Movie theatres turn spotlight to marketing

While a recession compels retailers in most categories to scale back on ad budgets, movie theatre chains have the opportunity to pack their premises, since folks are likely to crave escapism through film. And although North American cinema brands haven't been spared from hard financial times - in fact, the curtain has almost closed on many - they have begun to turn their marketing strategies up a notch.

While a recession compels retailers in most categories to scale back on ad budgets, movie theatre chains have the opportunity to pack their premises, since folks are likely to crave escapism through film. And although North American cinema brands haven’t been spared from hard financial times – in fact, the curtain has almost closed on many – they have begun to turn their marketing strategies up a notch.

Most cinema brands publicize the grand opening of theatres, but lately they’ve gone beyond that. For example, Toronto-based Famous Players, which has 110 locations across the country, launched a transit campaign in Toronto this month. The creative, produced by Encore Encore Strategic Marketing, aims to drive consumers to the company Web site, which now enables people to sign up for weekly e-mailings of show times. One ad shows a couple as they view what appears to be a horror flick. The scene is set up like an online page, with icons and the tagline, ‘Links, Camera, Action.’

‘The message is that it’s simple to go onto FamousPlayers.com and get information,’ says Stuart Pollock, VP marketing, who adds that a new transit campaign promoting gift certificates for the holiday season will soon replace the ads. ‘They are targeted at the young at heart – those who are interested in pop culture and have movies on the mind.’

Famous Players is also testing flat-prices in Winnipeg this fall, where all tickets are now sold for $7.95, without the usual discrepancies between age or matinee and evening shows. The new pricing strategy is advertised on radio, and so far, results have been favourable, according to Pollock, who says the format will be rolled out across the country if it continues to prove profitable.

Even though cheaper prices are an added bonus for people looking for something to do during economic instability, Pollock won’t say whether the issue was a driving factor for the initiative. Nonetheless, Famous Players isn’t the only movie theatre chain testing promotional pricing in today’s economic slump. AMC Theatres, which is headquartered in Kansas City, Mo., and has seven locations in Canada, including the yet-to-be-built Metropolis in Toronto, unveiled its new MovieWatcher Premium Card this summer in two cities: Omaha, Neb., and Oklahoma City, Okla. For one monthly price – US$17.50 in the Omaha test – participants can catch a flick once a day if they so desire. The effort is heavily advertised onscreen during previews, and moviegoers can sign up for participation in theatre lobbies.

Although the firm won’t decide whether it will expand the program until the end of March, Richard J. King, SVP of corporate communications, reports the numbers look promising. ‘So far it’s been very popular… but it all depends on the analysis and results.’

The trend toward more aggressive marketing practices doesn’t come as a surprise to Howard Lichtman, president of marketing consultancy The Lightning Group and a former EVP of marketing & communications for Cineplex Odeon. Box office sales have increased over the last several years, he points out, but that doesn’t resolve the financial dilemma most cinema companies face, because it fails to offset the huge costs associated with current multiplexes. According to research from the Toronto-based Lightning Group, which provides strategic advice to clients targeting the U.S. movie theatre industry, box office sales totaled $7.67 billion in North America in 2000, marking the ninth year they were on the upswing.

The sobering news is that 12 exhibition companies in North America have filed for Chapter 11 in recent years, but Lichtman believes that once they complete their ‘extreme reduction programs,’ they’ll emerge much healthier. Nonetheless, they still need to boost audience numbers through advertising. ‘Theatres have dramatically improved the experience with state-of-the-art [facilities], state-of-the-art sound systems, plush seating,’ says Lichtman. ‘The attendance has increased dramatically, but it isn’t sufficient to pay back the huge expense.’

Thus, after boarding up struggling venues in order to focus on their most profitable theatres, several cinema chains have plotted out new marketing strategies to draw crowds. Says Lichtman: ‘Even though things are going in the right direction, it makes sense to invest in advertising, because they still need to attract more traffic.’

Lichtman points out that it’s also crucial for cinemas to continue their efforts during a recession, since there is the prospect of luring more moviegoers than usual. In fact, movie houses have traditionally done well in recessionary times because the price of a film is substantially cheaper than other entertainment options, such as live theatre or sporting events. ‘People still need to be social and interact with others,’ he says. ‘They still need to treat themselves, and movies provide an escape. In fact, even in post-Sept. 11, movie box offices have been up, and that’s because people want to go out.’

Loews Cinema Entertainment, which filed for bankruptcy protection last February, has diverted from the usual cinema marketing script with a mini-movie of its own highlighting the virtues of the Cineplex Odeon experience. The spot starts out with the credits, ‘Mundane Pictures presents … A really boring film,’ and then introduces the main character, Frank the Fly, who is tragically whacked by a giant red flyswatter. In Phantom of the Opera fashion, Frank croons to the audience, ‘Tell Laura I love her.’ The cheeky two-and-a-half minute commercial, created by Toronto agency Taxi Advertising & Design, ran for the first time in Cineplex theatres in May and June, and is back in two new venues this month – Queen’s Quay in Toronto and Square One in Mississauga, Ont.

For his part, Paul Bolté, Cineplex Odeon’s director of national sales, believes it makes sense to address moviegoers in the theatre these days. ‘A couple of weeks ago, the box office was strong and it indicated that people are going to the movies,’ he says. ‘They need to escape from what’s happening and the movie industry offers a great place to do that.’

But is it really worth the production cost when you are speaking to those who have already bought into the multiplex movie experience? According to Lichtman, it is, because the average Canadian only goes to the movies 3.2 times a year, compared to the American average of 5.2 times a year. ‘That means there is an opportunity to market in-house, in order to get people who are going, to go more often.’