Cinema advertising: Rising from the ashes

In their quest for the consumer's attention, advertisers are rediscovering cinema

Why are advertisers flocking back to cinema theatres?

Over the past three years, ad revenues have doubled for almost every major theatre chain in India, hitting a total of roughly Rs 250 crore in 2010-11. This is over a fifth of what advertisers spent on radio and a third of their online ad spends in the same period. At a 35-40 per cent rise year-on-year, cinema advertising is growing faster than online, radio or overall advertising growth, where the annual growth is about 11 per cent.

This growth is funded not by the local saree shop or restaurant coming for a day but by large national advertisers such as L’Oreal, Maruti, Tata DoCoMo and Samsung, coming in for months at a time. These kind of sustained cinema campaigns were unheard of even three years before.

From almost nothing, national brands are now spending up to one per cent of their advertising budgets on multiplexes and single-screen digital theatres. A little more than 80 per cent of the Rs 50-odd crore that PVR made in ad revenue in March 2011 came from national advertisers. This is true for most chains. “More than 45 per cent of our business (now) is long-term. These are campaigns that last for six months and more,” says Gautam Dutta, chief operating officer, PVR.


HOW IT WORKS

While TV and print have well-defined norms and metrics, cinema is as yet a hazy area for advertisers and media people. Some of the basics of advertising in cinema halls:
* Typically, there is 15 minutes of ad inventory. Most theatres play seven minutes before the film and seven during the interval
* If the chain is digital inventory could be sold in any unit a 10, 30, 60 seconds and so on
* If the chain or screen is analog, inventory is usually sold in 60 second units. Since TV ads are 30 seconders and most brands do not shoot special ads for cinema, it explains why you see the same ad twice sometimes
* It could cost anywhere from Rs 2,000-20,000 per 30 second, per screen, per theatre, per week, to advertise with a chain

One such long-term advertiser is Lufthansa. It now spends 10 times the money it did on cinema four years earlier. “Cinema came as a complete surprise to us,” says Sangeeta Sharma, manager, marketing communications, South Asia, Lufthansa. About six years before, the airline, focused on the business traveller, decided to enter the leisure segment. This pushed it to experiment with several things — coffee table books and cinema chains included. Soon, it was doing on-screen commercials, ticket jackets, on-site ads and online ones with PVR across India. The results were good. According to a brand track Lufthansa does, brand recall is up 17-100 per cent.

What’s the scene?

Alok Tandon, CEO, Inox Leisure, emphasises: “About 3.5-4 billion movie tickets are sold in India every year. That means every Indian goes to a theatre 3.5 times year. Movie theatre ads have reach.” They always had. However, three things conspired to make cinema more appealing to advertisers.

The first, says Arun Tyagi, business head, Big Cinemas, was a structural shift in the way theatre advertising is sold. Till five years before, advertisers had to use a handful of agencies such as Dimples or Salvos. These navigated a fragmented market, with 12,000 individual screen owners. As PVR, Inox, etc, got bigger, they started appointing their own sales teams. These have done a better job of selling the medium to advertisers.

Second, the growth of multiplexes unleashed a creativity that the Rs 14,000-crore Indian film industry hasn’t seen since the ‘70s. As audiences started returning to the theatres, cinema came on to the media planner’s radar.

Anita Nayyar, CEO, India and South Asia, Havas Media, reckons, “It is a great medium if you want the undivided attention of the audience.”

That is the third, arguably biggest, reason. Most consumers in over-served media markets like Mumbai, Delhi, Chennai, etc, get hit with huge amounts of advertising on TV, print and other media. If you live in any of the top 10-12 cities, you probably screen out ads automatically. In a dark theatre, however, you are easy prey. You have to switch off your mobile. There are no doorbells, colleagues, other media, nothing to take your attention away from the screen. You have probably paid Rs 100-400 to watch a film. All this makes you a coveted target.

This is borne out by the numbers. Dutta says roughly 80 per cent of the ad spends on PVR are targeted at screens located in Mumbai, Delhi and Chennai. Brands wanting to reach out to consumers in these cities usually spend more. Loop Mobile, which operates only in Mumbai, spends five to 10 per cent of its budget on cinema.

Arif Ali, vice-president and head, brand communications, Loop Mobile, says cinema supplements the TV effort. The digital chains agree. “Cinema is adding to your reach,” says Arvind Ranganathan, CEO, Real Image.

Cinema versus TV

However, unlike rating points in television, there are no metrics in cinema. There are some efforts to tackle that. According to a study done by Nielsen, Real Image’s network of 475 screens in Tamil Nadu was the second-most effective after Sun TV. Both the digital chains, UFO and Real Image, use TV as a benchmark for pitching and pricing.

Not all multiplexes are comfortable with that. “TV can’t be a benchmark because we can’t give the same reach,” argues Sunil Punjabi, CEO, Cinemax India. What establishes reach for cinema is the audience numbers, he thinks. For instance, Cinemax had 17 million footfalls last year and PVR had 26 million.

For now, that seems enough to keep the advertisers coming.