We are often asked by clients how much they should price their DVDs. My first response is to ask the client which distribution channel are they referring to?
Depending on the content and target audience, a film may have multiple distribution channels, and therefore, require different licenses and/or different versions for international markets. While the most common DVD license is the one sold to private home viewing, other types of licenses include: institutional, community, and public screening. If you are planning to sell through wholesalers and distributors, a volume-based discount is required. Also, if you plan to sell internationally, different versions (NTSC, PAL) of the DVD may be necessary.
Licenses:
-Private home viewing (retail pricing, wholesale pricing)
-Public screening
-Educational/institutional (tiered pricing for different size and entity)
Versions:
-NTSC
-PAL
-Secam (not frequently mentioned)
Region Code:
-Restricts where geographically the DVD can be played: 0, 1, 2
Private home viewing license (”retail” price)
The price of a private home view license, or the “retail” price of the DVD, depends on multiple factors. We suggest clients to price their DVD within the market range of similar DVDs (topic/category, duration, extra content, bonus features, etc.) As a point of reference, I suggest that they surf around the web (on Amazon, other indie film sites, Neoflix catalog).
Clients have ask if they should price their DVD higher if they’ve won awards. My general impression is that awards and good reviews only help to move products but not necessarily increase the perceived value of the DVD. The closest example I can provide is that movie theaters don’t charge more for the price of a ticket just because a film received more Oscar nominations. Good press helps to bring more ticket sales, and it is more important to consider this from the perspective of how much will the market bear for a DVD, rather than whether you can price it higher than the next DVD who hasn’t won awards. If a DVD is priced too high, it will retard sales–regardless how many award it has won.
Private home viewing license (”wholesale” price)
If a client is fortunate enough to have individuals, groups, stores or companies willing to re-sell their DVDs, then the question is price. A whole The pricing for whole sale is even more subjective than establishing retail. To keep things simple, we suggest clients use two primary functions for wholesale: volume and price. The more volume, the greater the discount.
A common concern clients have expressed is having a reseller buyer fifty DVDs and put it on eBay. While the likelihood of your DVDs appearing on eBay for $8 below your selling price is fairly remote, it’s very possible that wholesalers undercut your pricing and you start receiving messages from customers wanting a price match. With resale/wholesale, we suggest clients establish guidelines for the reseller/wholeseller regarding the pricing they may distribute the DVD so there is no ambiguity or misunderstanding.
Here are Neoflix clients offering different resale/wholesale pricing, for reference:
Note By Note
Dr. Bronners Magic Soap
Occupation 101
Keep in mind also, that most clients make side deals with resellers depending on the strategic circumstances and relationship.
Public screening license
We’re in the process of gathering more information about public screening in order to blogabout it intelligently. I hope to come back to this section with more useful information within a few weeks.
Education/Institution/Organization Licenses
While there are established distributors for educational or institutional sales charging a set catalog price per license, a DIY client has the flexibility to sell different licensing that fits the organization. Institutions come in many different sizes (number of members) and business entity (profit or non-profit). While it may seem complex at first, there is really a simple 2×2 or 2×3 matrix.
For example:
Non-profit + Under 50 people: $50
Non-profit + 51-200 people: $150
Non-profit + Over 200 people: $250
For-profit + Under 50 people: $100
For-profit + 51-200 people: $200
For-profit + Over 200 people: $250
For-profit + over 500 people: $350
I believe pricing based on the organization’s membership and entity make for a fair approach (and more importantly, a manageable formula) to establish tiered-pricing. For example, you want to price a license for a large university library like Yale or Berkeley differently from say, a local non-profit community group with twenty members. To get additional feedback, clients have also contact institutional/educational distributors like Bull Frog (for environmental-related films) and New Day.
Here are Neoflix clients offering different institutional licenses, for reference:
Lumo
Little Man (via Reel Indies)
Mystic Ball
Region Code
If a client does not have foreign distributors, we suggest to them that to keep things simple, encode the DVD in region “0″ so it is viewable anywhere in the world. I’ve been asked what happens when a client finds foreign distribution after they begin self-distribution? If a Neoflix client signs with a foreign distributor after they have already made DVDs, our platform gives them the ability to restrict shipping to certain countries or regions. Since the foreign distributor’s biggest concern is losing sales to the filmmaker’s site, this usually placates their concern.
