As always, CinemaCon this year kicks off with International Day, providing a solid half day of programming dedicated to the realities of theatrical exhibition in a variety of overseas markets. This year, the Global Achievement in Exhibition Award goes to Event Cinemas, which operates in Australia, New Zealand, and Germany. Accepting the award on the chain’s behalf will be Jane Hastings, CEO of Event Cinemas’ parent company, EVT—which stands for entertainment, ventures (including property and development), and travel, the three areas in which EVT operates. In the weeks leading up to CinemaCon, Hastings spoke with Boxoffice Pro about what makes Event Cinemas unique—including its vast array of premium experiences on offer to moviegoers.
What does being part of EVT mean for the performance and operation of Event Cinemas?
All our divisions are in the business of attracting consumer discretionary spend. Our unique exposure to such diverse industries creates opportunities to take the best in class from one industry and adapt to enhance the experience across the others. Our leaders are cross-collaborating to ensure we innovate to grow faster and smarter.
As an example, when we evolve our customer journey strategies, we explore technology innovations within each industry that enable us to think outside of the square. This can apply across all touch points, from using the highly transferrable insights into the development of automated kiosks to improve the customer experience in our hotels, at our Alpine Resort, and in cinemas, to leveraging our food and beverage expertise across our 150-plus restaurants and bars to enhance our cinema dining experiences. Another key differentiator has been our ability to attract and retain talent by offering diverse career paths and great perks across each of our businesses.
For markets all around the world, the cinema industry is still in recovery mode, building back up to the numbers we had before the pandemic. In 2022, box office was AU$944 million for Australia and NZ$150 million in New Zealand—creeping up on the 2016 highs of AU$1.25 billion and NZ$201 million. What do you view as a reasonable benchmark for a successful 2023 box office? When do you think you’ll get back to 2019 levels?
The primary reason that box office has not recovered is directly related to the fact that the studios’ release slates are still rebuilding post-Covid. There is overwhelming evidence that when a good movie is released, customers want to watch it in the cinema. In the past 12 months, in Australia and New Zealand, we have had two films hit the top five films of all time: Top Gun: Maverick and Avatar: The Way of Water. In Germany and New Zealand, Avatar: The Way of Water well exceeded the first film and is now the top film of all time. The data proves that there is no doubt that customers want to get to cinemas to watch great films. Of course, it is not just about volume of films; it is also about the appeal of films to diverse audiences.
Our loyalty program, Cinebuzz, represents about 70 percent of cinema visits in our Australian [locations]. It is a powerful tool to be able to understand and connect directly and in a relevant way with the majority of our customers. We analyze customer anticipation of new films [throughout] all aspects of the cinema visit. This data shows that, post-Covid, more customers are choosing EVT premium experiences and are spending more each visit. We are also pleased to see that all customer demographics have returned to cinemas.
We are upbeat about the recovery of box office because we are confident our customers are ready, and there are more films on the release schedule from major studios than in the prior year. If the films appeal to audiences as intended, then we are going to be well on the road to recovery.
Last year, you had a massive local success story in Elvis—what’s coming up this year on the local side that you’re excited for audiences to see? Aside from local cinema, what are the 2023 titles you’re most looking forward to?
At EVT, community is one of our core values. By nature, that means that our cinemas are strong advocates of local productions and talent. At Event Cinemas we love to support Australian and New Zealand movies, as we do with Cinestar in Germany, [as well as] celebrate local talent. Movies like Elvis and Avatar: Way of Water are great examples of globally recognized releases that have incredible Australian or New Zealand talent and were (mostly) made locally.
There is a pipeline of future talent and original Australian content to be excited about, including Force of Nature, the sequel to the 2020 Australian box office success The Dry, releasing in early 2024. In New Zealand this September, celebrated director Taika Waititi will release Next Goal Wins, and in Germany, local productions typically represent about 20 to 30 percent of box office. We are starting to see the signs of the release slate normalizing.
The return of “world cinema,” with Bollywood titles like RRR and Pathaan, should encourage more diverse releases moving forward. Also, movies like [Amazon’s] Air being released theatrically elevates content that otherwise [tends to] get lost on streaming platforms.
As a fan of all movies, I am excited to see the lineup of tentpole films that are releasing between now and June, like The Super Mario Bros. Movie, Guardians of the Galaxy Vol.3, Fast X, The Little Mermaid, Transformers: Rise of the Beasts, The Flash, and Indiana Jones and the Dial of Destiny.
Premium formats and pricing have been points of discussion during the Covid recovery period—they’ve been a big draw for returning moviegoers. How does Event Cinemas provide experiences for moviegoers across different price points?
At EVT we have transformed the way we think about our cinema business. [This is] led by our premiumization strategy, which is delivering strong results, including average admit price up 21.6 percent and spend per customer up 51.9 percent on pre-Covid [numbers] for our Australian circuit.
At Event Cinemas, there is no question that movies are at the core of our experience. But by being so focused on the movie, screen, and sound, we ended up designing cinema auditoriums that all looked very similar. Almost cookie cutter, with the same seats in every original auditorium. Our premium experience, Gold Class, differentiated itself with food and beverage and luxury recliners, but it was still one version of a luxury recliner. Our large format V-Max offers an incredible audiovisual experience, but it was the same luxury seat throughout the auditorium. We identified that there was opportunity to offer a more diverse range of seating and price points.
We ran extensive customer research to test seat types, customer appetite, and the propensity to pay. The answer was overwhelmingly clear: Customers will pay more for a better seat and/or different experiences at every location. Different seat experiences and price points in an auditorium ensure we cater to all audiences. Our results prove that this is a fact.
We are now on a journey to continue to create and offer new experiences in every auditorium within every cinema location, customized to the location and audience.
Our current premium experiences include the following, and we have several new concepts in the pipeline:
- Boutique: an intimate cinema with a boutique vibe. Launched in 2019, Boutique breaks the traditional dark box cinema concept. Boutique is beautifully designed to fully immerse the audience. Each Boutique cinema has its own unique theme—anything from the red carpet to a library or art gallery—and features designer boutique recliners with footrests, service at your seat, and the best cinema sound and picture.
- Gold Class: one of the original premium cinema experiences in the industry. In 2022 we launched a new Gold Class experience featuring a choice of luxury recliners, including a couples’ privacy shroud, making guests feel like they are in their own private premium cinema with service to their seat.
- Your Cinema, Your Way: original and V-Max auditoriums that now offer three different seat experiences within a single auditorium. Each seating experience has been designed to ensure comfort, optimize sight lines, and provide an unbeatable movie-watching experience, from daybeds at the front of the cinema to recliners and a range of fixed back seats. A customer can then choose the experience that best fits their budget, from AU$20 to AU$48. The success of this concept has been overwhelming commercially, and our customer [net promoter score] averages over 45, reinforcing that customers love having the choice.
What’s the customer demand been like for your V-Max PLF screens over the last year? What’s your PLF footprint, and do you have plans to expand on it?
V-Max is one of the most recognizable PLF concepts in Australia. Demand for premium-experience admissions has increased to 30 percent of overall admissions (+12.5% of pre-Covid), and our average admission price has evidenced strong growth: +21.6 percent growth pre- versus post-pandemic (2019 vs. 2022).
V-Max currently represents around 10 percent of our total screens and is only one of several premium EVT experiences. We see great potential for premiumization across our circuits and have a growth plan to extend our premium-screen footprint, including V-Max.