This year’s International Exhibitor of the Year award at CineEurope goes to one of the oldest cinema circuits in the world: Nordisk Film Cinemas, founded as Nordisk Film in 1906 by Danish filmmaker Ole Olsen. A producer, distributor, and exhibitor of films, Nordisk Film was acquired in 1992 by Nordic media giant Egmont, which traces its own roots to the late 19th century.
The aughts of the 21st century saw a period of expansion for the exhibition side of Nordisk, which made substantial acquisitions of two Norwegian cinema chains—100 percent of the country’s largest chain, Oslo Kino AS, and 49 percent of Kinosør—and built new cinemas in Denmark and Sweden. Nordisk Film Cinemas currently stands as the market leader in Denmark and Norway, with a pair of locations in Sweden bringing the chain’s screen count in Scandinavia to more than 250.
A “pioneer in the industry,” according to Film Expo Group president Andrew Sunshine, Nordisk “has built a culture of innovation for cinema, changing the moviegoing experience in Scandinavia” in its second century of operation by introducing Scandinavian moviegoers to recliner seats and premium formats, among other innovative concepts. “They have continued to expand and strengthen in recent years and consistently offer a superb experience” to their multinational audience, adds UNIC CEO Laura Houlgatte-Abbott. In anticipation of this year’s CineEurope, Boxoffice Pro spoke to Nordisk Film Cinemas CEO Asger Flygare Bech-Thomsen, who is accepting the award on Nordisk’s behalf.
What have these last few years been like for Nordisk, in terms of the recovery process?
We are in three territories: Denmark, Norway, and Sweden. The pandemic was kind of a learning lab: It was a learning lab for us, but it was also a learning lab for society. The interesting thing was that, for three countries being as similar as we are here in Scandinavia, the pandemic was handled in three different ways. In Denmark, either you were open or you were completely closed. In Sweden, cinemas never closed down, but sometimes restrictions limited capacity to something like 20 percent. And Norway was in-between.
There was a lot of discussion about, “Couldn’t we just keep cinemas a little open instead of being completely closed?” But you have to judge what our politicians decided by what happened after Covid. How fast did you recover? I would say that a country’s handling of the pandemic, as a whole, mirrors how it was handled for cinemas. Denmark recovered very fast. That came from consumer confidence, which was already much higher going through pandemic. A cinema was either closed or it was open. When it was open, it was regarded as safe. So when we opened after the pandemic, the confidence quickly rose, and we gained traction very fast. Sweden has been way slower than both Norway and Denmark in recovering from Covid.
As a company, we had to learn some new tricks of the trade. We found new ways of doing things that actually benefit us today. We have a much, much healthier business, I would say, after Covid.
How was Scandinavia’s local film industry impacted by the pandemic? Were you able to screen more local titles, with Hollywood imports being thinner on the ground during the recovery?
Local titles are a big thing in Scandinavia. We are usually between 20 and 30 percent in market share for our local titles, for each of the countries.
But here, again, how you managed Covid [factored] in. If you are a distributor, would you like to release your movie when capacity is [capped] at 50 percent? It was easier for the distributors in Denmark, because when the cinemas were open, they were nearly completely without restrictions. Of course, you would have to wear a mask and everything. But still, it was open. And that meant that the distributors could easily release their movies. It’s nothing like a situation where you’re maybe open, but you’re restricted to about 20 percent of your capacity. What distributor would like to release their movie in that territory? That was the main problem, the availability of movies.
The interesting thing is that, before, we very much discussed this industry as completely content-driven. What you learn when you only have 20 percent of the titles, and you find you have 60 percent of the admissions, is that we are also very much demand-driven. Meaning that people want to go out. If they want to go out, they want to have a cultural experience. If they have to choose between cultural experiences, a cinema is very available. It has a lot of showtimes. Even in small towns, it’s available. I would say that we learned a lot from this learning lab, as I call Covid. And one [thing] is that we are probably just as much demand-driven as we are content-driven. If you [are] well-covered with titles, all genres, and all target groups, you are doing quite well, even with fewer titles.
Has that shift in the way you think about the business—from a more content-driven mindset to one where supply and demand are equal factors—changed your approach at all, in terms of programming, marketing, or general operations?
Yes, it has a little. We are very aware [now] that we need to fill out all the boxes for all the genres and target groups. There were more movies than we could really give attention to before Covid. The number of titles had gradually increased up until Covid happened. So I would say we’ve been more aware that we have to cover the genres and the target groups, in order to actually harvest the demand that is out there. Of course, if you have a larger number of titles, you can offer each target group or each genre several titles. That will, of course, increase the number of admissions you can have.
Speaking on a global scale, the cinema industry has found that premium formats have been effective in bringing back moviegoers. Has that been your experience? What does Nordisk’s premium format footprint look like?
We see the same thing. The larger formats are popular despite the fact that we charge a premium price. If there’s a limited supply and one of the movies is in a premium format, it sells out first. It’s the same at the screens where we still have classic seats and maybe one row of recliners: The recliners always sell out first.
We operate 4DX [screens]. We have a THX Ultimate screen in Copenhagen, the capital of Denmark. And then we have our own large premium format, called Supreme. They’re usually in the largest auditoriums in our multiplexes, and they do quite well.
What are your concessions offerings like? Attitudes toward concessions can vary so widely between markets—in North America, for example, dine-in theaters have become very popular, but in France the moviegoing experience is historically much less geared toward concessions. What’s the state of concessions in Scandinavia?
We are still in the test phase of finding out what flavors the Scandinavian audiences like. There’s no one who’s [created] a real kitchen with a lot of hot food, so we’re still in our infancy there. We are looking to the experiences in the United States and the United Kingdom, which are definitely ahead of us [in that regard].
The interesting thing is that the first recliner was introduced in Denmark in something like 2015. The audience has taken to that very quickly. [Expanded food offerings have] done exactly the same. We are a little behind in terms of those offerings, recliners and food. But I will say, there are no surprises in Scandinavia, in that what works in the United States probably would also work in Scandinavia. That is what we have experienced. In our portfolio of cinemas—we have 48—three of them [have been recently] fitted out with kitchens. We’re still in the learning phase about what are the best offerings we can have. What are the price points?
Nordisk is one part of Egmont, which has business in all different types of media and entertainment: magazine publishing, video games, books. Nordisk itself, outside of exhibition, is involved in digital signage and film distribution. Are you able to apply insights from different parts of your parent company to your operations as an exhibitor?
Egmont is a foundation supporting children and young people that come from families and backgrounds with few resources. [Editor’s note: The profits from all Egmont’s companies are either reinvested in its media or donated to help children and young people at risk.] That common baseline is very important for all of us.
In terms of the business side, yes, we work together when there is a sound reason for it. And even in Nordisk Film—where we have production, film distribution, and cinemas—we operate each leg as an individual [company]. If our [production arm] was limited to only produce what I would have in cinemas, they would miss out on some talent. They would probably miss out on opportunities that other production companies would pick up. So our production company must have freedom to compete freely with all other production companies. And if Nordisk Film cinemas was to screen only movies that were either produced by us or distributed by us, we would miss out on a couple of very important movies. We are very aware that each of the companies has its own place in the industry. We compare notes, I would say, on general trends in the industry.
Is there any room for growth in the Scandinavian markets? Or is your focus more on elevating the theaters you already have, in terms of things like recliners, premium formats, and expanded concessions?
The three markets in Scandinavia are very mature. We’ve been in business for over 100 years. It’s not like there are green fields all around us. It’s like the end of a Monopoly game: There are houses everywhere. So there’s limited opportunity here for growth. But there are possibilities. We and the competition are still investing. If we are going to develop this industry, [that’s what we have to do].
We are also [renovating] here and there. Actually, we are renovating [one location] in October. [The new theater] will have a higher capacity [and will be] full-recliner, of course. It will maybe have a 4DX as well; we haven’t decided that.
The whole thing here is that the industry needs to keep on investing. The markets in Scandinavia are a little bit different in terms of how much they have been invested in. I would say the competition is a bit more tough in Denmark. The capacity has been growing more than admissions—also before Covid—and that means tough competition.
Could you give me a top-level overview of what your sustainability efforts look like at Nordisk? I know it’s an important priority for you.
Sustainability is a big issue for Egmont, our parent group, and also with us. The interesting thing is that when we ask our guests to rate different things in our cinemas, how important they are for them—for example, recliners, food and beverage, and so on—[our carbon footprint is] in the lower quarter [of things our customers care about].
So it’s not directly important when you ask the guests about it. Where it is very important is with our staff. Biannually, we do a staff survey. Our staff, our colleagues—they rate us as leaders. They supply a lot of comments, and that is very helpful. From that, we can see that for our own colleagues, sustainability is very important. I would say we’ve been interested in it for quite a long time.
We have gone from what I would call phase one to phase two. In phase one, we focused very much on doing all the things that we saw would have an impact. That means [switching to] LED screens. Automation of ventilation and heating systems. We remotely control all our booths. From three operations centers; we can control 260 sound screens, which means there are no people in the booths. That’s very efficient. Heating and ventilation are also controlled remotely. All these basic things, that’s phase one.
Phase two, which we are implementing now, is mapping completely what our carbon footprint is. We use the Greenhouse Gas Protocol, like most Fortune 500 companies, and that is a time-consuming process. The management team in Nordisk Cinemas—and the level under them—has a mandatory target for their carbon footprint. They also have a mandatory score [to hit], when our employees complete the biannual survey about how they feel at the company and how they score us as management.
One last comment on this: When you do the greenhouse gas protocol, it’s divided into scope one, scope two, and scope three. Scope one is the energy [one’s employees] consume [in the course of business]: traveling in cars, flying in planes. Scope two is energy [consumed in] cinemas. Scope three is what comes from your value chain—mainly concessions, but also [materials used to] refurbish cinemas.
We’ve been focusing on scope two, and we’ve improved that. But what we learned from mapping our footprint is that scope three—the supply chain—has a much, much larger footprint. The footprint we have from electricity, power, and utilities in all our cinemas—the supply chain has a footprint six times bigger. That is an interesting conclusion for us. We are going to work with our suppliers to improve it.