Ahead of the Game

When PolyGram Video took over the National Football League’s home-video line in 1992, the NFL’s share of the sports-video market was a meager 5%. Annual sales of the Super Bowl and half a dozen other titles came to fewer than 200,000 units.

Today, NFL videos account for 22% of the sports-video market, according to the retail tracking service VideoScan, with the most recent Super Bowl tape, featuring the Denver Broncos, in line to sell more than 300,000 units.

PolyGram Video President Bill Sondheim has set his sights on resuscitating another sports-video franchise that could use a boost: Major League Baseball, which accounts for less than 7% of the market.

Sondheim is convinced that number could be higher--a lot higher. And with a new five-year licensing pact, PolyGram is out to spruce up baseball’s video image with the same strategy it employed to drive football video sales over the last seven years: Beef up the product with music, kids and brands. Trim the catalog. And, perhaps most important, launch intensive local marketing efforts in the teams’ hometowns, from radio tie-ins to retail partnerships.

“Back when we bought the NFL line, every retailer we talked to begged us not to make the acquisition, because they felt it was a tired line that had no potential,” Sondheim said. “But we took that tired line and turned it into the most successful sports-video line in America.”

With the NFL, one of PolyGram’s first moves was to retool the product. “We created more focused categories,” Sondheim said. “We introduced a line of music titles consisting of sports outtakes set to music that became very strong sellers, particularly ‘NFL Rocks,’ which featured things like a series of great passes and amazing receptions set to Elton John’s ‘Rocket Man.’

“We also reduced the number of titles, cutting more than 100 slow-moving titles like old blooper tapes and 10-year-old team tapes that simply weren’t relevant anymore.”

But the biggest boost in sales, Sondheim said, came about through PolyGram’s localized marketing efforts, funded in large part through promotional partnerships with sponsors ranging from Wheaties cereal to Castrol motor oil.

“We created a home-team retailer program in which we utilized NFL season tickets in each of the 28 home markets,” Sondheim said. “We contacted local radio stations and went to retailers with strong clusters of stores in those markets and set up season-long promotions. Tickets and videos were given to retailers who positioned the product aggressively.

“That built our skills in local promotions and marketing, which became very helpful, because 75% to 80% of Super Bowl titles sell in the market of the team that wins.”

With baseball, Sondheim realizes he has a lot harder sell on his hands than he did with football. “I see more kids admire NBA players than baseball players,” he observed.

But he’s full of ideas. As with football, the first order of business will be the product.

“We’re going to trim the catalog and look at repackaging some of the older titles with newer footage and more up-to-date graphics,” Sondheim said. “Then we’re going to try to determine which categories or sub-lines seem to be performing well, and add to them.”

Developing a nostalgia line is imperative. “Baseball has more history than any sport in America,” he said, “and there should definitely be a video record of that.”

Also high on the priority list is a children’s line. “Baseball is one of the most active youth-participatory sports in America,” he said. “There are fun ways to make players more accessible to kids.

“For example, there are players who are fun and wacky and silly. I can see us taking a series of blooper tapes and shooting additional footage with these players and kids goofing around and playing baseball, something kind of hip and irreverent.”

Then there’s music, which Sondheim, based on his experience with “NFL Rocks,” calls “one of the best ways to reach teenage audiences.”

“A ‘greatest hits of baseball’ is a natural,” he said.

On the marketing front, PolyGram will focus on localized efforts.

“In fact, with two lines coming under one roof, we have the opportunity to have yearlong relations with our retailers and promotional partners,” Sondheim said. “Theoretically now, we can go to retailers and get them to dedicate square footage to us year-round and merely rotate the season in play with product and signage.”

The prospects of having yearlong deals with promotional partners also appeals to PolyGram, since the low cost of sports videos--they sell for as little as $10 each--leaves little room for big marketing budgets.

“On low-margin product, promotional partnerships are crucial, because you certainly aren’t generating significant consumer media dollars on your own,” Sondheim said. “We make maybe $2 a unit in profit, compared to the $50 profit margin the big studios get on rental-priced movies, and that makes it a lot easier for them to spend aggressively.”

The Major League Baseball deal is just the latest in a series of steps PolyGram Video has taken recently in its quest to become the “seventh major” home-video supplier.

In January, beginning with “The Game,” PolyGram began distributing all videos released theatrically through its newly formed theatrical sibling, PolyGram Films. Other high-profile theatrical releases due this year include “The Big Lebowski,” from the Coen Brothers (“Fargo,” “Raising Arizona”); “What Dreams May Come,” starring Robin Williams; John Grisham’s “The Gingerbread Man,” and, for children, “The Borrowers” (which opened earlier this month) and the first movie featuring Barney the dinosaur.

Last year, after successfully marketing acquired or licensed children’s video properties such as the X-Men and the Mighty Morphin Power Rangers, PolyGram played a key role in developing its own children’s show, “The Crayon Box,” which debuted on PBS in the fall. Video release dates for the show, a joint venture with Random House, have not yet been set.

PolyGram Video was originally established in 1991 to distribute long-form music videos for its sister record companies, which include PolyGram, Mercury and Motown. Its first year in business, the new company’s billings amounted to less than $10 million.

Last year, Sondheim said, PolyGram Video sales hit $150 million--and this year, buoyed by the infusion of theatrical product, he expects to top $200 million.

“Over the last seven years, we’ve seen several different businesses develop--special interest, children’s and now theatrical,” Sondheim said. “Each year one business has come to the forefront, but this year, all of our segments seem to be poised to have record-setting years.”

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Sporting Goods

Sports-video sales comprised only 1% of the 267 million videos sold in 1997. Market share and top sellers in 1997:

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Rank Title Label 1 Football: NFL Super Bowl XXXI PolyGram 2 NHL/’97 Stanley Cup Championship Fox 3 NBA/’97 Finals Championship Fox 4 Basketball: Michael Jordan Fox 5 Hockey-Alltime Allstars Prism 6 Basketball: NBA at 50 Fox 7 Major League Baseball: 1997 World Series Orion 8 Son, Hero & Champion--Tiger Woods Fox 9 101 Sports Bloopers PPI 10 Highlights of Masters 1997 Tournament Warner

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Fox: 24.64%

PolyGram: 21.43%

Warner: 10.19%

Other: 43.74%

Source: VideoScan Inc.