The master of the modern multiplex
With 30 years in exhibition, Vue’s COO Steve Knibbs knows better than any the issues that cinemas face. Patrick von Sychowski tackled him on transformation
You have a career that effectively spans the modern British era of multiplexes, going back to your job at the first AMC multiplex in Milton Keynes. What are the phases and cycles that you make out looking back on your journey so far?
Phase 1: the founding multiplex model — imported straight from Kansas City! Sloped floors/central foyer and retail stand (known as concessions)/focus on lots of shows for choice/cleanliness and service were paramount/central projection booths/first computerised ticket systems/Dolby Sound in all screens as standard/all run by high-quality, enthusiastic management and staff/focus on training programmes to ensure consistency of delivery and high standards/changing people’s expectations of what to expect from a cinema, definitely not ‘flea-pit’.
Initial sites were all out of town in the new generation of shopping malls being built or on retail parks or large standalone units. The first companies were AMC in 1985 and National Amusements in 1987 (Showcase Cinema’s brand), followed by CIC (Paramount and Universal) of the UK-based operators.
Phase 2: Increasing the food offers — Coffee started to be introduced together with Pick’n’Mix and the first scoop ice cream offers.
Phase 3: Stadium seating and the ‘rush for share’— started to be introduced in the early to mid-90’s and straight away became the new industry standard – improved sight lines and larger floor-to-ceiling screens. During this phase the UK and some European territories saw the ‘rush for share’ with numerous companies entering doing lots of deals and raising the cost of cinema development quite dramatically — Village Roadshow, Hoyts, Cinemark, Ster Century — all these companies sold up and left eventually. Generally, many of the sites built were too large with high rent levels and in too many competitive markets, therefore not providing sufficient returns for investors
Phase 4: The megaplex era — in the mid to late 90s. Kinepolis had already done this successfully in Belgium and, later, Spain and France. US companies, led by AMC started to build up to 30 screen megaplexes. This trend has not been sustained — too large, too expensive, too much competition impacting admission levels. These were huge financial gambles that did not really pay off, with a few notable exceptions finding success where competition has not eroded admission levels.
Phase 5: the move into town and city centres in the UK driven by changes in Government Planning Regulations. Companies such as Everyman and Picturehouse started to form and drive new locations refuribished successfully in older city centre sites.
Phase 6: the digital revolution, helped by 3D — better quality images, greater flexibility, growth of smaller operators in smaller markets, government support in some territories.
Phase 7: regional consolidation — in-country acquisition had always happened, but since the mid 2000s there was an increase in regional mergers and acquisitions on a larger scale, leading to Vue, Odeon and Cineworld’s growth in multiple territories — but also for operators such as Pathé, Kinepolis and UGC.
Phase 8: global consolidation — the final phase and where we are heading now. In the next three years, three or four major global cinema companies will have a presence on all continents with direct deals with the major studios.
Last year Vue re-opened its flagship West End multiplex to much fanfare. What do you see as the priorities in modernising and upgrading other Vue sites?
The basics will always apply — seats, sound, screen. You have to protect what people choose to come to the cinema for in the first place, the best seats, amazing sound and perfect pictures — better than they can ever have in their own home.
The look and feel of the cinema has also to be addressed as you want people to see and feel the cinema is a modern, up-to-date place to go and spend their time. Interior design should never be an afterthought.
How can cinemas become better at investing in their staff, helping to make them the customer-focused human face of the business?
This is a huge question and it goes to the heart of what we have always tried to do at Vue. We believe that employing the best general managers and supporting them with ongoing, meaningful and targeted training programmes will lead to them attracting better managers and better staff.
I have found over many years that if a cinema doesn’t have that welcoming feel about it when you walk in then often this is a reflection of the general manager and the personal standards he or she adopts. Some people are just more driven and empathetic about service and believe in it with a passion. Find those people and don’t compromise. You basically want people who want to have both the cleanest washroom facilities (standards) and are drawn to people (friendly service). That sounds easy, but it’s a 24/7 process constantly to be looking for this combination.
Many of our team are students and for a lot of them Vue is one of their first entries into the workplace. As you would expect, Vue has very clear standard operating procedures (SOPs) that cover all aspects of running a cinema.
We have the supporting training framework to help deliver these. Constantly checking, following up, and asking questions, and our operations teams regularly visiting cinemas all help ensure we keep up the high standards that we set ourselves in all our territories.
We keep hearing about the importance of Big Data — how is Vue turning all the data that it already has on its customers into smarter, targeted customer relations?
I can only give a generic answer as a lot of this area is highly commercially sensitive, but essentially Vue collects data via all its interactions with customers. We use that data to target messages carefully. Our promotions to customers encourage them to book tickets and visit us more often. What I can say is that the use of data is a daily and even hourly piece of work that never stops. You need highly proficient and skilled people to interpret that data and then match it to the appropriate response. The days of sending out mass non-targeted emails (spam, basically) are a long way behind us and we aim to develop messaging to customers that is as personally relevant as we can possibly make it. Every interaction helps improve our knowledge of a customer and makes communication more relevant.
With the merger of Disney and Fox looming in 2018, as well as Netflix and Amazon increasing production spend, what is the future relationship between cinemas and content owners?
There has been and always will be a changing landscape of who produces films and how they get to market. The traditional studio-distributor-exhibitor model is evolving and eventually with the continued rise of large regional and global exhibitors there is more likelihood of us seeing direct deals between studios/content providers and larger exhibitors. These will cover not just content but also marketing (in cinema and online), shared use of customer data and other promotional activity.
How can the industry get better at catering to female audiences — other than depending on particular film titles — as well as promoting female managers?
Our customer split reflects society — roughly 50/50 — so you could argue that we already cater for all sections of society. However, I recognise the intent behind the question and undoubtedly catering to more female-centric audiences requires an appreciation of what drives a cinema visit in the first place. Having a comfortable, welcoming design and atmosphere rather than a cold, harsh look and feel can only help. Overall service levels need to carry on improving. The rise of branded café offers and comfortable seating spaces in the cinema and the range of F&B on offer also plays a part.
With regard to promoting more female managers, Vue’s goal has always been to have in place robust policies that are free from any kind of discrimination other than merit and capability to do the job. This means that anyone in the organisation that has a desire to progress their career (including female managers), has equal access to training, personal development and new opportunities.
How do we define ‘innovation’ within the cinema business? Is it trying new things like VR and AR, or is it something more than that?
‘Innovation’ for me is how to stay one step ahead of customer expectations — your core cinema offer, your choice of what is shown on screen — films and all other content, your pricing, your communication with customers, it all needs constantly to change and adapt. Innovation should stretch across all areas of the business from how the cinema appears, to what it shows, at what price and how we communicate this. That means you should be challenging the current business all the time and having ideas set in the “test, learn and move on” mode constantly.
I’m not certain if VR or AR or anything else provides answers, what I do know is that they have to be market-tested and those elements that customers like and respond to and from which you can grow your business will gain traction and be rolled out on a wider stage.
Stand still and die was never more appropriate than in today’s faster-moving social environment.
Where would you like to see Vue and the cinema industry in five to ten years time?
That’s an easy one! Vue will be one of the top three companies in the cinema industry in the coming years.