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BRISBANE and LOS GATOS, Calif. -- Wal-Mart and Netflix yesterday entered a joint promotional agreement covering their core online movie businesses --Walmart.com's movie sales and Netflix's DVD movie rentals. In the agreement the two retailers -- each with strong, complementary expertise in online movie services -- will market one another's key movie business on their respective Web sites.
As movie sales at Walmart.com continue to accelerate, the company is strengthening its commitment to this core business, and as a result is discontinuing the Wal-Mart DVD rentals service. Walmart.com's existing DVD rentals customers will be offered the option to become Netflix subscribers at their current Wal-Mart rate for one year from the date they sign up. Via its Web site (www.walmart.com/movies), Walmart.com will also promote and refer customers interested in online DVD rentals to Netflix.
In return, Netflix will promote Wal-Mart's online movie sales business, including the preorder price guarantee option at Walmart.com, both at its Web site (www.netflix.com) and in mailers sent to Netflix subscribers. The preorder price guarantee ensures customers the lowest available price on preorder movies.
"We've experienced tremendous growth in our online movie sales, and are committed to enhancing our focus in this business at Walmart.com," said John Fleming, Wal-Mart's e.v.p. and c.m.o., who also oversees Walmart.com at the executive level. "We're equally excited to team with Netflix, the pioneer of online movie rentals, which not only distinguishes both of our core online competencies, but offers a complementary solution of value, service, and convenience to customers."
Added Netflix co-founder and c.e.o. Reed Hastings: "This agreement bolsters both Netflix's leadership in DVD movie rentals and Wal-Mart's strong movie sales business, while providing customers even more choices and convenience. Both companies will continue to expand their respective leads in providing the best in movie entertainment to millions of online customers."