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GAY PORN FEEL PRICE MODIFICATIONS IN WHOLESALE NUMBERS
By: Andy Powell, Staff Writer - 05-04-09 - 12:00 a.m. PDT
Remember the days when wholesale prices to retailers top $ 89.95 Per unit?Those were the days when not only having gay porn was a risk by selling it either in viewing at a commercial establishment or selling and renting gay porn in your retail store was a guaranteed fine and imprisonment.
Working in the JRL Charts department gives us an insight as to what is going on in retail stores nationwide. I wanted to cover a few issues that have been very alarming for our marketplace over the past four consecutive quarters.
PRICE MODIFICATIONS
When the 90's hit the market place, wholesale prices had been slashed in half. Back in those days, there were only a hand full of gay porn studios available to gay consumers. Falcon, COLT, Nova, Catalina, YMAC, and Bijou were among the main players that gay men had to choose from for their adult entertainment.
While the straight market was vast expanding, the gay genre was still a very selective group of companies covering the entire United States. In those days, we didn't have pay per view, online streaming, membership web sites that were available to us 24 hours a day, 7 days a week.
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Revenue was generated solely by Adult theaters and retail stores!
Veterans of the Gay Porn Industry have known for some time that once gay porn was accepted in the mainstream of adult entertainment that prices would go through another modification.
With wholesale prices approaching equal it's sister genre heteroxexual adult porn, it's no surprise that many studios are going through the realities of being in the mainstream of adult entertainment. The more product that is available, the more the prices will drop. This is with any product on the open marketplace.
WHOLESALE DISTRIBUTION
While mega distributors still keep their prices at their profit margin, they have had to make modifications in sales incentives to keep their vendors supplied with their exclusive labels as well as independent labels that are attempting to penetrate the gay porn market.
We will have studios closing shop and you will have budgets cut, but, in the long stretch, the market will correct itself just as it has had to do twice before. The more retailers that begin to carry gay porn for their gay clientele, the more units distributors as well as independents will be able to push out the door.
With over 250 gay porn studios in the business compared to 5 to 10 in the 90s, 80's and 70's, price reductions were bound to happen.
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According to retailers, they are looking for gay titles in the same price range of your top of the line hetero porn titles. Certain studios do keep their prices firmly at their profit margin, but you have a vast amount of studios that are caving into retail store pressure to move the units out the door.
RETAILER THOUGHTS'
The climate says it all, from retailers stating that business is slowly starting to pick up, you still have retailers who feel that online streaming is hurting their marketplace. Then you have studios who feel that pay-per-view revenue isn't what they thought it was because the pay per view outlets have so much content that it's difficult to navigate through to find their product. That's if they are looking for your studio in particular.
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Catalog sales haven't increased at all over the past year but retailers are demanding more competitve prices for name brand gay porn feature films.
Online pay per view companies have also felt the pinch of the recession as their memberships have drop off by as much as 35% due to gay consumers credit cards declining on renewal. Consumers are maxed out on their credit cards and are barely able to make their minimum payments.
This results in revenue lost for online merchants who heavily depend on that monthly revenue to sustain their costs.Everyone will blame the other for why sales are down but the truth is, the marketplace is going through a major overhaul and once consumer confidence begins to turn upwards, sales will begin to pick up and retailers will begin increasing their wholesale orders again.
Plus, online membership gay porn web sites will see an increase in memberships once more.
With over 300,000,000 people in the united states and according to statistics, gay people make up 10% of the population, that means we have at least 28,000,000 gay consumers to target for gay adult entertainment. (You have to take off several million because not all gays and lesbians watch gay adult entertainment).
MASSIVE SALE PANIC NOT RECOMMENDED
One thing to be very carefull of is selling your inventory at a major reduction in price. This will hurt your label more than you know. Once retailers purchase your goods far less than the market value, they will expect for every one of your releases to be available to them at the same price.
You will have a huge problem convencing them that they need to pay their old price for your titles once you've given them a massive discount on your previous releases.
Be smart in offering catalog deals! Because once you've dropped the price, they will never go back up again. Even placing a new scene in the movie or extras that weren't available in the original version, will not motivate retailers in spending top dollar for that film.
This has been proven repeatedly over the years!
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When attmepting to get a new retailer to carry gay porn is another challenge because, you have to convince them that they will turn a nice profit by paying double for gay porn than what they pay for in hetero porn. The first thing they want to know is, what do you have for $ XXX dollars per unit.
To gay porn distributors, this is shocking because the trend has always been double the rate of heterosexual porn.
The best advice is to watch your budgets, maintain an open communication with your vendors, make sure to have promotional projects to help push your projects and/or products to retailers and gay consumers.
GAY PORN WEB SITE START-UPS DAILY
One thing that drives online retailers crazy is the amount of competition they have on the worldwide web. You can go into google, msn, yahoo and aol 12 hours out of the day and find hundreds of gay porn web sites, gay porn video on demand sites, gay porn video buys and on and on!
This is also very difficult for webmasters to try and expand their reach in our marketplace. You have to sustain a constant marketing campaign for gay consumers to find you on a daily basis.
Our industry is still young and we can only get bigger. With gays and lesbians coming out more than ever in our life times, that can only generate revenue for our industry because you'll have more gay and lesbian consumers coming out and being comfortable with buying their true sexual fetish without feeling that they need to conceal it.
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