Hi, I am thinking about openning up a physical adult store that strictly caters to Adult DVDs, such as a huge rental section, used dvd trader section, and new dvds at a lower cost than normal retail stores. Basically a store like Blockbuster, but an adult theme.
I just want your honest opinion about the possibilities of this type of business working out.
My main concerns are:
1)will the mail order rental market cut into my rental profits? 2)is the average joe hesitant to be seen walking into an adult store and rather buy online? Are the physical store fronts a way of the past and regular customers would rather go online to be more discreet?
1) I'm sure the mail order business has cut into retail sales, however they haven't closed any stores in my area. I'm not sure what the numbers are, but I believe rentals are a large part of the business for the locals. Also, depending on the outcome of the 2257 lawsuit, online retailers may be forced to forego using images, which would seriously hurt their sales.
2) I have no idea how hesitant the average joe is, but location and discreet parking/entry can take care of that.
You forgot the third issue, which is how folks will feel about you opening an adult business in their area. You'll find many places have no desire to see adult stores in their area and will use zoning to prevent you from gaining entry and/or law enforcement to harrass you into leaving, or at least contributing handsomely to somebody's campaign/retirement fund. Give generously to the policeman's association!
I think that a lot depends on the area that you are looking to open a store.
My guess is that, if you have a good selection of inventory, the Online rental stores won't really be your competition. I think that most people rent online because they don't have a good local option (at least the good local stores are why I don't rent online).
On the other hand, the online stores will definitely be your competition with regard to sales. However, that will also depend on your clientelle.
There are stores local to me that are on major roads and have very visible presences. All of these stores have one thing in common. They go out of their way to cater to women. Their window displays contain lingerie and the displays are changed regularly, often themed for the season on an upcoming holiday. There is a large selection of lingerie and other clothing, shoes, boots, etc... at the front of the store. They also have a large selection of toys and novelties.
Although they also have a large selection of movies, you go past the other sections to get to the movies, not the other way around.
These stores cater to the person who drives by every day and decides to stop in. As such, they have a higher sales to rental ratio. They also can charge more for their DVD's, because their clientelle is not as savvy as someone who spends more time in adult video stores.
Appearance of these stores, both inside and out is of utmost importance.
The other kind of store is the type that just has movies and toys. These stores are generally off of the main roads, possibly in an industrial park in a portion of a converted warehouse. Appearance is not as important, but does help. Here, you will get more regular renters and buyers. You can't charge as much as the first type of store because your clientelle will be more aware of what the competition (if there is any competition) is doing. However, with these people, you will make up in volume, what you lose in lower prices.
Being "off the beaten path" also makes it easier for people, who would otherwise be embarrassed to go into one of these stores, to come into yours.
This sounds like an awesome idea to me. If there was an adult store like that around here, that had a nice selection of both rental and used DVDs, and sold new releases at a price that competed with the internet ($19.95 - $24.95 even) I would probably never leave.
I would be willing to travel even to go to a store like this, because they are so rare around here. Most adult stores are very far away, have bad selections, and they sell DVD's at highly inflated prices.
Please tell me this store will be opening in the near future in OH, KY, or IN.
Just out of curiosity - why not do both? I mean - you sound like you are willing to try to compete with the online mail order vendors from your brick-n-mortar store. All you'll need to get some mail order business of your own, would be the website - right?
Sounds like you'll already have the inventory, etc. What the heck - sell some of it online too. :)
I think an adult dvd store can work. If things work out, the store would consist of 70% rentals and 30%sales. My rental section will be up to date and cater to my customers interests. The sales would consist of brand new sealed dvd's and a used section.
I feel since it is only an adult dvd store, and have no private booths and sexual toys in the store, the city will not give me too much red tape to open up.
I was just curious about everyones opinion if the online rental business would eventually make the physical stores go extinct.
I doubt that online shops will ever make physical stores extinct. Just like online shops haven't made mainstream stores extinct. With the 2257 changes, physical stores might even become more popular. If physical stores were competetively priced with online ones I'd shop at them more often.
I think local competition is going to be your main concern, not online. New fine Arts was the only store within 25-30 miles of me, I used to pop in there occasionally. There were always boatloads of goobers buying stacks of DVDs priced at 2-3x what you'd pay online. There are still tons of people wearing foil hats that fear online shopping. Also, a lot of people do not have a good option for safely shipping pornographic materials.
I would love to see a local store that had a selection of titles and perhaps a rental program that competed with the better rent-by-mail companies, and prices on rentals and sales that were competitive with online shops. The adult stores in my area tend to charge twice as much as an online store for the same titles, which is the main reason I make most of my purchases via mail. On top of that, none of the stores that specifically deal in adult material offer video or DVD rentals of any kind - I would have to go to one of the local mom and pop video rental shops for that, and none of them can compete with the selection rental companies like Bush or XRent offer.
I think physical Adult stores count on 90% of thier sales on internet shy or oh wife/girlfriend/husband is gonna find out if I get package/have charge on my credit card business. Therefore they will never ever go away, let those guys pay $30 for an old Metro DVD from 98' not me.
I havn't been to a store in 2 years, mainly because of reviews.I'm just not interested in 95% of the stuff that's out there, and typically that 5% I do like will be rented out when I get there. The days of settling for crap based on the box cover are over. I think they survive on guys/couples who just want a fuck vid, any fuck vid.
Brick and mortar adult DVD stores cater to a different kind of porn consumer than online rental shops. For example, at WantedList.com we target customers who want a much larger selection than is physically possible at a local store, as well as those who want anonymity, which can't be had when walking out of a video store with a black plastic bag after perusing the back room.
With a physical storefront, you'll get a lot of people who are impulse buyers - the store's there, they see something they like and they pick it up. You'll also get those who prefer being able to handle a physical product before making a purchase - many people are still skeptical of the Internet, or find shopping to be a leisure activity, and may even enjoy chatting with the local store owner or cashier about his or her purchases.
Before you open up shop, be sure to check with your town about zoning regulations - most townships frown on adult shops and require video stores to have 60%-70% or more mainstream inventory, with less than half (many times much less than that) as adult. Compute your overhead including rent, inventory and labor. Choose your inventory carefully - you will only have space for a certain size selection, so you'll want to include a well-balanced mix of high end studios, bargain movies, genres and probably a gay-only and/or she-male section. You should also carry toys and lubes.
If you're deciding between storefront and online, I would suggest choosing one or the other - not both, unless your model is strictly sales based. Running an online rental business is an entirely different animal than a physical storefront. If you do go online to sell your merchandise, don't try to cover the whole spectrum with one copy of each title - choose a niche and go many pieces deep for every movie. Otherwise you'll be wasting countless hours and dollars on labor to input data and scan covers for movies you won't have in stock for very long.
My opinion only - I hope you found it helpful in making your decision. Best of luck!
