondary titles as well. Focus only on the hits and you run the risk of not meeting a high demand of the consumers. Similarly focus only on the secondary titles and you run the risk of having your customers going somewhere else. Video Buyers Group understands this problem and developed the “Now Premiering” program to help members address this issue.

How this program works:
First, there are a large number of secondary titles released every month from a variety of studios, to include the majors. Many of these titles have not been released to the movie theaters, meaning one of the main tools retailers use for their selection process, theater gross revenues, is not available. Often times getting screener copies is difficult and even if you can get them, finding the time to watch them all is impossible. At Video Buyers Group we narrow the list each month via a selection process that works pretty well. Each month six to eight titles are selected to be a part of this “Now Premiering” program.

Second, marketing the titles selected each month. As these Now Premiering titles have had little, if any, exposure in movie theaters and limited advertising budgets, consumers have little if any knowledge of these titles. To support and promote consumer awareness VBG has developed the “Now Premiering” magazine. This magazine helps promote each month’s titles over a 60 to 90 day period of time. For example, titles selected for the month of May will be promoted for the month they are released as well as in the next month’s issue, which would be June.

Also, to support retailers a special “Now Premiering” section has been developed for our Video Buyers Group in-store preview loop. This loop (that all members receive free each month if purchasing from Ingram Entertainment) has two main purposes. First this loop is in our retailers hands well in advance of preorders and is a tool to help in making purchasing decisions. After the titles release to video, this loop becomes a promotional reel or DVD to be used in the video store. By having a Now Premiering section on each preview loop our retailers can see clips of titles that will be a part of the Now Premiering program prior to ordering and then promote these titles to their customers in the store using the same loop.

Besides the magazines and loop each retailer receives monthly, periodically “Now Premiering” stickers are sent out to place on each box to identify the titles included in this program. This helps in developing awareness of these secondary titles and can be used to add other promotional ideas that can enhance this program. For example, “Rent any Now Premiering title and receive a Rental Reward” (another VBG program). You decide what the added value would be.

Finally in “Vid News,” the exclusive publication for Video Buyers Group, a full page is dedicated each month to announce what titles have been selected to be a part of this program. Usually in T.J.’s monthly article about what is coming your way, he gives a little synopsis of each title and the reason they were selected.
Our VBG “Now Premiering” is a unique program to help in the selection and promotion of secondary titles that have proven to be profitable and meets the consumer demand for more variety.

SHELF-TALKER PROGRAM

Shelf talkers are great point-of-purchase tools that draw the consumer’s attention, especially when placed in high traffic areas such as the new release section of a video store. As a new VBG member you will receive specially designed self talker holders. Each month we send out specific materials to utilize these shelf talker holders to promote the titles or programs selected by VBG. If we have your e-mail address you will be notified well in advance of order date for the titles or programs that will utilize these shelf talkers.

THE VBG RENTAL REWARDS DIRECT MAIL CAMPAIGN

The VBG Direct Mail Campaign is truly a one-of-a-kind. No one in the video industry has ever developed a long-term national direct mail campaign for independent video retailers. VBG is the first to make it happen.

How it works:
Every month all Video Buyers Group members receive marketing kits that include a bundle of postcards. On one side of this card is printed information promoting the selected title(s), the advantages of renting movies plus support for locally owned and operated independent retailers. The backside of the postcard is blank for retailers to put the name of their store and location in the return address area, either using a stamp or label. This identifies the store that the postcard was sent from. This postcard also offers a free video rental, excluding new release. Each retailer then selects the area, using zip codes, or a group of consumers to target with this campaign.

Who to mail to?
Each video store has three groups of customers. First is the active or core group that frequents the store on a regular basis. Then there is the semi-active customer that frequents the store from time to time. Finally there is the inactive customer who may be frequenting a different video store, moved out of the area or gotten out of the habit of watching movies. Each group should be targeted with mailing efforts, including the active (core) customers. This is done for a couple of reasons. First and foremost it is a kind of “Thank You” for frequenting your store. It thanks the active customer for their patronage by offering the free movie rental. Secondly, the postcards promote various titles to consumers, causing more rental activity.

The semi-active customer can often be a significant part of a video store’s consumer base. They tend to rent or purchase movies in streaks, floating back and forth from being active to semi-active consumers. They may frequent a store 5 times or more in a month and then not be back for 60 to 90 days. Utilizing a direct mail effort can trigger activity for these semi-active consumers because it is an “out of sight out of mind” issue. Sometimes something as simple as a postcard offering a free rental can get these consumers thinking of watching a movie and back into the video store.

The inactive consumer may be frequenting a competitor, moved out of the area or possibly got out of the habit of renting movies all together for any number of reasons. Life can get very busy especially for families with children. Video retailers compete for the consumer’s time because there are so many options available to spend their free time on. Again it can be the “out of sight out of mind” issue. Targeting the inactive customers with a mailing can remind them of the option of renting a movie and the value that this can offer. Some VBG retailers also use the postcards to prospect for new customers in their area, or pay the extra postage for an “address correction” to see if the customers are still in their area or have moved.

Our Video Buyers Group direct mail campaign is unique and a one-of-a-kind that allows each retailer the flexibility to utilize the postcard in a number of different ways. The postcard promotes the store where it was sent from and the new release titles selected each month, increasing rental activity and sales. Recently a new slogan has been added to the front of the card to promote previously viewed sales as well.

The direct mail campaign is designed to support VBG retailer’s efforts to communicate with consumers in whichever way they feel will be most effective. Consistency in a direct mail campaign can be an important tool for adding to your customer base. (Note: Some local county offices will supply mailing lists divided by zip codes. Mailing lists can also be found on the Internet and some local utility companies will sell lists for a nominal fee).

COUNTER POSTER PROGRAM

In the world of in-store merchandising there are areas where customers congregate or where their eyes tend to focus. These areas are sometimes referred to as hot spots. A good example of this is the checkout counter area. Each counter has a specific place where transactions are usually conducted. Most often retailers place impulse items or informational items in this hot spot. However it’s important that this area be kept clean and uncluttered meaning there are limits as to how many items can be placed on this counter area. 3M, the tape manufacturer, has developed a new stick-on process that adheres to a wide variety of surfaces yet can be removed very easily. Due to this new 3M process and to take advantage of these counter area hot spots, VBG has developed our “Counter Poster Program.”

These specially made eye-catching posters can be placed anywhere on the counter where customers congregate. They are very noticeable and promote new video releases and other information such as sales of previously viewed movies. By using a permanent magic marker each retailer can write any special offer they wish to promote in the designated area of the counter poster. We suggest using a permanent type marker to make the offer clearly visible. However because of how these posters are made, if you wish to change the offer it can be easily erased using a cleaning solution such as “Goo Gone” that can be found almost anywhere cleaning products are sold.

MINI-STICKERS AND 2-WAY WINDOW DISPLAYS

A new 3M stick-on process has opened up new opportunities for in-store merchandising such as our VBG Counter Poster Program. To add to this program many of our retailers requested we develop smaller versions of our posters in order to take advantage of other hot spots that normally are not used such as the back of a cash register or on shelving in the new release area. These mini-stickers are very colorful and eye catching. They also are extremely useful by informing customers of new release titles coming to video.

On occasion, depending on the release and its funding, 2-way window/door stickers are also developed to help with promotion. These stick-ons use a process developed especially for a variety of glass. Once placed on the glass whatever is being promoted can be easily seen from either side of the glass. By using these stick-ons, entry and exit doors can also be considered hot spots.

Prior to placing these stickers on the doors or windows make sure the glass is clean for best visibility and adherence.

Occasionally VBG members also receive other stickers that take advantage of this new 3M stick-on process. They include stick-ons such as “For Sale Previously Viewed” that are reuseable because of this new process and small enough to stick on DVD or VHS boxes yet draws the consumer’s attention.

Besides the programs listed above, we also create many other buttons, pens and numerous p.o.p. materials. If you are a VBG member and would like to get a monthly email with exactly what will be a part of the marketing kit, send me your email address. Just send a message to tjengen@vbg-tec.com and put “add me to the list” in the subject line.