Exhibitors who embrace innovative data tools can address an age old challenge: getting customers through the door. Sarah Lewthwaite, SVP at Movio, illustrates how targeted use of data can impact the bottom line.
Words: Sarah Lewthwaite
Putting bums in seats has long been the mission of the exhibition industry. With occupancy continuing to hover at an average 15-20%, cinemas are constantly challenged to find ways to grow footfall. With the growth in online and mobile ticketing, loyalty and subscription schemes, and with deeply entrenched social media strategies, exhibitors have also never been so data rich.
This presents a wonderful opportunity for cinemas to look to their data sets and to new technologies which leverage this data, to help increase occupancy. Whether it be by scheduling the best showtimes or optimum ticket prices, targeting guests effectively with relevant marketing, or attracting new customers, database technologies now offer cinemas tools to influence occupancy levels positively.
The challenge for cinemas to increase occupancy rates has often been compared to the challenge facing the airline or hotel industries which also have perishable inventory. But one of the reasons the cinema industry is distinct from these is that demand for the product is more challenging to predict. Most people plan for flights and hotel stays weeks and months in advance. The majority of movie-goers are still making a decision to go to the cinema on the day of the show. Factors such as weather, film reviews, school holidays, sporting events, even transit strikes all influence a cinema’s attendance in any given week.
So how can cinema professionals better predict demand for films and predict attendance in a way that will help maximise occupancy? It all starts with leveraging customer data. Over the past few years, products such as Cinema Intelligence and Smart Pricer have emerged, which integrate into a cinema chain’s data sets with these use cases in mind. These products consolidate and aggregate historical film performance and transactional data with external data such as online search, social media sentiment analysis and weather patterns to inform their algorithms.
Reaching customers with relevancy
By understanding the demand for product, cinema chains can begin to use technology to reach audiences with greater relevancy. The exhibition industry generally lags behind other industries when it comes to use of data and technology to segment and target audiences. Think of retail, where shoppers get relevant email recommendations for products based on previous purchases, or even the travel industry, which sends personalised communications based on a customer’s online browsing. Cinemas, too, have the opportunity to leverage data to ensure the right customers know about the right movies at the right time. Data science tools such as Movio’s new Audience Insights propensity algorithm are helping to make this easier for chains. By understanding movie-goers’ previous behaviours, Movio’s proprietary similarity algorithm can help predict future interests. This algorithm can then programmatically predict the best film for each movie-goer, each week.
The results cinema chains are seeing from a tool such as this are impressive with one cinema confirming that 14% of people who were identified as likely movie-goers for “Black Panther”, ended up making up to 50% of the opening weekend admissions for the title. According to Steve Mathwig, loyalty program manager from Marcus Theatres in the US, “Propensity modelling takes the guesswork out of who is most likely to see a particular film. It has become a major part of our campaign development strategy”.
By better understanding moviegoers and what drives them to the movies, exhibitors are also able to segment their total audience accordingly and provide more relevant, communications to bring them to the cinema more often. Going back to the example of “Black Panther”, not every movie-goer is going to be interested in that film — marketing efforts should reflect this. Some movie-goers will be keen and all you might need to do from a marketing standpoint is tell avid fans that tickets are on sale. Others need a bit of an incentive, or may be more likely to see it later in the release once they’ve heard positive word-of-mouth. Another segment of the audience may be better suited to other films that have are counter-programmed to the blockbuster release. So it’s a waste of effort to market “BlackPanther” to them. Understanding your audience, their likelihood of seeing a film and crafting target marketing accordingly, is a strategy cinemas should use to improve customer relationships and occupancy.
Attracting new audiences
Data is an important factor in helping increase occupancy — but what about those who are not your movie-goers, or are lapsed customers? How can data technologies attract new audiences? One example of how cinemas are tackling this is via ‘on demand’ movie programming. Products such as “Our Screen” in the UK (see page 37) and the “Vikaao” platform offered by PVR Cinemas in India offer consumers the opportunity to influence the programming themselves. Vikaao has a goal to offer 2,500 titles to choose from by the end of this year. They are attracting new audiences — OurScreen has found that 40% of the audience at its events are first-time visitors to that particular cinema site. Occupancy rates also out-pace averages, with OurScreen quoting 63% occupancy, 3x times the norm for cinemas.
The future is now
The cinema industry is changing. The digital world has transformed our daily lives, and cinema is no different. The role data will play in improving understanding of audiences, enhancing film programming, operations and marketing strategies and in driving attendance, is critical. Innovative products and services that help cinemas address this
are becoming more sophisticated and more accessible. Exhibitors who are early to embrace these will benefit most.
The demand for certain films or content in one cinema may not necessarily be the same in another. Using data-driven tools like Cinema Intelligence, exhibitors are able to better predict a film’s demand and therefore its potential occupancy level. This insight will empower film programmers to optimise content by location and even by screen. This ensures the most in-demand films are scheduled for the correct-sized auditoria, with an appropriate number of sessions at the ideal time for the target audience.
A broader audience:
With more films released every week than ever before, audiences are faced with more cinema-going choices. In fact, in the US last year, 90% of box office revenue came from approximately 30% of the films released. Through the use of data, you have to predict potential audience and performance of the films to be released and be able to further differentiate their screens. Cinemas may in turn be able to screen varied content, potentially reducing the dependency on blockbusters to generate increased occupancy and box office revenues.
Cinema Intelligence’s CEO Claudiu Tanasescu, explained recently that one cinema they work with which has 17 screens, went from showing an average of 19 titles a week to a far more extensive 41 titles after implementing their dynamic scheduling software. “By offering consumers more choice, our cinema partners are seeing a significant impact on their attendance and their profitability” noted Tanasescu.