In-Theater Marketing - What They're Not Teaching: Brand Loyalty
by Alex Billington
April 25, 2007
I came across an interesting article from the Movie Marketing Madness blog that covers the industry's marketing tactics with fine detail. They were mentioning an invitation they had received for AdAge, a big marketing magazine, about in-theater marketing sessions being held in New York and Los Angeles. Writer Chris Thilk mentions a few points that should be taught at these sessions, but will most likely not be taught. And he nails one of them right on the head with exactly what we've been preaching since the start here at First Showing.
Of all the major corporations in this world, the movie theater industry is one of the most brutal and relentless. They're entirely and endlessly about making money, at whatever cost and damage to consumers, and somehow it works (even with bad consumer experiences). I'm not going to argue their entire system, but Chris makes a fantastic point about in-theater marketing:
Theaters do almost no marketing of themselves and yet they're shocked they're becoming irrelevant. Note to theater owners: There's very little brand loyalty your multiplexes enjoy. People are there because you're the closest/cheapest house playing the film they want to see. Either make yourselves into a more pleasant experience or prepare to file for bankruptcy.
FINALLY someone realizes! But unfortunately it's just another smart individual like myself and not an actual executive working for a movie theater company.
We've been applying that idea of brand loyalty to a local Cinemark here, although if you're not in Colorado you don't feel the effects. It's the reason why I keep coming back to it (and have been since it opened nearly 10 years ago). And fortunately the general manager is smart enough to realize the same - brand loyalty is important to him. If we can help build that experience and they can get people to continue to return because they love the experience they get, then that's worth more than its weight in gold.
Just think about it yourself. Maybe you don't even consciously think about why you go to a certain theater. Most people will say it's the closest or cheapest, which is the general reasoning, but there are plenty other locations you could choose. And if you really wanted to, you'd go to the theater with stadium seating that was comfortable and had a good reputation in your mind with great projection and audio. Wouldn't you?
What's interesting is that almost every other industry in the US focuses very highly on public relations, consumer feedback, and brand loyalty. Why are Coca Cola and Microsoft the most powerful brands in the world? Because for a while (disregarding Windows Vista) they've maintained such a reputable brand name that the loyalty they've earned with millions of customers has strengthened their business. Why the movie theaters and that industry doesn't get this (and even the studios in Hollywood), I don't know. Why they don't start implementing tactics and in-theater marketing methods to improve the experience and strengthen brand loyalty, I don't know. Maybe they're just too stubborn to look towards the future.
I've shouted this out to the ethernet many times before: MOVIE THEATERS ARE DOOMED!!. The market conditions are forcing theaters into a no win situation. Movie tickets are rising to ridiculous levels while the cost of home theaters are bottoming out. Plus, as you point out, most cinema owners/managers are just not smart enough to generate a ROI. Brand loyalty is not a new concept. Owners/Managers need to break the mold and look towards other industry for getting more customer volume rather than revenue per customer. Personally, I am done with paying $9.50 for a movie. I can usually find the DVD for close to that price and actually save money on popcorn and $4 soda.
grendel on Apr 25, 2007
Very interesting read!
Flutie on Apr 25, 2007
I completely agree with this. If a local theater would charge only slightly-inflated prices for food and drinks, not show commercials or too many previews, and generally put customers first, I would be a loyal customer. Even with a nice home theater system, I enjoy going out to movies on occasion. But the number one reason I don't go more often is that I don't like the theaters, and I feel like they're trying to take advantage of me rather than make me a satisfied customer. On the other hand, it seems that so many independently owned, single screen theaters which do try to be different end up struggling and going under. I think there just aren't enough customers who really question the system and who are willing to seek out something better when it is available.
Bruce on Apr 27, 2007
While I think you hit on an interesting point here, my comment is directed towards the comment left by Bruce. For years I have been hearing that the ticket price, while to me they are astronomical is not where the theatres make money, and I live in Canada where we pay $12.50 to see a movie right now, which is down from a previous high a couple years ago but will probably start to go up again given that our dollar is falling. While I do not know how much a theatre is charged to show a movie, I would guess that there is an initial fee and a percentage of all ticket sales for that movie that must be paid out. When you consider that they may be making very little on every ticket sold, I think the commercials, previews and the inflated concession prices make sense. It costs a lot of money to run a theatre, especially a large one e.g. in Canada the Silvercity Ciniplex theatres. Each theatre probably hires 40-50 employees, and this doesn't include head office workers. Even at minimum wage and assuming an average of 25 hours per week the theatre would be spending at least half a million dollars on employees, per theatre. This wouldn't include benefits, taxes, uniforms, internal promotions to keep up employee moral, manager's salaries, etc, which probably would account for at least another quarter of a million if not more. Once you factor in operating costs and the fact that businesses need to make a high enough profit for it to be reasonable for them to stay in business, I think it is clear why there are commercials, previews and high concession costs.
Vi on Nov 12, 2008
This is an interesting topic. There are new technologies that have yet to be explored by movie theater marketing groups. That is the wireless distribution of content to consumer’s mobile phones. Proximity Blue provides the expertise and technology to set up digital screens and posters that also send out movie trailers, images, audio, and much more directly to people at no cost to them. This is a true benefit for people as they wait in line or inside the theater for their movie to start. They will now be able to walk around and download whatever content interests them, while the theater and studios advertise their other products. For more info visit http://www.proximityblue.com
Alex Teplish on Nov 20, 2008
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