After the epidemic, has the non-ticket revenue of theaters recovered?
Editor’s note: This article is from the WeChat public account “DomoreDumou” (ID: DomoreDumou), author: Li Qingli, editor: Zhang Youfa.
“It is still recovering, but the speed is relatively slow.” When asked about the income outside the box office, a theater manager told Dumou (ID: DomreDumou).
The impact of the epidemic on non-ticket revenue of theaters is actually more serious than box office. The traditional non-ticket revenue of theaters mainly includes products sold (ie popcorn and drinks) and theater advertisements. In 2020, Wanda Films, Jinyi Cinemas and Hengdian Films will account for less than 20% of non-ticket revenue in 2020, which is also a significant decline compared to previous years.
The domestic film market is picking up. Lighthouse data shows that in the first quarter of this year, the mainland achieved a total box office of 16.409 billion yuan (excluding service fees) and 423 million movie viewers, which is close to 17.279 billion box office and 481 million movie viewers in the same period in 2019. Level.
In the Q1 report released by various film companies, Wanda Films has set a record since its listing with a profit level of 524 million, and Hengdian Films has a net profit of 171 million. Jinyi Films also achieved a net profit of approximately 16.79 million yuan.
Compared with the almost “no harvest” of 2020, theaters seem to have finally come alive. However, after visiting a number of theaters on the spot and interviewing a number of industry insiders, Poison Eye found that compared with the rebound of the market, the recovery of the theater’s sales and advertising business is obviously slower.
Improving the non-ticket revenue of theaters was originally a cliché. The epidemic has once again sounded the alarm for the film industry. Many people in the industry have expressed their views on increasing non-vote revenue and resisting risks to a greater extent.
Chen Sicheng delivered a speech in a forum last year: “my country’s film industry system really needs to expand and mature as soon as possible. If movies only rely on ticket sales, they will not be able to withstand risks, and one day they will starve to death.” This is also the case. He is committed to “Tang Tang Exploring the Universe”, linking movies, online dramas, and games to develop the reasons for derivatives.
Chen Sicheng’s “Tang Tang Exploring the Universe”
This is especially true for cinema chains. It is difficult to resist risks if you only rely on movie-watching income. In an era of the rise of new consumer brands, if cinemas cannot improve their diversified services and monetization capabilities, they will weaken their offline competitiveness.
Are the popcorn drinks selling well?
After the epidemic, Coke popcorn is no longer the standard for movie watching.
In order to understand the current recovery of the sales business, Dumo recently visited a number of theaters in Beijing. Observed on a one-hour basis, during non-prime hours during the day during the working day, less than 3 customers buy food on site on average. During the prime time after get off work on working days, business is slightly better, but within an hour, less than 6 or 7 people make purchases on average.
In addition, in remote locations, theaters with inconvenient transportation, the selling business will be even more bleak. In a theater in Tongzhou where the poison eye has been guarded, no one bought or sold products on the spot within 1 hour of non-prime time.
Cinema managers from Beijing, Changchun, Harbin, Shandong and other places also said that although the sales business has basically recovered, the recovery speed is relatively slow. In addition, this year’s schedule effect is too strong, and the off-schedule sales business is not as good as in previous years.
For the specific reasons that affected the recovery of the selling business, the cinema manager in Changchun told Dumou, “One is that the audience is relatively cautious, and the other is that the state has not officially released relevant documents, clearly saying that it can restore 100% attendance and open sales Product.”
During the severe period of the epidemic, the relevant departments clearly requested that theaters not be allowed to sell all items for sale, and posted eye-catching signs of “No eating in theaters” in theaters. After the resumption of work in July last year, a theater manager in Beijing’s Daxing District once revealed that the prohibition of eating in the movie hall greatly reduced the user’s enthusiasm for buying.
The picture shows the prompt when buying movie tickets online
As of September 25 last year, the attendance limit for each show in the cinema was adjusted from 50% to 75%. Although the country has not clearly stated its permission, it has no longer strictly controlled the sales of various theaters. “Actually, you just open one eye and close one eye. After all, the theater has to survive.”
The picture shows the regulations on movie theater attendance issued by the China Film Distribution and Projection Association
Nevertheless, a cinema manager in Shandong told DuMou that the audience’s attitude is stillVery cautious. “Some viewers gave up buying because they were worried about not being able to bring food into the theater because of the fasting sign posted in the theater. Some viewers felt that since the state regulations do not allow food, they would not buy it and were automatically persuaded to leave.”
Another change brought about by the epidemic is that more studios are trying to sell products by way of takeout. Previously, the selling methods of cinemas were mainly on-site sales, ticket purchase software, and ticket machines. Most of the takeaway business was provided by private cinemas.
During the epidemic, many large theaters have also launched takeaway services. A theater manager told Dumo that the epidemic broke out suddenly, and the theater purchased a large number of original popcorn and drinks in advance to welcome the Spring Festival stalls, and the suspension of business caused a backlog of sales. Many theaters launch takeaway services not to make money, but to clear inventory.
But because the popcorn in the theater is not cost-effective, a medium cup of coke + medium cup of popcorn can be sold for more than 40 yuan. After leaving the movie scene, the popcorn takeaway sales in theaters were not good. Looking at the takeaway software now, popcorn sales are still mainly from private theaters.
In addition, a theater manager in Changchun said that there is another “takeaway service” inside the theater, which can place an order in the theater’s own app and send it to the designated theater with designated seats. Go to the trouble of customers walking back and forth. It can be regarded as part of the theater optimization service, but it is not popular and the actual operation effect is not good.
The picture shows the food and beverage interface of Wanda Movie app
The strength of Maotao is also one of the reasons why it is difficult to do the movie sales business.
Many theater managers mentioned the influence of Maotao on the online merchandise business in an interview with Dumo. “Selling products on Maoyan and Taopiaoping platforms will earn a portion of the price difference.” This makes the sluggish sales business even worse.
For this reason, various theaters are also using various methods to stimulate sales.
Jinyi Studios mentioned in the 2020 annual report that in the future, it will strengthen the research and development of self-made products to increase the purchase rate. A theater manager of Beijing Jinyi said that this year the theater will optimize the access and evaluation standards of sellers, and more efficiently introduce Internet celebrity products, IP derivatives, and best-selling products to enhance the audience’s experience.
Other theaters also proposed similar plans in their annual reports. For example, strengthen the research and development of self-made products, and expand the sales channels of self-made products based on the success of self-made products.Carry out self-made products take-out service, so that high-quality self-made products can be turned into an additional drainage point for the studios, which will feed back the box office passenger flow.
In order to occupy the sales channels, most head theaters have opened ticket purchase applets and ticket purchase apps, and built-in larger discounts for selling products, and can also participate in various activities in the cinema more conveniently.
For example, Evergrande Jiakai Cinema has launched various activities this year, such as participating in the blind box lottery at the cinema store celebration. According to the studio staff, “The blind box lottery is actually a gift given by the studio in the past, but because the concept of the blind box has become popular in recent years, this concept allows users to increase their sense of participation.”
Pre-screening ads are still stable
After checking the annual reports of several theaters, Poison Eye found that in a year when theaters were hit hard in 2020, as a business with the least investment cost and the highest gross profit margin, advertising is still a solid profit. Buying and selling.
Classified from the venue resources of the theater, the advertising location of the theater includes pre-screening advertisements, position advertisements, etc. Relevant practitioners told Poison Eyes that the current domestic leading companies that distribute pre-screening advertisements are Focus, Wanda, and China Film. As of 2019, the national movie advertisements are basically 6 billion.
Cinema area light box advertisement, picture source network
Affected by the epidemic, the pre-screening advertising revenue of theaters will decline to varying degrees in 2020. Compared with 2019, the advertising revenue of Jinyi Studios, Hengdian Film and Television, and Wanda Films decreased by 69.34%, 79.14%, and 74.96%, respectively.
But pre-screening advertising still maintains a fairly high gross profit margin. The financial report shows that in 2020, the pre-screening advertising costs of the above-mentioned theaters accounted for 0.93%, 0.01%, and 7.68% of the total cost, respectively, and the revenue accounted for 8.13%, 4.84%, and 9.5%, and the gross profit margin was even higher. Up to 83.88%, 99.89%, 10.5%
Advertisers who want to cooperate with theaters basically have to use theater scene marketing companies similar to “intermediaries” to save the negotiation costs between the two parties and help theaters shorten the advertising space.
When signing a contract, both parties will generally take 2-3 years. During this period, the advertising rights of the theater belong to an advertising “intermediary” company.
The biggest feeling that the epidemic has brought to advertising media companies is that the cooperative attitude of theaters has changed.
OneThe person in charge of a company that specializes in cinema scene marketing told Dumou that during the two most prosperous film markets, cinemas did not attach much importance to advertising revenue. “In 2018 and 2019, when the box office performance was particularly good, there was an annual growth of about 10%. At that time, they were pretty good.”
After the epidemic ceased, he felt that theaters paid more attention to advertising business, changed their cooperation attitudes, and paid more attention to cooperation needs. “The epidemic has calmed down theaters and reflected on where they were not doing well.”
Due to the outbreak of the epidemic, many previously negotiated advertising businesses have been affected and will be postponed in the future. After the theater was closed on January 23, 2020, the advertising company left a large number of advertising services that needed to be executed during the Spring Festival. It was not until the theater reopened on July 21 that the advertising company completed the execution of the advertisements left over from the Spring Festival file.
Although the theater opened, the advertiser did not return on time. An industry practitioner told DuMou that in terms of content selection, theaters mostly prioritize car, Internet, and game advertisements, but resolutely refuse to accept risky advertisements such as medical beauty and financial management.
Pre-screening advertisement, picture source network
In the early stage of business resumption, the attendance rate is limited to 30%, and the advertising dissemination rate will be greatly reduced, which greatly dampens the enthusiasm of advertisers.
The epidemic has caused many offline industries to sharply reduce their income during the epidemic, and the budgets of advertising businesses have also shrunk or even disappeared. According to the person in charge, this situation only improved in October last year. “The new advertising business was basically entered from the National Day file last year, and it has basically returned to the working state of the same period in 2019.”
The box office performance of this year’s movies was excellent, which gave advertisers a reassurance. Although the amount of advertising cooperation has not been restored to the past, the advertising cooperation in the summer and even the National Day has already begun to be negotiated.
Entertainment consumption still to be explored
The entertainment and consumption facilities such as massage chairs, singing bars, and blind box machines that are often seen in the theater area are also part of the non-ticket revenue.
Take the most common massage chair as an example. There are two modes of cooperation between brands and theaters: leasing or sharing. Lease is to pay the rent according to the time. Sharing means that the brand does not pay the rent, but it must be divided with the theater according to the actual consumption of the user using the massage chair.
“Many times, audiences do sit on massage chairs to rest, especially during peak periods, but not many people actually use massage chairs.No usage fee will be incurred. “This is what a manager of a Beijing brand cinema said.
In addition, Poison Eyes observed that after the epidemic, some theaters “moved” massage chairs into the theater, and put the portable massage chair cover on the original seat of the theater, and then the audience scanned the chair body while watching the movie. QR code, enter the mini program, pay to start, you can control the massage chair in the mini program.
The massage chair service of the Poison Eye Experience is 15 yuan for a 90-minute massage. You can choose from three modes of shoulder, neck, waist, and full body. You can enjoy the massage service while watching a movie. The price is relatively high.
Similar to this innovative business, each theater has its own different plans.
For example, Jinyi Studios is preparing to upgrade the overall scene of the theater’s sales area, introducing animation IP themed stores, combining movie culture + animation wave culture + entertainment consumption scenes, creating a new theater social space to enhance the audience’s Sense of experience and willingness to consume.
Wanda Cinema’s exclusive IP authorization and creation of the live entertainment project “Jurassic World”: The first film special exhibition “Chengdu Station” opened in mid-last year, operating nearly 4,000 shows and receiving more than 150,000 people. The second station, Guangzhou station, has also officially opened in early 2021, and the Shanghai station will be open for operation during the summer.
The real-life entertainment project “Jurassic World” created by Wanda Films
Further opening up with online is also an important way to increase non-vote revenue. Hengdian Film and Television launched the “Hengying Life Online Mall” project, opened online live broadcast sales channels, and launched various promotional activities, online and offline collaboration to enhance non-ticket business.
According to the data on the resumption rate after the epidemic, about 10% of the stock theaters in the country may have been shut down, and some small and medium-sized theaters have withdrawn from the market. The epidemic has accelerated the change of the industry. Intensified competition, on the one hand, will increase investment, on the other hand, there is a risk of diluting single-cinema and single-screen revenue.
For theaters, from a business logic, increasing non-ticket revenue means strengthening the theater’s profitability and anti-risk capabilities.
From the perspective of user service, increasing non-ticket revenue also means creating personalized services for theaters, changing the theater from a single viewing place to a consumer scene centered on viewing.
There is still a long way to go for the exploration of non-ticket business in theaters.