Receiving NATO’s Marquee Award at this year’s CinemaCon is Ellis Jacob, a man who—as CEO and president of Cineplex, Canada’s largest exhibitor—was instrumental in leading the Canadian corner of the exhibition industry through the Covid-19 pandemic. The last year has not been an easy one for exhibitors in that country. As Spider-Man: No Way Home was racking up record-breaking opening-weekend grosses in markets around the world, cinemas in the Canadian province of Ontario had just been hit with a 50 percent capacity limit, causing a last-minute scramble to accommodate moviegoers who had already bought tickets. Days later, cinemas were among the industries ordered temporarily shuttered in Quebec, further impacting Canadian cinemas’ ticket sales for what would become North America’s sixth-highest-grossing film.
A 35-year veteran of the cinema exhibition industry, Jacob served as chairman of NATO prior to the tenure of current chairman Rolando Rodriguez, putting him in the thick of the industry’s fight for survival. Says Rodriguez, “Ellis Jacob, while running his own company, dedicated countless hours to guiding the industry through our deepest crisis. It is impossible to overstate his contribution to NATO and his leadership. As his successor as NATO chairman during the worst of the pandemic, I know firsthand what that leadership meant to the industry and to me. We are stronger because of him.”
Jacob’s impact on the industry, however, extends further back than these last few years. He has overseen his circuit through times of innovation and transformation—including recently, with the adoption of Cineplex’s first subscription program and the chain’s continued investment in entertainment centers. Says NATO president and CEO John Fithian: “Ellis Jacob is quite simply a marvelous human being, He provided steady and insightful leadership as NATO chairman as the industry descended into the depths of the pandemic, and I continue to rely on his wise counsel. His dedication to his company and this industry is unmatched. That dedication is paired with a kindness and courtesy that is rare and is a hallmark of his career.”
The government-mandated closures that hit key Canadian provinces in December couldn’t have had worse timing, given the imminent release of Spider-Man: No Way Home. How do you characterize the state of the Canadian cinema industry?
I feel very strong about the recovery. Cineplex and the exhibition industry in Canada is making progress, and we are moving forward from the effects of the pandemic. We got hurt the last couple of weeks of December when a number of locations across the country, the main locations, were shut down. Plus, we weren’t allowed to sell concessions in our biggest markets, in Ontario and Quebec. Those were tough times, because those are usually our busiest weeks of the year. With Spider-Man it was even harder—we took a big hit because theaters either weren’t open or they weren’t serving food during that period of time.
Even with that, revenue in Q4 2021 was 70 percent what it was in the same period in 2019, pre-pandemic.
That is correct. It was our best quarter in the last two years, since the pandemic started. Sadly, had we been open for the last few weeks of December, I think we would have had a fantastic overall quarter. That hurt us as we moved forward.
These last few years have made very clear how important it is for a circuit to diversify its offerings, whether that’s on the programming side—showing event cinema, local cinema, international cinema in addition to Hollywood tentpoles—or the operational side, like with dine-in and family entertainment centers. Even pre-pandemic, it seems like Cineplex really realized the importance of that, investing heavily “alternative” cinemas.
In the cinema itself, we have continued to evolve the experience. We are very focused on being the leader when it comes to non-Hollywood films. [Especially] if they are Canadian films, or if they’re films from other parts of the world. We are a very diverse community. And we have been the leader in North America in Hindi, Punjabi, Chinese, and Filipino films. To me that’s really important in bringing the films to our audiences. In addition to that, we have event cinema. We program The Met: Live in HD, and we [did] the BTS: Permission to Dance concert.
[Regarding] diversification: We continue to look at strategies where we can create an entertainment event for our guests. It’s more than just movies. It’s about getting the benefit of entertainment centers, which we call The Rec Rooms and Playdiums. They have done extremely well for us. It’s owning our ecosystem that becomes important. So far, we have 10 locations of The Rec Room and three locations of Playdium, and we continue to look at other alternatives. Beyond that, we’ve come up with a new concept called Junxion. It’s going to be a movie theater, a dining destination, and an entertainment complex all in one. It’s about sharing experiences.
Success in reaching a corner of the market—with Bollywood films, for example—doesn’t come overnight. What do you have to do to build up that awareness and interest over time?
We have seen some strong numbers from our Punjabi and Indian films in Canada. We have some of the highest grosses in North America when it comes to these diverse films. We have a Scene loyalty program, which helps us in understanding, by theater, what movies are working and which guests are coming to those movies. It’s a really, really strong tool in being able to program each individual location with the content that works best. There are some cinemas where the Bollywood product outgrosses the Hollywood product. There are a number of locations across the country, but you have to know where they are and how to program them. Our loyalty program allows us to do that, because we know who’s coming to see which movie.
Your loyalty program is one of the most successful cinema loyalty programs in the world, in terms of market share in Canada. It was recently retooled with a Scene Plus plan. Can you walk us through your loyalty program and how it’s evolved?
We have a long relationship with Scotiabank. Back in 2007 we launched our loyalty program, which is called Scene, and it continued to gain traction. We had a market share of close to 40 percent of households across the country that were part of this loyalty program. It gives you great data, and that data can be used for a lot of different things, in improving the business and communicating with our guests on an ongoing basis. It allows us to unlock a lot of value.
Now, Scene Plus launched [last December]. It’s basically taking the Canadian Scene program and launching it with Scotia Rewards. Now Scene Plus members can get the benefits of movies, entertainment, dining—but they can also get travel, shopping, banking, and other options that they didn’t have previously. It’s going to be a very, very strong program as we move forward.
Something else Cineplex launched over the last year is CineClub, your first subscription program. MoviePass wasn’t in Canada, so for most of the Canadian public this is the first cinema subscription plan they’re able to subscribe to. What’s been the process of raising awareness and interest in the plan, especially given that it launched during a period when the flow of movies into theaters was somewhat sporadic.
We launched our program in August of 2021. It basically gives our guests the ability to enjoy our theaters, our location-based entertainment venues, and the Cineplex Store at a fair price. It’s a monthly amount [of movie tickets], but if you don’t go to the movies [that month], you don’t lose the benefits. You can carry it forward. And you can use the program to bring a guest with you at the same price. There are certain rules, but at the end of the day, it’s a huge benefit. The reason we did it is we wanted to build habitual moviegoing again and made sure that it was a no-risk proposition for our guests.
We want our guests to get out of their homes and reconnect with family and friends. We offer so many different ways to watch movies in our theaters, from our UltraAVX, which is our PLF, to our VIP locations to ScreenX to 4DX to Imax. You can come and see a movie in many, many different ways in the cinemas. That is really important to me, because you cannot replicate those experiences at home.
Cineplex has diversified in terms of its B2C cinema business. On the B2B level, you have the Cineplex Digital Media digital signage company, which has been part of the Cineplex umbrella for some time now—going back to 1998.
It’s been a very good business for us. It basically expands our marketing and media abilities. We do own [in-theater advertising network Cineplex Media]—we haven’t diversified it away, like in the U.S., where a number of [exhibitors] got together and created [in-theater advertising company National CineMedia]. In Canada, we basically have that company. It’s part of Cineplex. Now, with the digital side, we can put out many millions of impressions right across the ecosystem, from in the theater to shopping malls to banks to retail-branded locations to all kinds of different places. There are a lot of touch points that it allows us to have.
Are there benefits, as an exhibitor, to being a vendor as well? Does it give you additional insights into the industry?
The benefit of that is, for example, if you’re a studio we can help you and basically market your movie in all of these different channels. We can also do that with our guests, for anything that we want to market or specialize with. It also allows us to communicate. We have this gaming business, Player One Amusement Group. We supply games not just to Cineplex, but to some of our peers in the U.S. We supply to many games facilities right across North America. To me, that business is all about interactivity and making the awareness levels higher, so people can come and enjoy those experiences.
Any final words?
The most important message I’d like to get out is that our business is going to be strong and is going to continue to be an important and integral part of the social experience of guests around the world.