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RCA Press Release for April 7, 1983

Company Reports VideoDisc Player Sales Are Double The Level Of A Year Ago

With sales of its video disc players running more than double the level of a year ago, RCA announced today the signing of entertainer Gene Kelly as the company's spokesman for the RCA VideoDisc system.

Mr. Kelly, whose entertainment career has ranged from acting to producing for the stage, movies and television, will appear in RCA magazine advertising that begins April 25 in 19 national consumer publications. RCA last used a celebrity spokesman in the early 1960's.

A strong first quarter sales performance by the major video product categories also included a surge in video disc player sales to dealers, noted D. Joseph Donahue, Vice President and General Manager, RCA Consumer Electronics Division. "Additionally, RCA is encouraged by a healthier outlook for the economy which will benefit new consumer products such as the video disc system," he said.

Dr. Donahue said the RCA-developed Capacitance Electronic Disc (CED) system has been firmly established as the preferred consumer video disc system, citing a recent national study which shows that "CED" products had achieved an 89 percent share of all video disc players bought by the public. "CED" players begin at an optional retail price below $300.

RCA's signing of the popular Mr. Kelly marks the beginning of a new national advertising and promotion campaign that emphasizes "a broad selection of family entertainment on video disc," said James K. DeVoe, Vice President, Consumer Communications, RCA Sales Corporation. "Our advertising has been designed to show how Mr. Kelly uses RCA VideoDisc as an important new entertainment medium."

"The stronger pace of video disc player sales in the first quarter and an increasing level of retailer support for the product are both encouraging signs for the development of this new industry," Dr. Donahue said.

Noting that RCA is presently the primary marketing force behind the product category, he predicted that favorable dealer experiences in both hardware and software "will lead to other brands taking a more active role in developing this new industry. That was the case in color TV, and more recently, VCR."

In reviewing the progress of video disc player sales, Dr. Donahue pointed to new information from market research studies that indicate the product is being bought by consumers who are also significant VCR and cable TV users.

A recent study indicates that 23 percent of video disc player owners also have a VCR at home. That figure compares with a national VCR penetration level of only 6 percent for all color TV homes.

In a related area, the same study determined that 38 percent of the video disc player owners also subscribe to cable television, a higher level than the national cable usage figure of approximately 30 percent.

Dr. Donahue said the research findings suggest that a much broader economic segment of the consumer market is inclined to purchase a variety of video products that have in common the expansion of video entertainment in the home. "Rather than either/or, more consumers are saying: I want both."

He stressed that this wider market for multiple video products "is a source of new and continued growth for the video industry." Industry sales to date of the major video product categories are running well ahead of all forecasts, he noted, with industry sales to dealers of color TV receivers up 15 percent over 1982's record sales year while VCR sales are running 88 percent ahead of last year.

The specific theme of the new RCA VideoDisc advertising campaign is "Gene Kelly Presents the 'Entertainer of the Year'.... RCA VideoDisc."

Six different print ads will be used to highlight specific occasions when Mr. Kelly uses a video disc player at home, Mr. DeVoe noted. Headlines in the ads include: "How Does Gene Kelly Always Have the Best Seat in the House?" and "How Does Gene Kelly Entertain Kids When He's Doing Something Else?"

RCA will also use radio advertising and Mr. Kelly's familiar voice to launch the new campaign in mid-April, Mr. DeVoe said. A series of 30 to 60-second network spots will be aired up to 125 times a week through June 30.

Mr. Kelly will also visit VideoDisc dealers' stores in the person of a comprehensive point-of-sale kit that includes a life-size cut-out of the entertainer holding a selection of video discs. Wall posters, window banner and easel card are also included in the kit. An outdoor billboard poster highlights the theme of the campaign.