Box Office Obscurity: Video sales and rentals, once big business, becoming a niche market

Jun. 27—Video stores in Owensboro are few and far between these days.

That wasn't always the case.

Go back 20 years, and places like Hollywood Video and Blockbuster were common in town, and you could find at least a couple mom and pop video stores on places like West Parrish Avenue.

That was back when DVDs (and VHS tapes before them), were big rental business. But streaming services such as Netflix and Hulu brought most of the big movie stores down — and the disaster that was 2020 didn't help.

The last Family Video in Owensboro closed earlier this year, when the chain was pushed over the edge by the COVID-19 pandemic.

But there's still a market for movies, and stores in town to serve collectors.

The Money Tree Book and Music Exchange at 1421 Triplett St. has thousands of DVDs and Blu-Rays. Star Trax, at 2430 East Fourth Street, has towering stacks of DVDs, Blu-Ray disks and even VHS tapes.

"We've had people from Alaska," Star Trax owner Steve Grimes said. One customer from out of town "comes in once a year, and he always comes here. We had a guy from Britain come here."

Movie collectors are usually people on the hunt for specific genres, or certain titles within their favorite genre, Grimes said.

"They like to hit shops that know what they're looking for," Grimes said.

Eureka MomentWaxWorks/VideoWorks used to be a major distributor of movies to rental stores, company President Terry Woodward said.

Back then, in the late 1970s, Waxworks was dealing with VHS tapes and competing brands, like Betamax.

"When it started, it was just movies for sale, and it was very expensive," Woodward said. "It was $50 to $60 (a tape), and we weren't selling many."

But someone, somewhere, had a eureka moment: People who didn't want to shell out big bucks to buy a movie might instead be willing to cough up just a few bucks to rent one for a day or two. Whoever came up with the idea, he or she

was right.

"When rentals started, that was when it really boomed," Woodward said.

WaxWorks jumped headlong into the business, and became a major movie distributor.

"We were one of the first distributors that carried every major studio," Woodward said. "At one time, we had 5,000 to 6,000 accounts" with rental stores, he said.

The arrival of the DVD on the market changed the industry, with chain stores getting into the business in a big way, Woodward said.

"Blockbuster came along and started putting the independents out of business," Woodward said. "Then Netflix and Redbox came along." Before it was a streaming service, Netflix was a movie rental by mail service.

The movie studios, Woodward said, had always been lukewarm to the rental business, and studios were never that excited about mass-producing DVDs. So when streaming services came along, the studios saw a chance to get out of the DVD business, Woodward said.

"It's much easier for them to stream" a movie, he said. That means movies a studio doesn't release to an Amazon or a Hulu will likely never see the light of day again, Woodward said.

"A lot of these older movies will never be found online," he said.

Streaming drove a nail into the coffin of the chain video stores.

"Brick and mortar stores are pretty much gone," Woodward said.

Instead of being a mass seller, Woodward said WaxWorks' movie business became more a a niche market, selling some classic films to Walmart, and to places like museums, Hallmark stores and stores that carry sports DVDs. The company also sold to third-party sellers, who would buy from WaxWorks and then resell movies on sites like eBay.

"I don't think it will (go) 100% away," Woodward said, but DVDs will largely sought by collectors, like "a parallel to the CD market," Woodward said.

Specialized and Collectors MarketsStepping into the Book and Music Exchange or Stat Trax feels like taking a trip back to the 1980s.

There's a scavenger hunt aspect to a good video store, and there's fun in finding something totally unexpected, or even a bit rare.

Sure, a horror fan perhaps was looking for "Hereditary" or a John Carpenter film when she stepped into The Moneytree or Star Trax ... but a really good day is when she walks out with something random and totally unique for the collection, like a remastered edition of "Q: The Winged Serpent," a two-film "My Bloody Valentine/April Fool's Day" set on DVD or even an infamous film from the British "Video Nasties" list, like "The Burning."

Bill Fry, manager of the Money Tree Book and Music Exchange, said movie sales make up about a fourth of the store's revenue, behind things like video game and vinyl record sales.

Movie sales actually went up at the store during the pandemic at the Money Tree. "Pre-COVID, movie sales had dropped, which is one of the reasons Family Video went out of business," Fry said. While streaming services abound, "people got tired of streaming when COVID hit," Fry said.

Customers come to the store from out of town, particularly from rural areas where streaming isn't an option, Fry said. The store trades DVDs, so some customers come back to trade week after week, Fry said.

Even people with access to streaming services like Amazon sometimes just prefer to buy instead of renting online, Fry said.

"You could probably buy it for $3," Fry said.

Star Trax's business was changed dramatically as people moved away from video rentals, Grimes said.

"Our business used to be 90% rentals and 10% sales," Grimes said. "Now, it's like 5% rentals and 95% sales.

"If we just rented movies, we'd be gone," Grimes said. "People ask, 'why are you selling everything? Are you going out of business?' I say, 'no, we are trying to stay in business.' "

The DVD (and Blu-Ray) market has become largely specialized, with people seeking Disney movies, or westerns, or TV series collections. But the major collectors market is in genres like sci-fi and horror, Fry said.

"There are people who will come in and will buy some kids' movies ... but the majority of our buyers are niche buyers," Fry said. Horror "was kind of a nice genre, but it has exploded."

Horror "is the biggest part of the market," Grimes said. Star Trax even carries VHS tapes, for collectors looking for particularly obscure genre films.

"It's primarily the horror movies that they can't find on DVD or steaming," Grimes said.

Because they're used, the movies at both stores are pretty cheap. It's nothing to walk out of Star Trax or the Money Tree with an armful of movies for $15 or $20. The more uncommon items might cost a bit more — but to a collector, paying $10 for the obscure 1970s oddity "Let's Scare Jessica to Death" or for the "steel box" two-disc set special edition of "The Texas Chain Saw Massacre" is no big deal.

There are even subsets within the horror genre that collectors grab up.

One of Grimes' customers last week was purchasing horror movies centered around giant grizzly bear attacks (and don't ask me about my ever-growing collection of "Godzilla" movies — or do ask, I don't mind).

The pandemic seemed like it would bring doom to all video stores.

But, like Fry at the Money Tree, Grimes said Star Trax was able to stay in business through movie sales. Grimes said, when not at the store, he is checking out flea markets and other outlets for movies.

"I never dreamed we would be able to survive. We went a year without new movies" being released, Grimes said. Before the pandemic, "we were primarily focused on new movies," but now the store deals mostly in used movies.

"I have lists of movies people are looking for," Grimes said.

The future is impossible to predict, of course, but Fry said the movie market will likely become even more of collectors market in the future, as streaming services expand.

"I have been saying for years, the moment you have reliable, high-speed internet in the rural areas, the market (for DVDs) will bottom out," Fry said. "But you are always going to have a market for collectors.

"I don't think it will be like vinyl," Fry said. "I think it will be more like resurgence of cassettes, where people collect cassettes because it's cool."

James Mayse, 270-691-7303, jmayse@messenger-inquirer.com, Twitter: @JamesMayse

James Mayse, 270-691-7303, jmayse@messenger-inquirer.com, Twitter: @JamesMayse