With the big-budget and multi-starrer movies like SRK-starrer â€˜Don 2 â€“ The Chase Continuesâ€™, and Anees Bazmee-directed multi-starrer, Thank You, scheduled for release in 2011, the year looks promising for the medium and cinema advertisers. The ad revenue on the medium is all set to grow by over 10 per cent during the year 2011. According to the Pitch Madison Media Advertising Outlook 2011, the medium will continue to hold its share of 0.5 per cent in the ad pie, with a revenue of Rs 130 crore, up from Rs 118 crore in 2010.
Film trade analyst Komal Nahata says that the next 12 months look good for film industry and the big launches will hopefully keep the cash registers ringing. â€œThe year has already started with good results in January for big releases like â€˜No One Killed Jessicaâ€™, â€˜Yamla Pagla Deewanaâ€™, and Madhur Bhandarkarâ€™s â€˜Dil Toh Baccha Hai Jeeâ€™. Other big-starrer movies lined up for release in next 11 months will only add to the momentum,â€ says Nahata.
Multiplex owners are optimistic that cinema will attract advertising from mega events like ICC World Cup and IPL too. â€œMega events like World Cup and IPL, and new launches in automobiles and handset market will drive up ad revenues in the next 12 months,â€ says Arun Tyagi, Group Head â€“ Media & Business Head – Big Cinemas. He adds that Big Cinemas will also be taking other initiatives like BIG Cinemaâ€™s Fan Choice Awards, and doing activities around Valentineâ€™s Day and Womenâ€™s Day.
Also, with the increasing reach of multiplexes, the flexibility of the medium will attract more advertisers. Sunil Punjabi, CEO, Cinemax India, feels that the medium will evolve further with innovation as its key driver. â€œInnovation is the key to drive ad revenues in the coming year. With increasing innovations on one-on-one marketing with cinema goers, the advertiser today has an option to establish multiple layers of communication with them.â€
PVR CineMedia too is focusing on increasing ROI for the advertisers through innovation. Gautam Dutta, CEO, PVR CineMedia, says â€œOur constant endeavour at PVR is to devise innovative solutions to our clients so that they can maximise their returns on the investments that they make in cinema as a media. We are also looking towards providing a guaranteed ROI module to our customers,â€ he says.
Elaborating on the scope of innovation in the medium, Tyagi of Big Cinemas, says, â€œThe innovations can be experiential where an entire auditorium/screen and lounge could be branded as per the clientsâ€™ needs and requirements. Another way is sales-led innovation where we could allow sales activations at our multiplexes, where the advertisers can sell their products by setting up a kiosk at our properties.â€
Besides these, innovations can also be done through various off screen platforms like floor stickers (3D imaging), walls, pillars, lifts, staircase, glass facades, and washrooms to name a few. â€œCinema screens can also be an alternative option for awards functions, company conferences, team building exercises and workshops,â€ says Tyagi.
While cinema advertising lately is being driven by telecom, media and finance; real estate, education, FMCG retail and even home dÃ©cor too are expected to chip in 2011. With 3G and MNP (mobile number portability) introduced almost simultaneously, telecom players are likely to use the medium even more. According to Anand, â€œTelecom players are doing activations in and around multiplexes and backing the initiatives with on-screen messages.â€
Sunil Punjabi of Cinemax India feels that â€œWith multiplexes reaching to audiences with differentiator price points, the advertiser has the capability to reach select audiences. White goods, semi-white goods and FMCG are two big categories which could be the large advertisers in the next 1-2 years.â€
Cannibalisation a hindrance
While there are opportunities, there are challenges too. The first and the foremost,Â according to Tyagi, is the cannibalisation from diverse alternative platforms. â€œThe growing importance of alternate distribution platforms like DTH, Satellite Television and 3G enabled handsets are a threat to the profitability of theatres,â€ he says.
Another key challenge that multiplex owners are facing is the decline in footfalls and occupancy levels, and poor content is clearly to be blamed for it. â€œMaximising the number of footfalls in our multiplexes is a big challenge. I think this largely depends on the kind of movies that tinsel town produces. While we need more of Aamir Khan, SRK, Salmaan Khan and Akshay Kumar on the big screen, the quality of the content too has to go to the next level to pull audiences to theatres,â€ says Anand.
Above all, is the challenge of convincing clients and agencies to take the medium seriously. â€œThe challenge lies in the fact that cinema as a medium lags behind in terms of backing from agencies as well as clients,â€ says Tyagi.
The license raj
Moving ahead media owners feel that the expansion of multiplexes into the Tier-II and Tier-III cities will give a boost to the medium as marketers would like to reach to consumers through the medium in these emerging markets. However, the growth is being hindered by the number of licenses required to operate a multiplex. â€œOn an average, a multiplex requires at least 40 licenses to start operations and the period of acquiring licenses takes anywhere up to three months. A single window clearance mechanism would be a major boost for the industry,â€ says Tyagi.
A good Outlook
In spite of the challenges, cinema owners are buoyant about the growth, and the positive market sentiments. Vishal Anand, Senior Vice-President, Sales, Fun Cinema goes precise with his predictions for 2011 as he says, â€œI feel, in next three years, the advertising on big screen and off-screen in multiplexes would grow by 40 per cent.â€
But Sunil Punjabi of Cinemax is more realistic in his projections as his chain targets a 35 per cent growth in the advertising revenue. â€œThe overall biz of Cinemax is growing at around 25 per cent. Cinema advertising will have a significant contribution for the same. We have targeted 35 [per cent growth in the coming year on advertising,â€ says Punjabi.
Big Cinema is also very optimistic on the growth of its advertising revenue in 2011. â€œI expect this fiscal year to close at a range of 50-55 per cent growth over the previous fiscal. But we will continue with our efforts to strive for more growth year-on-year.â€ says Tyagi.