Expectations Strong for 2010 Growth in Cinema Advertising

http://www.digitalcinemareport.com/node/1507

Submitted by Nick Dager on Thu, 01/28/2010 - 13:50.

Based on analyst forecasts and the overall strength of movies the studios have scheduled to release during the New Year, expectations for 2010 look to be positive: both ZenithOptimedia and Magna forecast that cinema will be one of the very few media categories to post gains for 2010.


The Cinema Advertising Council's most recent revenue report – independently tabulated by Miller, Kaplan, Arase & Co. – showed that total cinema advertising revenues of CAC members grew by 5.8 percent to $571,421,000 in 2008, as compared to a total of $539,946,000 in 2007. Since 2002 – the first year that cinema ad revenue was measured by the CAC – spending in this medium has increased for six consecutive years, with an average of 21.5 percent per year.  

CAC chairman and president Mike Chico says one contributing factor to the growth is that several new advertisers have tested cinema and had success and several other kinds of advertisers are returning after a hiatus. As an example, he says, "Automobiles are coming back, which is good to see."

Some of the diverse brands and categories that contributed to cinema's growth in 2009, according to reports from members, were:  Allstate, BMW, Burger King, Cadillac, Canon, Jeep, JetBlue Airways, Kmart, Kraft Foods, Levi's, NBC, Old Navy, Sherwin-Williams, Showtime, Starz, Taco Bell, Tanqueray, Visa, Volvo and Walgreens, to name a few.  Many of these brands were using cinema in 2009 for the first time.  

Chico credits last year's record box office and attendance, as well as a multi-year advertiser marketing effort, as major factors attracting brands to theatres.
 
"With a record domestic box office gross of over $10.6 billion and admissions six percent higher than they were a year earlier, 2009 was a great year for the movie business, and advertisers have taken notice," says Chico.  "CAC members have proven the power of this medium – one that grew at a higher percentage than most other sectors in 2007-08 – by bringing on clients in key categories, some of which are new to cinema.  Meanwhile, current clients have seen levels of recall, engagement and ROI that on-screen advertising and in-lobby promotions can provide, and more and more are including cinema alongside broadcast within their brands' media plans."  
 

Highlights of the biggest domestic box office year in history, based on data from Box Office Mojo and The National Association of Theatre Owners, include:

First year in history to surpass $10 billion in ticket sales
Total domestic box office increased ten percent from 2008
Domestic attendance was up six percent
Thirty different movies released in 2009 made more than $100 million each
Eight of the 12 months broke monthly box office records: January $1 billion, February $769 million, April $695 million, May $1 billion, June $1.1 billion, October $692 million, November $990 million, and December $1.1 billion
All-time highest-grossing summer: $4.3 billion

There's a reason cinema advertising continues to do well, Chico says. "Companies are proving the media with metrics. They've shown that there's a very strong recall among people who see ads on the big screen. Audiences like pre-shows and pre-shows continue to improve. People depend on it, rely on it and enjoy it."