Promoting the Pre-Show: Cinema Advertising in 2019

Hilary Swank with Screenvision CEO John Partilla at the Company's 2019 Upfront Event in NYC

Another record year at the box office once again led to a strong year for cinema-advertising companies. According to the Cinema Advertising Council (CAC), the sector’s national nonprofit trade association, revenue among the organization’s members reached a total of $781.1 million in 2018, crossing the $750 million mark for the third consecutive year. The CAC figures include all forms of advertising within a cinema in their analysis, yet the category is clearly dominated by on-screen advertisers—who claimed nearly $700 million of that figure last year. 

“2018 was another record year for us,” confirms John Partilla, CEO of Screenvision, citing it as the company’s fourth consecutive year of record revenues. Similar sentiments were shared by the three other companies interviewed for this article: Before the Movie, National CineMedia (NCM), and Spotlight Cinema Networks—all of whom report a significant boom on the back of a robust box office. 

That momentum wasn’t limited to the strength of summer blockbusters alone. Spotlight Cinema Networks, which specializes in a national network of art house and luxury theaters, earned record revenues in the latter half of the year according to its president, Michael Sakin. Specialty programming of award contenders from major studios like Fox’s Bohemian Rhapsody ($216.8 million) and Warner Bros.’ A Star Is Born ($215.2 million) released in the fourth quarter helped drive adult audiences—and advertisers—throughout the holiday season. 

Business was just as good for Before the Movie, which focuses on crafting customized pre-shows for independent exhibitors. The company’s CEO, Corey Tocchini, reveals that his company registered record earnings from local advertising—a particular strong suit for the organization. According to the CAC’s annual statistics, local ads only represent a small stake of all cinema-advertising revenue. The bulk of the grosses come through national and regional accounts, which are responsible for 89.5 percent of the sector’s overall business. National and regional sales also experienced a boost, increasing by 5.4 percent against 2017. 

“2018 was a great year for us,” says NCM’s Cliff Marks, who was named the company’s president last May. “Not only did we see revenue growth across all our businesses—national and regional—we also saw the emergence of our digital division.” That digital division has helped bring NCM’s advertising reach outside the cinema screens and onto viewers’ mobile phones through interactive games like Noovie Arcade and Noovie Shuffle. “It allows us to communicate with consumers when they’re at home, when they’re sitting in an airport waiting to board their flight. Our vision is to create an immersive array of products that allows us to engage with movie audiences wherever, whether it’s through games like Fantasy Movie League, Noovie Shuffle, or Name that Movie, a promotion in the lobby of our theaters, or a 3-D ad on the big screen.”

Before the Movie has made similar inroads into consumers’ mobile phones with its stake in Fuze Viewer, an augmented-reality (AR) app, which can be activated to produce effort-free lobby experiences on the part of the exhibitor.

Despite these technological advances, companies like Spotlight Cinema Networks insist that they’re not part of a general plug-and-play strategy that works for all exhibitors across the board. “It depends on the nature of your network,” explains Sakin. “For the segment that’s looking to market itself to the general public—teenagers and younger audiences—artificial intelligence, interactivity, and gaming are definitely ways to go to embrace that 12 to 24 demographic. If you focus on the 21- to 49-year-olds like we do, it’s all about the content and quality of the pre-show. Exhibitors have spent a lot of time and money in creating high-end environments for their customers, and we need to equal that experience with our pre-show. We can’t divert from that experience with an interactive pre-show or anything else that is too over the top or overbearing.” 

Spotlight prides itself on its highly customizable pre-show, which can feature short films, movie content, or even extended running times for premium ads. “We have luxury travel and fashion partners who have aired five-to-ten-minute shorts on our screens,” says Sakin. “We are always willing to customize the experience as long as it’s more entertaining for the consumer.”

Screenvision has also taken an innovative approach to its pre-show this year. The company recently announced a partnership with the Geena Davis Institute on Gender in Media to feature and promote films with a favorable GD-IQ rating in its pre-show, a metric used by the institute to identify films with gender-balanced portrayals. Additionally, Screenvision will be participating in the Association of National Advertisers’ #SeeHer Gender Equality Measure (GEM), a certification used to identify ads with a realistic portrayal of girls and women. “It’s something that we are really proud of,” says Christine Martino, EVP of national sales. Screenvision is planning to create a title package around GEM-certified titles, where #SeeHer advertisers can attach their own GEM-certified ads. 

Initiatives like these have helped the cinema-advertising sector stand out as a dynamic and innovative platform in today’s media market. “We’re beginning to get clients that hadn’t considered cinema in the past,” adds Martino. “About half of our audience watches light to no TV; the first place you’re going to be able to reach those consumers is at the movies. The leading streaming services and OTT services are not ad supported, so if you’re looking to reach consumers with premium video, cinema is the one destination that can still deliver.”

Cinema advertising has therefore emerged as an ideal platform for premium video advertising in an era when these platforms can be hard to find. The CAC reports that a total of 185 new brands entered cinema advertising in 2018. The council cites last year’s top five cinema sales categories as: telecommunication, internet, and media; automotive; insurance and real estate; entertainment; and consumer electronics. 

Each company surveyed in this piece shared its own unique growth drivers. Before the Movie, for example, reported increases in advertisers from the health care, hospitality, and solar industries. A network with a more mature demographic like Spotlight Cinema Networks reported alcohol as a consistent performer. “We have adult audiences who come to our theaters looking for a date night or evening out, and we’re uniquely positioned to appeal to those consumers,” says Sakin. 

The key for continued growth in cinema advertising lies in the power of data analytics. “NCM is, first and foremost, a media company,” says Marks. “The brands we’re working with are making decisions about where they spend their marketing dollars. Do they put them in Google, Facebook, Snapchat, Amazon, or do they put them in cinema? For cinema advertising companies to be most competitive as media entities, we must be able to be as accountable and attributable as other media players. We need to be competitive, and if we can’t garner good first- or second-party data, we’re not going to be able to be competitive with the media industry, television, digital, and social. The revenue we bring to the exhibition community will go down if we cannot be as competitive with the digital media industry as we need to be. For us, data is critical to be a modern media company that can tell brands what we’re doing with their money and how we can help them drive more sales.”

“Addressable advertising is our biggest challenge right now,” agrees Spotlight’s Sakin. “Advertisers are making a considerable investment in creative and media, and they want to know they are getting the right eyeballs. Cinema advertising’s challenge is going to be how we answer this addressability question.”

It’s a challenge that every company in the space is actively working on, whether it’s through first-party data or second-party channels. The future of cinema advertising will rely on the insights advertisers can draw from moviegoing audiences—and their ability to refine their targeting and re-targeting campaigns. Cinema, after all, offers an increasingly elusive proposition for advertisers: a captive audience. 

“We are all part of a great industry,” says Tocchini. “As long as Hollywood keeps telling great stories, people will flock to cineplexes, and brands will want to be a part of that experience. [Cinema advertising] just needs to deliver to exhibitors, brands, and moviegoers alike: keep it interesting, keep it relevant, keep it simple, and we will all be successful.”

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