Despite the numerous predictions of the decline of cinema, last year UK cinema attendance saw the highest levels for 50 years. Vue’s founder Timothy Richards caught up with The Drum to discuss why he feels this resurgence will continue as the chain enters 2019.
Yet, UK cinema hit a record high in 2018, with 177,001,481 cinema admissions, increasing 3.7% on 2017 figures, according to the UK Cinema Association.
Mirroring UK growth, cinema in the US emerged from the "biggest years ever." Box Office Mojo recorded attendance was up 7.4% with 1.3 billion tickets sold.
Unperturbed by the "cinema is dead" rhetoric of recent years, those in the industry, including Richards, have put the surge down to society’s unwavering need for escapism and the continued release of a more diverse range of blockbusters.
“It’s been a wake-up call for everyone outside the industry," he explained.
Ad spend in cinema is slowly increasing
However, some marketers have "woken up" to the power of cinema. Last month, the Advertising Association (AA) reported that spend on cinema in the third quarter of 2018 had risen by 2.3%.
Karen Stacey, chief executive of Digital Cinema Media (DCM) said the growth is in large part thanks to the challenges facing other advertising platforms. As faith in social networks like Facebook and Google is eroded by concerns over brand safety and transparency.
“The transparency debate and brand safety issues across the industry is, in fact, working in cinema’s favour,” Stacey said.
Richards, meanwhile, has put the increase down to a combination of “locked in” audiences who are attending a more diverse range of films. Though it will never compete with digital for targeting capabilities, he said that this increasing diversity of movies has provided advertisers with “more specific audiences to cut into”.
"Although there wasn't a big Avengers or Star Wars release, you had movies like Black Panther and Wonder Woman which catered to new audiences," he continued.
Not only can cinema's increasing diversity of offering give advertisers new routes to specific audiences, but the nature of the viewing experience also provides an advantage over digital channels, where just over a fifth of internet users have installed an ad blocker.
In a report commissioned by DCM last year, it found that 71% of respondents felt they were ‘hounded by advertising’ with 39% installing ad blockers. Despite this, the results also revealed that 16-35s do still feel a strong affinity with brands and like advertising when in the right context.
The “locked in” nature of cinema experiences offers all alternative avenue for brands wishing to engage an audience that’s often distracted, explains Richards, as “there is a captive audience who are very receptive as they’re in their seats and their listening.”
Will Netflix and cinema be BFFs?
Despite the rhetoric of how streaming services could destroy cinemas, Richards is adamant that the likes of Netflix and Amazon Prime Video are not a “threat” but a “completely different business model” which should be more of a concern for terrestrial TV than theater owners.
The DCM report also revealed that 16-34s still appreciate experiences and love entertainment content, but technology has fundamentally changed the way they access this at home and on the move. Further, it found they value escapism provided by the lack of distraction in cinema.
Richards agreed, saying “there is always going to be a demand for kids to get out of the house.” And they are increasingly getting out of the house to see a theatrical release of a Netflix of Amazon prodcution.
Last year Netflix changed its long-held release policy which had seen it resist granting theatrical release to its filmmakers which, therefore, had the potential to hurt filmmaker’s chances when it comes to award nominations.
Since then, three of its Original films – Alfonso Cuaron’s ‘Roma,’ the Coen Brothers ‘The Ballad of Buster Scruggs’ and Sandra Bullock’s ‘Bird Box’ – had exclusive theatrical runs.
“So it’s win-win, I think you will see a lot of that in the future,” surmised Richards. “Amazon is already there. [Jeff] Bezos has said publicly on several occasions he wants to release his movies in cinema, and then put them on his Amazon Prime subscription service.”