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Best Buy to Change DVD Strategy

ICv2 reports, and ANN has confirmed via other sources, that Best Buy will be changing their anime strategy to focus on stores where anime has performed well historically. These stores will continue to carry a full selection of anime titles, while other stores will cut their selection to only the top selling anime.

The selection will be cut at approximately 800 stores out of Best Buy's just over 1,000 (1,006 as of February 19) stores in the USA. Of these, 461 stores will carry only the top-20 titles.

According to ICv2 and confirmed by ANN's sources, the stores where anime is being cut account for only a very small percentage (less than 20%) of overall anime sales at Best Buy. The remaining 540 stores will carry over 100 anime skus with the top 200 of those stores continuing to carry a large selection similar to what they currently carry.

Best Buy will divide their catalog into A-List titles, B-List titles and C-List titles, based on sales performance. The A-List anime titles will be the top-20 performing anime and will be carried in all Best Buy locations. The B-List titles will be carried in 500 stores nationwide, and the C-List titles will only be carried in the top 200 stores nationwide.

Opinions on the news have been mixed. John Sirabella, CEO of Media Blasters, stated on Anime on DVD, "Unfortunately the ramifications of this will be bad, real bad. You are looking at a market that already lost most of the major players." However one anonymous source states that the stores where the anime selection is being cut are not profitable for anime publishers who are losing money on returns from these stores.

The restructuring of Best Buy's DVD sales is not limited only to their anime products. In January Mosaic Sales Solutions informed Best Buy suppliers that they would be returning 5.5 million DVDs on behalf of Best Buy. The average number of DVDs returned per store was 5,505 across on average of 1,857 skus per store.

Bandai Entertainment's Ken Iyadomi confirms that Best Buy's changes are not only to their anime business but to their entire DVD business. "This will be good for the business, but it will make it a little harder to sell the less popular titles," states Iyadomi. "This is part of the reason we're changing our operations to focus on our A-list titles."

Consumers in smaller markets will be the hardest hit as they may see their local anime selection cut with no "top performing" store in their vicinity.

No source has been able to inform us how much they expect Best Buy's total anime sales to diminish as a result of this move.

ICv2 points out that Best Buy is the largest anime retailer in the USA for titles not carried by Walmart, and that the current news will not change this.

The 461 stores that will be cutting their selection to A-List-only titles will be holding a clearance sale with their usual prices reduced a further 50%. The sale will run from March 1 to March 21.

Update: ANN has learned that the list previously included in this article was preliminary and is subject to change. The final list of stores is not yet available.