Geneva Convention 2016 Recap: Millennials, Digital Ticketing Dominate the Conversation

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We’ve all heard the warnings. The latest technology always seems to be lurking around the corner, poised to become the next “cinema killer.” Exhibition has proved to be resilient, however, weathering innovations like radio, television, home video, cable, video games, streaming, and the countless others that have emerged over the years. Despite the foreboding, younger generations continue attending the cinema. At a certain point you have to wonder, why doesn’t the conversation instead focus on exhibition’s ability to adapt and adopt the latest innovations?

This year’s edition of the Geneva Convention, which took place from September 13 to 15 at the Grand Geneva Resort & Spa, sought to tackle that question beyond the scope of its regional association with NATO of Wisconsin and Upper Michigan. A mix of international panelists gave the Midwestern event a cosmopolitan vibe, bringing insights from different parts of the world to the talks and presentations held in Lake Geneva, Wisconsin. Although the week’s conversations ranged in topic, the theme consistently came back to the influence and impact of millennials on the exhibition business—as well as the growing shift in how consumers are purchasing their tickets.

Despite the abundance of entertainment options at their fingertips, millennials are still loyal moviegoers—an assertion echoed by NATO Data and Research Manager Phil Contrino during one of the event’s sessions. Exhibitors’ interaction with this generation, however, isn’t limited to the ticket counter and concessions stand. As millennials grow their ranks in the professional world, theater managers are faced with new challenges of how to manage a generation imbued with an entrepreneurial spirit and differing priorities. Author and speaker Lisa Orrell, who specializes on managing millennials in the workplace, focused her presentation on how to address this generational gap in the current labor force.

According to Orrell’s presentation, a typical large company in the United States will see 30 to 40 percent of its staff reach retirement age within the next 15 years. This shift will mean that by 2025, 75 percent of U.S. workers will be millennials—and most of them are transitioning to leadership roles sooner and younger than the previous generation. This might exacerbate the tense relationship Orrell sees between Gen X managers and millennial (Gen Y) employees, which she says can mimic sibling dynamics due to their relatively close ages.

She also addressed millennial’s high turnover rates at businesses, especially when conflicts arise. “What you put up with for 5 to 10 years, they’ll put with for 5 to 10 weeks,” Orrell said. Millennials are not afraid to leave companies and go out on their own, but that entrepreneurial drive can easily be managed by giving employees more responsibilities. “Leadership doesn’t start when you get a big raise and find yourself in a corner-office situation,” said Orrell. She asked attendees what they could do at their organizations to make their employees feel more entrepreneurial.

That is not to say that Gen Y is management averse, but simply that they tend to respond well to being granted responsibilities and opportunities. “One of the biggest complains that I hear from them is the lack of individual one-on-one time from managers,” said Orrell. “They want to be heard.” In this regard, Orrell believes that focusing on a thorough employee training program can go far toward establishing a high standard in workplace culture. Furthermore, a mentorship program can prove to be highly valuable in developing and retaining existing talent.

As this year’s box office results show, Gen Y isn’t the only demographic helping push box office sales. Entering October, three of the top six highest-grossing films domestically are animated titles (four if you include Disney’s CGI-heavy Jungle Book), led by Finding Dory with more than $483 million. Family audiences are crucial for the industry, a fact that Alamo Drafthouse is keenly aware of according Henri Mazza, VP of special events for the Austin-based circuit. During a panel discussion on audience engagement, Mazza shared Alamo’s positive experience in implementing a family program across participating locations—promoting a moviegoing habit at an early age. France has gone a step further with the concept, according to Julien Marcel, CEO of Webedia Entertainment and Boxoffice Media. Marcel cited the 2014 agreement by French exhibitors and distributors to enact an optional discount-pricing plan of €4 per ticket for children under the age of 14, applicable for any show time on any day of the week.

Midwestern audiences should be familiar with value pricing if they’ve visited a Marcus Theaters location in recent years. The company has instituted a $5 Tuesday offer, which includes a discounted admission and, for loyalty program members, a complimentary popcorn. Tanya Easterman, senior relationship manager at the U.K.’s Cinema First, an organization dedicated to promoting cinema attendance, recounted her own experience developing value-pricing models through commercial partnerships during her time at ODEON Cinemas. More recently, Easterman and Cinema First have been busy launching Meerkat Movies in conjunction with comparethemarket.com, an aggregator site for the U.K.’s insurance market. Customers who purchase an insurance product through the website receive a 2 for 1 voucher for any Tuesday or Wednesday at participating cinemas. The promotion has already saved U.K. moviegoers £27 million since its launch and currently accounts for 3 percent of the market’s total admissions.

While value pricing has certainly gained traction in North America, unlimited subscription models have yet to be adopted by exhibitors themselves. In both France and the U.K., unlimited models tied to a loyalty program have proven to be fruitful for exhibitors such as UGC and Cineworld. In the United States, however, only Moviepass, a third-party service that isn’t exclusively affiliated with any single circuit, has embraced the concept. The company changed its pricing scheme over the summer, with offers ranging from a monthly fee of $15 to $21 for the ability to watch up to two films to unlimited viewing options ranging from $40 to $50. The shift to include a lower price tier, targeting people who aren’t looking to go to the cinema more than twice a month, is an interesting development as the company looks to expand its subscriber base amid a rapidly changing ticketing culture in North America.

Boxoffice has been tracking these changes in consumer culture throughout 2016, as mobile technology transforms digital ticketing. We reinforced that notion in Geneva, where Boxoffice held a special panel presentation on ticketing’s new frontier. Drawing on a statistic included in his CinemaCon 2016 presentation, Julien Marcel reminded Geneva attendees how digital ticketing in China went from 0 to 80 percent of the box office in only a matter of years. Marcel estimates there are up to 20 different third-party ticketing companies working in China today. In comparison, he mentioned that digital ticketing represents roughly 15 percent of overall box office in North America.

The Chinese model, however, is not immune to scrutiny, as fellow panelist and Celluloid Junkie co-founder, J. Sperling Reich, pointed out. “How much of that growth is coming from an inflated market?” he questioned, noting that digital ticketing is a loss driver for many Chinese third-party companies, who offer tickets to consumers at a deep discount in order to gain an advantage in market share. The race-to-the-bottom approach is a risky tactic, one that won’t leave much competition when a sizable market share is achieved by one or more players. It has created an odd divide in the Chinese exhibition market, as Marcel puts it, “causing exhibitors to rent seats to third-party ticketing companies instead of selling tickets to customers.”

Fortunately, third-party ticketing stands on much firmer ground in North America. Traditionally dominated by two players, Fandango and Movietickets.com, companies like Moviepass, DealFlicks, and Atom Tickets have now joined the fray to give consumers more options. “Different third parties bring innovations,” explained Atom Tickets’ business development lead, Max Lynn, at Boxoffices Geneva panel. He was addressing the growing trend of exhibitors offering their own digital-ticketing capability through their respective websites. “Just like the airline industry, some people like to buy their tickets on Delta and others prefer to buy on Expedia.”

Leon Newnham, president of Vista Entertainment Solutions USA, echoed that sentiment on the panel. While acknowledging the value of offering ticketing through their own site, Newnham says there is a greater value in offering ticketing on as many platforms as possible. “Not all exhibitors have the budget to do everything on their own website,” he said. “Third parties allow exhibitors to benefit from their innovations.” A good example would be the scannerless mobile tickets currently offered by both Fandango and Movietickets.com, allowing employees to sight-check a consumer’s admission without having to resort to a pricy scanning device.

The New York Times recently reported that Fandango does 70 percent of its ticket sales through their mobile app, representing a gradual consumer shift that has been taking place over the last couple of years. For Ged Tarpey, head of Media & Entertainment at Twitter, that shift can help distinguish third parties from other services. According to Tarpey, around 90 percent of Twitter’s traffic comes from mobile, providing an ideal opportunity for apps such as Atom to carve their own space in the market. “That’s where the users are, and that’s why Atom Tickets makes so much sense to me.”

Atom isn’t alone in prioritizing its mobile presence; Fandango recently launched the capability to buy cinema tickets through its service via Facebook—a development first announced at CinemaCon this year. Exhibitors, however, haven’t been as up-to-date on this front. Peach Cinema chief marketing officer Malcolm MacMillan shared his frustration about exhibitors’ slow adoption rate of mobile websites. “The biggest mistake we see, regardless of the territory, is not having a mobile-sponsored website,” said MacMillan. “70 to 80 percent of your audience will find you through their phone’s browser. Your website is there to sell tickets—you need to make sure your platform is absolutely solid, works well, and is easy to use.”

That convenience and ease of use is proving to be a deciding factor on which platforms consumers will choose to buy their tickets in advance. In some cases, the convenience is so enticing that the advance-purchasing window isn’t that wide, according to Vista’s Leon Newnham. “Across the theaters that run Vista, we can see when people buy their tickets and what size group they are. Most people buy tickets about a day in advance, with the exception of tentpoles, and most come in groups of two. What we’ve seen that has surprised us is a trend of people buying their tickets online minutes before a show time. You have to ask yourself, why might that be? I suppose they walk into the movie theater without a ticket, see a line at the box office, and instead decide to buy their tickets on their phones despite the added convenience fee.”

Whether it’s as consumers or employees, catering to millennials in the industry remains a top concern. Improving the cinema experience by focusing on ease and convenience, however, is proving to be a cross-generational standard that exhibitors are meeting through the help of technology. Innovations will continue to come—and when they do, exhibitors should be ready and informed as to how they can use them to their advantage.