LONDON (AdAge.com) -- Tesco, Britain's biggest supermarket chain and the fourth-largest retailer in the world, is adding movie production to its portfolio of ventures, which already includes banking, insurance and cellphones.
The U.K. retail giant has teamed up with newly formed Amber Entertainment to create exclusive straight-to-DVD feature films, based on books by best-selling authors, in an attempt to further boost its share of the home-entertainment market. Tesco already stocks a wider range of DVD and book titles than its competitors, and is unique among supermarkets in running its own DVD rental club. A dedicated website, tescoentertainment.com, is devoted to music and film.
The movie venture's first project, a film of Jackie Collins' new novel, "Paris Connections," about a series of murders of size-zero models, is already in pre-production.
No creative control
Tesco will concentrate on sales and marketing of the films -- and has already started an online competition for tickets to a premiere screening of "Paris Connections" -- but will have no say in the content or the creative process. While the DVD deal is initially for U.K. releases only, Tesco is expanding internationally and did not rule out extending the agreement into its other territories, which include the U.S., China, India and Japan.
Rob Salter, Tesco's entertainment director, said in a statement, "Home entertainment is a big opportunity and we are working hard to develop ourselves as a multi-channel retailer, giving customers the option to buy in-store, online or through our catalog. Partnerships such as this enable us to offer customers even more than a standard entertainment retailer."
Amber Entertainment, based in London and Los Angeles, was created by former executives from Time Warner's New Line Cinema. They include Mark Ordesky, who was executive producer on the "Lord of the Rings" trilogy, and Ileen Maisel, executive producer on the film adaptation of the book "The Golden Compass," starring Nicole Kidman and Daniel Craig.
A spokesman for Amber Entertainment said, "The founders saw a gap in the market for film adaptations of books that work closely with the authors to bring the novel to the screen. Lots of films make more money from DVDs than from theater release, which makes this a successful business model."
More deals planned
Other authors in advanced negotiations with Tesco and Amber include Philip Pullman, Judy Blume, Dick Francis, Karin Slaughter and Anne Perry.
Tesco has already struck a couple deals with movie studios. In November 2009, Tesco secured the exclusive rights to sell Dreamworks' animated holiday film "Merry Madagascar." The DVD cost $8 and Tesco boasted of selling one copy every five seconds over the Christmas period. The retailer is also working with Cinema NX in a promotion in which the DVD of "Me and Orson Wells," which stars "High School Musical" alum Zac Efron, sold exclusively in Tesco stores.
Tesco is one of the U.K.'s most innovative retailers, and no category appears to be off limits. The company's phone business works with all Britain's major wireless networks, and it also sells handset without contracts as well. Its $30 slim Party Phone, sold as a disposable second phone that people can take on nights out without fear of losing it, was a best-seller over the holiday season.
Later this year the supermarket chain, which already offers savings accounts, insurance products and credit cards, plans to open a U.K. bank that it boasts will be "untainted by the runaway bonus culture" that has given that industry a black eye. Tesco's bank will offer a full range of services including mortgages and checking accounts.