On Tuesday AnimeNation reported that the Target chain of discount stores would phase out most anime DVDs by October 16th, keeping only 'high profile, primarily self-contained movie releases.'  ICv2 has managed to confirm a cut-back with representatives from several anime companies, although a Geneon spokesperson noted that Target placed 'a decent' order for its Appleseed movie, and a representative from FUNimation, which distributes a number of high profile anime series with major mass market appeal such as Dragon Ball, Yu-Gi-Oh! and Full Metal Alchemist, told ICv2 that Target had not indicated to FUNimation that it was getting out of the anime business.

Even though Target has had a great 2005 so far and is opening 600 more stores, the discount chain's reduction of the number of anime SKUs it carries should have little impact on the over-all sales of anime in the U.S.  Target has never carried a large number of anime titles and only did well with high profile 'hits' in the first place.  One anime company insider told ICv2 that his company had stopped dealing with Target over a year ago because Target didn't seem to have a clue about how to promote and sell anime. 

With the number of DVD releases growing exponentially as more and more TV series and older movies are hitting the market at the same time as new releases from Hollywood, Japan and elsewhere, the battle for shelf space in chain retail outlets is really heating up (see 'Best Buy to Devote More Space to DVDs').  Best Buy is grabbing space formerly devoted to CDs to make room for DVDs.  A spokesman for Best Buy explained the situation to Video Business.  'We've had to subdivide TV (show DVDS) into different categories and we've got anime and all these different categories we have to stock,' he said.  'The space has got to come from somewhere.' 

So Best Buy devotes more space to anime and Target less; most anime companies are probably happy with that trade-off.  Though Best Buy and Target are both mass-market retailers, Best Buy is much more focused on media than Target, which carries nearly everything from clothing to housewares, appliances, cosmetics, candy, school supplies, lawn furniture and foot powder. It is hardly surprising that Target has decided to pare down its selection of anime DVDs, and it would not be surprising if it were imposing similar cuts on some other genres as well. 

Most anime releases are not, at least at present,  'mass market items.' As in most DVD categories the vast majority of the sales come from the top 10% of anime titles -- and the genre itself, although it has shown steady growth over the past decade, is not yet that big in the U.S.  In the first quarter of 2005 anime accounted for 1.5% of DVD units sold in stores tracked by Videoscan in the U.S.  While that doesn't sound like much, it's more than foreign films (1.3%), documentaries (1.1%), musicals/music videos (1.2%) and fitness (1.4%).  It's more than half of science fiction (2.8%) and as third as big as horror (4.2%).  It's also worth noting that the stores that report to Videoscan may miss considerable strength in anime sales outside of traditional sales channel.   But even 1.5% of the $18-20 billion that is liable to be spent on DVDs in 2005 in the U.S. is a big number -- though Target evidently has bigger fish to fry.