Original Videos Still a Small Industry

Five or six years ago, when home video was still a fast-growing infant, some were predicting it would become a haven for original programming. How-tos, forecasters insisted, would be a dominant force. So would videos about such subjects as exercise, cooking, comedy, music, handling your own divorce, etc.

So what happened?

Movies took over. Original programming is still just a small part of the business--less than 20%, said Jim Jimirro, president of J2 Communications, which markets the hit comedy video “Dorf on Golf,” starring Tim Conway.

“The original programming market never opened up like people thought it would,” said Jeff Peisch, vice president of nontheatrical programming at Vestron, which put out “The Making of Michael Jackson’s ‘Thriller’ ” in 1983, a smash hit that sold more than 500,000 copies and created great expectations for original programming.

Now, selling just 10,000 copies of an original program video through various outlets is considered impressive. That doesn’t compare well to the figures for movies: 200,000 to 300,000 copies of the latest hit movie usually are shipped to video outlets.

What happened is that video retailers went with what would make them the most money: renting movies. And not just any movies, but A movies. B and C movies, popular in the home video market a few years ago, have lost their luster. According to a recent study, there was a 10% decline in dealer purchases of B and C titles last year.

“They’re just buying more rental copies of the major movies,” Peisch said.

According to industry estimates, there are about 6,000 original programming titles, selling for $15 to $30. But only a small fraction ever show up on video store shelves.

“Many stores will stock the very popular ones--like exercise tapes by Jane Fonda or Kathy Smith,” Jimirro said. “But most of the others don’t have a chance.”

Overcoming the rental fixation of many store owners is another significant hurdle for original programming video companies.

“Stores stock original programs to sell them,” Peisch said. “Many of the small retailers are just into rentals. They don’t want to be bothered with sales. That’s changing, but it’s keeping some retailers from exploring original programming.”

The primary problem in selling original program videos is merely getting them exposed to potential buyers. One answer is alternative outlets to video stores, such as mail-order catalogues, bookstores and specialty stores.

Explaining how “Dorf on Golf” sold more than 200,000 copies, J2’s Jimirro said: “We sold a lot to golf shops. It’s creative marketing. You have to put these special-interest tapes where they’ll be seen by people who are interested in the subject.”

Catalogues are a primary outlet for original programming videos.

“Sales through catalogues are about 10%-15% of the original programming market,” Jimirro said. “Getting space in certain catalogues is very important. For some tapes, it’s their only outlet. That percentage should go up to about 25% in the next few years.”

Other possible outlets for original program video companies are the mass merchants, such as Target and K mart--which are figuring heavily in home video sales these days. But there are drawbacks.

“Mass merchants have limited shelf space too,” Jimirro explained. “Also, they prefer titles that are of general interest--that appeal to a large share of the market. That cuts out a lot of titles.”

Video companies have found that using celebrity hosts is a real marketing boost for original programming titles. Paramount, one of the few majors that’s active in this market, has two $24.95 tapes due out in April hosted by stars--”When Mom and Dad Break Up” (Alan Thicke) and “How to Stop the One You Love From Drinking and Using Drugs” (Mariette Hartley).

“Stars enhance consumer appeal,” said Paramount vice president Hollace Brown. “They can help promote the tape too. They can get media attention and industry attention for a tape that wouldn’t be possible otherwise.”

Commercial sponsors, rare in original programming so far, may be used more frequently--particularly by big video companies that have the clout and the money to arrange such deals. For instance, Michael Jackson’s new “Moonwalker,” on CBS’s music video company, includes a Pepsi ad. And Paramount’s Brown hinted that commercial tie-ins are in her company’s future:

“Some things are being worked on. I can’t say more than that. Linking a tape with a sponsor helps in advertising, promotion and gets exposure for the tape. For major original programs, this could be the wave of the future.”