How DreamWorks Misjudged DVD Sales of Its Monster Hit

Thursday, June 2nd, 2005

DVD sales are becoming more like box-office numbers: more than half of sales come in the first week. From How DreamWorks Misjudged DVD Sales of Its Monster Hit:

Five years ago, a typical new DVD release would rack up about one-third of its total sales during the first week of release; the figure was even lower for animated movies, which tended to have longer legs. DVD sales would then steadily mount over weeks or months. But these days, DVD releases are generating a huge percentage of their total sales — typically over 50% and in some cases, up to 70% — in the first week.

The reason for the change: intense competition for shelf space, as both movie studios and TV producers unleash a flood of new discs every week. DVD sales are now mimicking the big-bang nature of the theatrical business, where movies make most of their money in the first few days before being knocked out by a slew of newcomers.

When a DVD title stops selling, major retailers are quicker these days to send unsold copies back to make way for new titles. So while DreamWorks shipped tens of millions of ‘Shrek 2′ discs, retailers started returning them once the title showed signs of running out of gas. ‘Shrek 2′ sold 33.7 million DVD and VHS copies world-wide in its first eight weeks — but only 1.3 million in the first quarter of 2005.

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