Off the record and very hush-hush.
A room with a pre-view
So, if you've been to an adult store anytime in the past 30 years or so, you're probably familiar with the "preview rooms". The idea behind these was to give people a place to preview movies before deciding to buy them, but rarely, if ever was that the way it was used. Instead, they were used for a multitude of other reasons. They were used by people who couldn't risk being caught at home with porno. They were used by people to hook up for sexual activity. They were used by people to just watch a buncha porn with no paper trail and in the privacy of their little darkened room. I'd say the percentage of people who previewed a movie and then chose to buy it was maybe 5%, and I say 5% because 1% just seems too low.
During the formative years of the modern day porn store, these preview rooms should have been classified as subsections of the Department of Treasury because these store owners were practically printing money in them. Very little overhead cost was involved, only routine cleaning and occasional mechanical maintenance. A movie could generate 10 to 20 times it's cost, all while never physically leaving the store or shelf for more than an hour.
Back then, porn stores were pretty much the only place to get porn. They had a monopoly on the delivery method, so they could dictate prices and options, and the average consumer had no leverage. But a strange thing happened around 1986. That is when the movie Top Gun came out on VHS at a priced-to-own price. Naysayers were quoted at the time as saying that "no one wants to own a bunch of movies in their house". Top Gun went on to do giant numbers and the home video market exploded.
All of a sudden, Hollywood realized that people liked to collect movies, and the catalog pricing soon followed. The problem is that the porn market was actually YEARS BEHIND Hollywood in this endeavor. So much for the "porn leading the way", guess that's not always the case. Studios maintained their higher prices and porn stores followed. When studios realized they had warehouses full of static product, they finally adopted the catalog price and the porn retailer was able to buy older movies for a lower price. But did they pass that price savings on to the consumer?
No. They instead pocketed the savings and kept adult titles at ridiculously high prices. Because they still had their cash-cow preview rooms, they stood to make more revenue off a title by NOT selling it. This still happens today. While the market has dictated a $20-$30 price for new titles, there are still 100s and 100s of store retailing new titles for $60 and up. They still believe in turning that title through their preview rooms as the predominate way to bring in revenue. All the while places like Blockbuster and Wal Mart have realized that they can move more volume and bring in more revenue by pricing titles affordably. Big Blue and Wally World don't look to make an obscene profit on an individual transaction for There Will Be Blood, they like to make profit on the title, plus have you buy a catalog title with a higher profit margin. And while the profit margin on 1 piece of No Country For Old Men might be less than say Spaceballs, they'll sell a lot more copies of No Country, and thus make more revenue.
Adult stores are still stuck in the mentality of overpricing titles so that the consumer is discouraged from wanting to collect it. Which has alienated them from their most loyal of customers, who are well read enough to know they can go online and get the titles they want for 50% the price. Until stores realize how to price titles so that they can be collected, they'll always lag behind the internet, and as more and more consumers turn to the internet we run the risk of them becoming free downloaders and not paying customers.
The adult industry has done nothing to encourage their stores to price movies accordingly, we just sell the titles to the stores without actually caring if they are trying to move the title. If they never move the title, then there's no need to reorder the title, and both the retailer and the studio wind up with a lot of static product sitting on the shelves.
Stores have to move past the "preview room" pricing and adopt a "priced-to-sell" mentality. These days, stores don't have the monopoly on the delivery method for porn. There's the internet looming over your shoulder devouring the customers you leave unsatisfied. The type of consumer that went into viewing rooms years ago, is now the same guy that just watches free clips on tube sites. He doesn't need the preview booth anymore, because the internet provides him with the visual stimuli he seeks, and there's no physical product to incriminate him with his spouse, girlfriend, family, what have you. Viewing Rooms work as a repellent to any possible female customers, as they will not patron your stores because of the dirty stigma attached. The local community will tire of hearing about sexual rendezvous happening there, and they'll act to get you expelled from their area. You'll leave yourself wide open for tax evasion investigations. So ditch the booths, price accordingly, give your customers great prices, great options and great selection. Mainstream video stores figured this out about 15 years ago...how about adult gets with it?