What Type(s) of Promotion Could Attract More Attendance at Cineplex Cinemas?
Faculty of Commerce and Business Administration, Douglas College
What Type(s) of Promotion Could Attract More Attendance at Cineplex Cinemas?
Despite being the leading company in “film entertainment, amusement and leisure, and media sectors” in Canada (Cineplex, n.d., para. 1), Cineplex still experiences a drop-in attendance at its cinemas (Deschamps, 2019a). This paper explores some insights into which type(s) of promotion might aid in growing its movie ticket sales. To better understand the situation, we will make use of an exploratory approach to collect relevant and helpful data. This paper’s outcome will be the supporting resource for the team in designing the next research steps, including focus group and survey.
Methods
In order to obtain relevant and up-to-date secondary data, an online search was conducted. The criteria for evaluating secondary data has served as the guidance for evaluating and choosing resources (Malhotra, 2012). The search engines Google and Bing are crucial for the data collection. The following keywords were listed to make the search process organized and to filter out irrelevant or not credible information: Cineplex, Cineplex promo, Movie theaters in Canada, Movie theaters industry, Cineplex competitors.
Cineplex and Cineplex Investor Relations websites provided us with meaningful insights regarding the brand and revenue. The Scotiabank, partner and sponsor of Cineplex, have the website page that is dedicated to the promotions which companies run together (Scotiabank, n.d.). Moreover, we have evaluated competitors’ websites to find the promotions they offer to their clients. All these resources have proven to be relevant, accurate and trustworthy, therefore they were chosen for further analysis.
Findings and Analysis
The question that we established raises the issue of declining attendance at Cineplex theatres and the attempt to fix it via new promotion channels or activities. Deschamps (2019a) states that the attendance of the fourth quarter of 2018 had dropped by 3.2 percent in comparison with the same period of 2017, still the company’s president and chief executive officer Ellis Jacob has a positive outlook. Unlike the CEO of Cineplex, independent scholars claim that there is an inevitable decline predicted for the Canadian movie market until 2023 (MarketLine, 2019). This pattern seems to have emerged several years ago, as Cineplex Inc. (2019) reports that theatre attendance rate declined by 1.6% in 2018 as opposed to 2017. Dana Feldman explains that the movie theaters are struggling with lack of customers because of the increased popularity of Netflix and similar streamer websites (Feldman, 2019). This indicates that possibly money could be the reason behind the decline in sales of Cineplex as customers prefer to just pay a one-time subscription fee over buy tickets for each movie at the theatre. However, recently UK-based cinema chain Cineworld has announced its plan to acquire the Cineplex and to start selling unlimited monthly movie passes in Canada, as they do with their local branches (Sagan, 2019). In other words, customers can watch as many movies as they want for a small membership fee (Sagan, 2019)
Regarding its competitors, Cineplex’s biggest direct competitor is Landmark Cinemas (Toneguzzi, 2019); the CEO of Landmark Cinemas Bill Walker said that Landmark is “the second largest player (to Cineplex) but a really distant second” (Toneguzzi, 2019, para. xx). The Landmark’s promotions are on a much smaller scale than Cineplex’s. Their loyalty program is called Movie 10-pack, where clients get ten percent off with ten tickets that are on the card (Landmark Cinemas, 2020). However, three Cineplex’s most prominent rivals (ranked accordingly) are EOne, Netflix and NBCUniversal (Owler, n.d.). EOne is an entertainment company that combines “every step in the entertainment value chain from development and production to marketing and distribution” (Entertainment One, 2017, para. xx). While Netflix and EOne are similar, NBCUniversal is a mass media conglomerate (NBCUniversal, 2020). None of the three companies is a direct competitor for Cineplex, which indicates the need to alter the promotions to target the competitors’ markets. It is crucial to define the added value of Cineplex’s experience such as offering games and food incentives versus the one offered by, for example, Netflix.
For many years, Cineplex has been providing services intending to increase the attendance rate and to earn profit by using effective promotional strategies and concession stand offerings at the cinema halls. In 2007, Scotiabank and Cineplex launched SCENE, Canada’s first loyalty program in the entertainment sector (Cineplex, 2015). It has resulted in SCENE Visa card that allows customers to earn points and then redeem them for free movies, food and drinks (SCENE, 2020). This partnership has proven to be beneficial for both sides and created a valid promotion to attract new customers and retain the existing with the loyalty program. The Cineplex annual report shows that by the end of 2018, the SCENE loyalty program’s membership reached 9.6 million members, increased by 0.7 million from the previous year (Cineplex Inc., 2019).
Cineplex is known for actively pursuing the diversification strategy, partnering up, especially with the closest industries, Food and Entertainment. In order to increase the satisfaction of the customers, Cineplex usually provides excellent variety and concessions on food and beverages. It works closely with several leading food organizations such as Tim Hortons, Starbucks and Pizza Pizza. It also serves alcoholic beverages at specific licensed locations (Movie Theater Prices, n.d.). Besides, Cineplex partnered with CJ 4DPlex to introduce 4XD Auditoriums at specific locations to amaze customers with 4D effects (Bench, 2019). This demonstrates that Cineplex is planning to create a competitive advantage over the online movie streaming websites and in the overall industry by redefining the cinema halls with high-tech advancements and developing them into a whole new entertainment destination for the customers (Deschamps, 2019b). There is no specific information indicating the positive effects of offering promotion with food, drink, and 4D technology on theatre attendance. However, it is expected to augment the customers’ experience at the theatres and possibly promote them to come to the theatre to enjoy greater satisfaction.
According to Cineplex annual reports, while there was still a drop by 1.6 percent in the theatre attendance in 2018, the situation had been improved as compared with a 5.6-percent decrease in the full-year 2017’s record (Cineplex Inc., 2018, 2019). Although there is no full report of 2019 published by Cineplex, it could be expected that there is a sight of improvement when using partnerships and promotions. The analysis conducted creates the direction for further research on the problem.
Implications and Conclusion
Marketing Research Problem
Through secondary research, two main reasons that keep our group’s intention to continue with the marketing research problem. The first consideration recommends the need to alter promotions to target both direct and indirect competitors’ markets. The second finding indicates that while there is no figure specifically relating the promotion to the attendance decrease, it is anticipated that promotion, providing experience with more value-added, could attract customers to go to the theatre.
Research Design
Despite Cineplex’s effort, attendance of the theatre still declines while facing substantial threats derived from alternative streamline services such as Netflix. Although the secondary research does not discover the direct relationship between promotion and theatre attendance in the past, it indeed points out that there are existing promotional programs offered by Cineplex, which enhanced and added value to the customer’s experience. Hence, the collected information does help the team to draw the direction of the following research stages, which are a focus group and survey research. The detailed design and questions have not finalized yet. However, it might focus on defining how customers react to the existing promotion programs, the customers’ rating on experience or value received from those promotions, the overall effectiveness of them, and customers’ comparison between going to a Cineplex theatre and enjoying other competitors’ offering. From that, hopefully, the result could discover which type(s) of promotion brings the highest possibility of increasing the theatre’s attendance, giving some ideas of which options are available and most suitable to choose from.
Answer to the problem
In summary, the secondary data research emphasized the stated marketing research problem that we need to consider which promotion(s) will be suitable to solve the problem of declining attendance in Cineplex theatres. The collected information, which are the promotion options and the relevant competitors, will contribute to the structure and topic of the next stages which are a focus group and survey research.
References
Bench, A. (2019, October 23). Cineplex set to open 4DX in Edmonton, featuring moving seats, special weather and scent effects. Global News. Retrieved from https://globalnews.ca/news/6074652/cineplex-4dx-edm
Cineplex. (2015). Cineplex and Scotiabank announce 10-year extension of SCENE loyalty program. [PDF file]. Retrieved from http://irfiles.cineplex.com/11-06-2015-Cineplex-and-Scotiabank-Extension-Press-Release-FINAL2.pdf
Cineplex Inc. (2018, February 21). Cineplex 2017 annual report. Retrieved from http://irfiles.cineplex.com/reportsandfilings/annuallyquarterlyreports/2017/5528%20-%20Cineplex%20AR%20For%20Online2.pdf
Cineplex Inc. (2019, February 14). Management’s discussion and analysis. Retrieved from http://irfiles.cineplex.com/reportsandfilings/annuallyquarterlyreports/2018/CineplexMD_A%20(Annual)%20-%20FINAL.pdf
Cineplex. (n.d.). Corporate. Retrieved from https://www.cineplex.com/Corporate/Information
Movie Theater Prices. (2017). Cineplex food prices. Retrieved from https://movietheaterprices.com/cineplex-food-prices/
Deschamps, T. (2019a). Cineplex profit drops as theatre attendance declines. The Global and Mail. Retrieved from https://www.theglobeandmail.com/business/article-cineplex-profit-drops-as-theatre-attendance-declines/
Deschamps, T. (2019b). Cineplex’s CEO sees life beyond Netflix and a future with high-tech golf. The Star. Retrieved from https://www.thestar.com/business/2019/11/21/cineplexs-ceo-sees-life-beyond-netflix-and-a-future-with-high-tech-golf.html
Entertainment One. (2017). About EOne. Retrieved from https://www.entertainmentone.com/about-eone/
Feldman, D. (2019). How Netflix is changing the future of movie theaters. Forbes. Retrieved from https://www.forbes.com/sites/danafeldman/2019/07/28/how-netflix-is-changing-the-future-of-movie-theaters/#2aff5c875f46
Landmark Cinemas. (2020). Movie 10-pack. Retrieved from https://www.landmarkcinemas.com/movie-deals/movie-10-pack/
Malhotra, N. K. (2012). Basic marketing research: integration of social media (4th ed.). Boston: Pearson.
Marketline. (2019, October). Industry Profile: Movie & entertainment in Canada. Retrieved from https://0-search-ebscohost-com.orca.douglascollege.ca/login.aspx?direct=true&db=bsu&AN=139772095&site=ehost-live&scope=site
NBCUniversal. (2020). Who we are. Retrieved from http://www.nbcuniversal.com/who-we-are
Owler. (n.d.). Cineplex’s competitors, revenue, number of employees, funding and acquisitions. Retrieved from https://www.owler.com/company/cineplex
Sagan, A. (2019, December 18). Unlimited movie passes likely coming to Canada after Cineplex buyout by Cineworld. HuffPost. Retrieved from https://www.huffingtonpost.ca/entry/cineplex-unlimited-pass_ca_5df8f0dfe4b0ae01a1e7fd7e
SCENE. (2020). It’s easy to get free rewards. Retrieved from https://www.scene.ca/en-ca/?refcode=WSEP1BE&lan=en&card=blackcard&gclid=Cj0KCQiAvc_xBRCYARIsAC5QT9mcKgxLtjhrXjsMF_4dEys4kMUO0QkvtQsSjlJ26puEsb0LcA-j2O0aAs-EEALw_wcB
Scotiabank. (n.d.). The SCENE®* Program. Retrieved from: https://www.scotiabank.com/ca/en/personal/programs-services/scene-program.html
Toneguzzi, M. (2019). Landmark cinemas sees success amid continued cross-Canada expansion. Retail Insider. Retrieved from https://www.retail-insider.com/retail-insider/2019/10/landmark-cinemas-sees-success-amid-continued-cross-canada-expansion
| Assessment parts | Marks* | Percent |
| Introduction | 10 | 9 |
| Method(s) | 10 | 9 |
| Findings (min. of 15 references) | 10 | 8 |
| Analysis | 25 | 23 |
| Implications and conclusion | 45 | 37 |
| Total | 100 | 86 |
| The paper shows a good understanding of what secondary research is. The data and analysis are good overall. Well done!
|
||
What Students Are Saying About Us
.......... Customer ID: 12*** | Rating: ⭐⭐⭐⭐⭐"Honestly, I was afraid to send my paper to you, but splendidwritings.com proved they are a trustworthy service. My essay was done in less than a day, and I received a brilliant piece. I didn’t even believe it was my essay at first 🙂 Great job, thank you!"
.......... Customer ID: 14***| Rating: ⭐⭐⭐⭐⭐
"The company has some nice prices and good content. I ordered a term paper here and got a very good one. I'll keep ordering from this website."
