WEEKLY CineBUZZ REPORT - 13 March 2012

Highlights of this week's Report:
- 3D/Will It Make Another Comeback ?
- Biometrics - A MUST Technology for Cinemas!
- Media Players take Center Stage

3D is a great format if done right

- 3D/ On the Re-bound ?
Since the modern re-intro of 3D movies - which kicked off in August '03 with the release of  Spy Kids 3D:Game Over and up to last week's John Carter - there have been 109 3D releases (see chart).
Some of these films have been huge box office successes, others - real lemons..

• Modern 3D Releases
• 2003 - 1
• 2004 - 0
• 2005 - 0
• 2006 - 3
• 2007 - 3
• 2008 - 6
• 2009 - 14
• 2010 - 28
• 2011 - 47
• 2012 - 34 (7 to date)

There were 47 3D releases last year, but it had become apparent that the public was not enthralled with the experience nor the 3D admission upcharge.  This year, through last week, there have been seven 3D films and the release schedule indicates another 27 for the remainder of the year.  That's a decrease of 13 releases from last year - which is a significant decline.  For 2013 only 20 are scheduled for release, and for 2014 only two are earmarked thus far.
Due to declining attendance (lack of demand for the 3D format) many exhibitors have decreased their 3D admission upcharge, while some have eliminated it altogether!
Like all films, good product begets good attendance - 3D or 2D.  Hollywood learned that releasing mediocre films in 3D was not going to solicit attendance.  In fact, it had the effect of discouraging attendance for well made 3D movies.
It seems Hollywood mavens are often wrong, but never in doubt. I think now even they doubt how 3D was initially handled.  Hopefully, in the near future, we'll be viewing some killer 3D flix which will re-spark the format.

Cinema MUST Embrace Biometrics

One of the big issues I always harp on is the use and adoption of technology by cinemas to make them more profitable and efficient.  For some reason(s) cinemas, by and large, are not willing or do not see the need for the use of new technology in managing their business. 

Walk into most cinema lobbies and you are confronted with a large, brightly lit space, with a uninviting concession stand selling same old, poster cases on walls, perhaps some signage using hanging LCD monitors for food pricing or other (usually unimportant) information, and maybe some non-motivational advertising about joining their "club" or purchasing gift cards.
This is a decades old picture and there is something wrong with it.  The IT is the lack of any marketing or showmanship and the total lack of the use of modern technology to foster sales, efficiency, and profitability.

Reader for Cinemas less than $500

One thing, cinemas can embrace, be it small, is the use of  Biometrics.  Ah, you say, what the heck is Biometrics?  Well, Biometrics is the science and technology of measuring and analyzing biological data, such as: DNA, fingerprints, eye and voice characteristics, etc. for authentication.  So, how does this have its use in cinemas.  Simple. It the most inexpensive way to verify payroll.

Biometric Time & Attendance Readers are self-contained, stand-alone devices that use fingerprint and/or security cards to track when an employee clocks in and out.  Better still the Readers will generate payroll reports which can be transmitted to PC, Flash drive, or other storage device.  The Readers can hold bio-data on up to 3,000 employees and they cost under $500!  Are you kidding me.  The technology pays for itself in one payroll cycle. And it generates the payroll report for you. No more payroll calculating, no more payroll service fee, and no more time-fudging by employees.  

Biometric Readers are the perfect example of a technology that can be used to best advantage by cinemas. If you want more information on Biometric Readers email me. My address is under my mug (great pic, I was happy that day)  to the right of this post.

Media Players - Promotion/Sales/Profits

Speaking of technology, the latest digital signage solutions that integrate audio, video, and data for an enhanced customer experience have just hit the market.  For a single to hundreds of screens these new systems are low cost and effective with no recurring license fees and lifetime software upgrades.

Small yet powerful

Spinetix, a Swiss company makes the best commercial media players that have unlimited adaptability - and can even be networked to serve multiple locations.

How MPs work

Yet another technology that should be embraced by cinemas - for in-theatre promotions, 3rd party fee-based advertising, information & data for concession sales and promotions, cinema events, local news, etc. The new media players make it exceptionally easy to create and change content with unlimited possibilities.  They are very affordable and they work at generating sales and profits.

Best and Happy Movie Going!
Jim Lavorato

WEEKLY CineBUZZ REPORT - 1 March 2012

Highlights of this week's CineBuzz Report:

- Gamification -- A Way to Build Moviegoers' Participation & Loyalty!
- Three Proven Tactics For a Cinema's Success
- On-line Concession Sales - Profitable & Efficient
Gamification

Gamification = Loyalty

Cinemas need to adopt gamification - internet-speak for a new  marketing tool which uses fun and games to build customer loyalty.
Now, there is nothing new about customer rewards and loyalty programs.  Termed "earn and burn", these programs have existed for years, and  many cinemas, like other companies (airlines and hotels quickly come to mind) have built loyalty programs around points, discounts, miles, etc. But many of these programs fall short of their mission - to retain and grow a loyal customer base.
What gamification does is to take game elements to connect with and engage customers. Using techniques, known as funware, and the power of social networking, gamification techniques challenge and motivate customers through competition, recognition, and rewards.  Gamification motivates people with virtual awards that have little or no monetary value, but that deepen the engagement and exposure to the cinema (and its brand) through something that has intangible value. Sounds crazy- but it works!
Some examples of gamification that could be used by cinemas:
- Online trivia games - which rewards winners with special concession coupons and deals.
- Reviewing movies - where reviewer "levels" are achieved dependent on the number of reviews published on the cinema's site. For example, a "Star Level" is given when 8 reviews are posted - and a "Star" would be displayed on the cinema's site along with the reviewer's profile.
Traditional loyalty programs are not social - gamification adds that social dimension which is very powerful to brand loyalty.  It turns loyalty programs into enjoyable, social on-line experiences that are very simple to implement and at very little or no cost.  For example, a cinema could present badges to people that purchased their admission ticket on-line for a particular film.  These "virtual" badges would include the benefit of sharing favorite insider tips on up-coming films, and having discussion with the cinema's staff on future films, concession, and cinema events.
Gamification is designed to provide a constant stream of motivation to keep moviegoers engaged.  In the future, loyalty programs will incorporate more fun and games rather than expand the "earn and burn" format of today.

New & Inexpensive Ultra-thin Cinema Displays

Three Success Tactics in the New Cinema World
The game of cinema exhibition has permanently changed - just as it has for most off-line businesses.  New survival tactics are required to prosper in this new environment - here are three:
First, lower your prices.  I know this is painful but it's the only way to get moviegoers back into the cinema and it will force you to re-focus on productivity, marketing, and the use of technology.  You may have to live with lower per cap profit but you will make it up in higher volume if you do things right.
Second, embrace the store-within-a-store strategy.  Focus on a few key product lines which are easy to inventory and train staff on. These product lines may consist of select clothing, peripheral electronics, or even new concession items.
Third, exhibitors have to create an experience that is proprietary and unique. A transformative re-scripting of normal operations where moviegoer participation is requisite.  Cinemas can build brand loyalty by letting patrons participate in creating the "movie experience."  Termed: consumer mindshare, this trend in marketing and brand development, is a perfect fit for cinemas.
Thinking beyond convention is hard but will be very rewarding for the cinemas that adopt these tactics.  You need to go beyond "having good customer service" with your old products and selling techniques - the cinemas of tomorrow need to focus on innovation and extension to deliver an experience that is more than just going to the movies.

Empire Debuts On-line Concessions

Concession Sales Go Digital

For several years I have pushed hard for cinemas to have on-line concession sales.  The idea never left its cage however, as the cinema industry didn't get "it" - until now!  Last week, Empire Cinemas, the largest independently owned cinema chain in the United Kingdom with 158 screens announced its introduction of an on-line concession sales initiative. 

Empire's moviegoers will now have the opportunity to purchase concessions at the same time as they purchase their tickets. The new system is being trialed at two locations with the intent of being rolled out circuit-wide if the service proves popular - and it will.

Empire's system allows customers - after purchasing their tickets - to visit an on-line concession stand where they will make their selections. Once selected and checked out they will receive a voucher that allows them to pick-up their concession items along with their tickets.  On-line concession sales not only saves customer and staff time but users will be given special discounted combo deals - making a trip to the on-line store cost effective.

Gordon MacDonald, Empire's Retail Manager, stated, "We're always looking for ways to make our cinema offering the best available and give our customers the ultimate cinema experience.  It's only natural that Empire use this platform to offer our confectionery and refreshments to customers who prefer to buy online."

Not only more convenient, but I predict on-line purchases will boost a typical sale by 15-25% vs. an in-cinema purchase!  Any cinema that is not offering on-line concession sales is experiencing an opportunity loss - get to it!

Epilogue

The three topics of this week's CineBUZZ Report represent several ways to engage and encourage your cinema's customers, and hit upon three of the five cinema essentials (Value, Convenience, Quality, Participation, and Experience)

Best and Happy Movie Going!
Jim Lavorato

TIME TO REHAB YOUR CINEMA'S MENU



Sunshine Cinema, NYC offers Vegan Goodies

Exhibitors - want to increase patronage and profits - maybe it's time to rehab your concession menu.

Nothing could ever best popcorn in terms of profitability but maybe enhancing your cinema's menu could add to concession sales while making the movie experience a little different and fill some of those chronically empty seats.  Several cinema's have done just that!  Let's see what they to.

At one end of the spectrum is the Alamo Draft Houses*, the Austin, TX based mini cinema/restaurant chain which offers a movie with a casual dining experience.  Featuring Tex/Mex inspired food and, as their name implies, brews, Alamo's concept has been very successful. Than there is the Fleur Cinema & Cafe in Des Moines, which specializes in baked in the cinema goodies - from Rice Krispie treats to gourmet cupcakes.  Or how about a freshly made stuffed pretzel (beef or cheese) at the reRun Gastropub Theatre in Brooklyn, which also serves up seasoned popcorn (garlic, paprika, or herb salted). Popcorn toppings include fresh drawn, brown, or herb butter, but for a real kick, try the bacon or duck fat.

These food innovations are but several examples of what cinemas need to think about when re-scripting (as I term it) there operations. You need to build your concessions around your demographic, be it vegan cookies or duck fat popcorn topping. Rehabbing and revitalizing the concessions menu is relatively easy and really contributes to the movie going experience.

*In the interest of full disclosure it should be noted that management from the Alamo Draft House attended several of our Cinema Training Central seminars and workshops within the last two years.

 On Beverages in Cinemas

Go to the movies and, with few exceptions, your beverage options are going to be the usual lineup from either Coke or Pepsi and maybe a smoothie or coffee.  Hmmm......but is that what you really want to be selling?  Think about it. The largest demographic for movie attendance is the 16-35 male. And what is this demo drinking?  More and more it's the high priced energy drinks from Monster Beverage, RedBull, Rockstar, and Amp.  Monster, the biggest seller had over $1.3 billion in sales last year, a record. In fact, the entire energy drink industry's sales have been skyrocketing.

Energy drink sales are on a tear

And guess what, their entire market is virtually made up of teens and people in their early 20s, as only 16% of adults over the age 18 have ever consumed an energy drink.

Monster knows its audience

 

Monster's best seller is Monster Energy which comes in 16oz. and larger cans. They also sell the Rehab which includes the superconcentrated M3 drink and the 17 ounce Ubermonster brew.  Just intro'd -  Java Monster, a coffe drink and Hansen's sparkling water line of beverages.  Its original lines include Hansen's natural soda and Peace Teas iced teas.

Both Pepsi and Coke has been playing catch-up against the much smaller energy boosting rivals.  Although Pepsi acquired energy brands SoBe Adrenaline Rush and SoBe No Fear it hasn't been able to get sales off the dime.  Coke has faired no better with its Full Throttle drink, in fact, the minute Coke put its name on the can sales went down!  Coke and Pepsi just don't cut it in the young male adults' world.

Now, I'm not saying every cinema start selling energy drinks but it may be a wise item to add to your concession menu particularly if your patrons include a large number of teens and 20 somethings. If  nothing else, selling energy drinks would demonstrate your cinema is trendy and with-it, and you may be able to strike a "sweet"  deal as expansion into cinemas, for these beverage makers, is a great market fit.

Best and Happy Movie Going!
Jim Lavorato