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Allied Vaughn Seeks to Change Physical Media Supply Chain with New ‘Intelligent E-Commerce’ Solution Media Play News

Allied Vaughn Distribution Systems headquarters in Aurora, Ill (Allied Vaughn photo).

February 5, 2024

Allied Vaughn has announced a new “Intelligent E-Commerce” solution it says will help content distributors maximize sales, minimize resources, and optimize profits.

It’s all part of a big push by the Minneapolis-based company to be seen as a one-stop distribution resource for studios as well as independent film distributors involved in the physical media business.

At the heart of this lies Allied Vaughn’s belief that as brick-and-mortar retail space allotted to DVDs, Blu-ray Discs and 4K Ultra HD Blu-rays continues to shrink, e-commerce is an increasingly vital part of any sales equation.

“The migration of in-store sales to online sales fundamentally changes the way we do business and how we reach the consumer,” said Allied Vaughn president Doug Olzenak.

E-commerce accounted for 44% of packaged media sales in 2022, the last year for which full-year figures are available. That same year, Amazon sold more than 100,000 unique SKUs of packaged media titles, while mass merchants experienced significant declines.  With the reduction of shelf space at Walmart stores and the exit of Best Buy from the business in 2024, only a very small offering of new releases and catalog titles are expected to be sold through traditional brick-and-mortar retailers, while e-commerce is on track to continue to sell larger quantities and a wider breadth of titles.

Allied Vaughn says its Intelligent E-Commerce solution is effectively changing the physical media supply chain — providing DVD, Blu-ray and UHD licensing, asset preparation, manufacturing, distribution, and marketing under one roof.

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Reducing the supply chain overhead allows for more titles to be released into the market, resulting in a better customer experience, curated by consumer demand. The optimization of the supply chain not only reduces costs for the studio, but also expands selection and creates efficiency for retailers.

“Inventory surplus of packaged media is more of a problem today than when significant volume hid these issues at the industry’s peak,” Olzenak says. “Liquidation and discount bins diminished the value of intellectual property by flooding the market with overstocks. Matching supply with demand through the use of a minimum inventory and an on-demand supply chain maximizes availability, customer experience and studio sales lift.  The end result is a supply chain in lockstep with the ecommerce sales channels of today and tomorrow.”

Real-time manufacturing, Olzenak maintains, provides a best-in-class retail in-stock rating, cost savings, and a 24-hour ship window. The result is timely delivery that meets the expectations of today’s consumers.

While the traditional in-store supply chain is negatively impacted by the declining market, he notes, Allied Vaughn says its proprietary Intelligent E-Commerce solution is optimized for online sales and integrates both supply chain and sales channel management into one process. Additionally, it eliminates the need for warehousing, creating a more efficient ordering process.

The result is higher net margins using fewer studio resources, Olzenak says.

“Reducing costs and risk while improving the customer experience requires an integrated manufacturing, distribution and fulfillment model,” Olzenak says. “Allied Vaughn provides a model that makes many of a studio’s expenses obsolete. Furthermore, integrating with top ecommerce retailers to eliminate the cost of and time to ship to third party fulfillment companies.  With Allied Vaughn, we replace a complex, antiquated system with one that is lean and fluid.”

While many are aware of Allied Vaughn through its manufacture-on-demand (MOD) model, the company boasts a successful track record in all facets of distribution.

Mike Haney (Allied Vaughn photo)

Mike Haney, Allied Vaughn’s VP of content licensing, notes that over the last 15 years, Allied Vaughn has released more than 7,000 titles from Warner Bros./Discovery, Universal, Paramount, Sony, FOX, MGM and Lionsgate — including such iconic Blu-ray box sets as Universal’s “The Office” and “Parks & Recreation” and Paramount’s “Cheers” and “Frasier.”  Allied Vaughn is one of the only distributors offering 4K UHD TV series such as Paramount’s “Station 11,” “Jack Ryan” and “Reacher” along with classic 4K movies such as Warner Bros/Discovery’s The Outsiders and Giant.

Along with releases from all the major studios, Allied Vaughn licenses and distributes more than 20,000 titles from more than 300 independent distributors. The company has paid more than $200 million in royalties and shipped more than 10 million units to consumers.

“The industry has reached an inflection point,” Olzenak says. “Now is a great time to act to  maximize profits from packaged media for the next 10 years.”

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Thomas K. Arnold

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