A week of studio presentations and discussions, as well as chatter in the halls, at the CineEurope exhibition conference in Barcelona provided some interesting takeaways about the state of cinema and its future. The mood was generally optimistic, but concerns, and room for improvement, remain.
Main talking points included the need for movie theater operators to continue upgrading and providing the best experience possible for patrons as a means to encouraging them out of the house, as well as the strength of PLF screens. A diverse and broad offering is key while there’s still concern about dating with some lulls in the schedule this year. Further, collaboration between exhibition and the studios, who refer to each other as partners but have sometimes been at loggerheads, is growing. Speculation was also rife throughout the week about the timing of Cineworld’s emergence from Chapter 11 and the composition of the exhibition giant’s management team.
Folks don’t seem to be clutching their pearls just yet about the ongoing WGA strike or a potential actors strike affecting production. One international exec told Deadline, “If the strike is over by the end of August, there will be no effect. If it runs into September, then you get worried. Most movies can still make their dates if they can get into production by the end of the summer.”
Upcoming product does look robust with Universal touting a 40-strong film slate over the next 12 months including Oppenheimer, Migration and Wicked while Disney tubthumped 17 pictures during its presentation, bringing out Kenneth Branagh for A Haunting in Venice and showing off footage from Wish replete with a live performance of one of its songs. Lionsgate talked up November’s The Hunger Games: The Ballad of Songbirds and Snakes while Sony showed footage from Bad Boys, and scenes from The Equalizer 3, Napoleon and Gran Turismo. The Warner Bros show ran two hours, highlighting Barbie and Furiosa and bringing in such talent as Zendaya and Timothée Chalamet to talk about Dune: Part Two and the Chalamet-led Wonka. Paramount treated the audience to a scene from Teenage Mutant Ninja Turtles: Mutant Mayhem and a screening of Mission: Impossible – Dead Reckoning Part One, just two days after its Rome world premiere. Even though Tom Cruise didn’t make it to Barcelona this year, he was top of mind as anticipation is high for the film and its box office potential.
In terms of box office, the first quarter of 2023 was 27% ahead of the similar period in 2022 globally. In the Europe, Middle East and Africa region, it was the most successful quarter since the start of the pandemic, with a 32% increase compared to last year, according to a report by UNIC which cited Gower Street data.
Netherlands, Austria and Norway have seen growth while Spain and Italy in May achieved results close to 2019.
Numerous UNIC audience behavior surveys across Europe show that customers, especially the younger demos, are steadily returning to cinemas and confirm cinemagoing as the preferred and most affordable out-of-home entertainment choice. The 4% increase in average ticket prices in Europe from 2021 was also driven by the growing popularity of PLFs, a sign that audiences are willing to pay more for a premium service or experience.
The UK remains a market to watch. Noted Vue International founder and CEO Tim Richards during a panel discussion that focused on post-pandemic recovery and work still to be done, “It is interesting and a little concerning sometimes when we see the UK, the biggest market in Europe, still not really performing (to) expectations. And it’s been really feast or famine, either breaking records, or we have nothing. We always have movies perform better than other movies. We have always had movies that underperformed against expectations. But it feels like this year, there’s a few films that have come out recently, great films, and you can look at them and try and be objective about it and then they don’t perform to expectations and you try to understand why. Normally, you can point a finger at something. I think that’s been a little more challenging this year. I think we have some work to do as an industry to try and sort out why a few films didn’t work. Was it the way they were promoted? Was it the content? Was it the audience?”
Andrew Cripps, Warner Bros President of International Theatrical Distribution, said, “We spend a lot of time at Warner Bros talking about the haves and the have nots. So the movies that are doing well are doing as well as they ever did, evidenced by Super Mario and a bunch of other movies. But the movies that are not performing are doing worse than they ever did… The bar is higher in terms of audiences deciding whether or not to see a movie at home or whether or not to see a movie in a movie theater. The challenge for all of us is to make sure that every visit to the cinema is a special one and an important one… the consumer has to leave with a really good quality experience not only visually and sonically but also customer service and everything that goes into that.”
As an industry, Cripps continued, “we can do better. We have to do better if we’re going to attract that audience. Clearly, there is a segment of the audience that hasn’t come back to the cinema on a regular basis. Is it because the films aren’t there to attract that segment of the audience? That’s part of it… All studios were producing fewer movies post-pandemic. We’re still catching up… There are challenges inherent in the industry to doing that at the moment. But I think you don’t have the same quality and diversity of product that we had pre-pandemic at this point in time. And hopefully that changes over time.”
For Niels Swinkels, EVP & MD, Universal Pictures International, “We were very happy last year to hit $100M on Ticket to Paradise with an older female segment that was coming back for two big movie stars. We have generally seen also relatively better performance on specialized films like Belfast last year and Mrs. Harris and Tar better than domestic relatively, and especially in Europe. But there’s no question that we need more flow of that product, and we need them to get back in the habit.”
Eddy Duquenne, CEO of Kineoplis, commented about mid-size movies, “I’m not convinced that people are saying I’m going to wait and watch that. I think it’s more a matter of awareness. And there I think as exhibitors as well, we need to learn to sell movies, and to build up a credibility that if we recommend you such a movie, which, by definition didn’t have the big marketing campaign, that we build up the trust that we have something for you that you absolutely need to watch it and see. That’s for us. There’s a lot of runway there to build up that reputation.”
Noted Cripps, “I don’t think you can ignore the fact that streamers are now starting to supply content to movie theaters as well.” On Evil Dead Rise, a movie that was made for HBO Max, Cripps noted a pivot. “That’s a movie that did $140 million around the world, and was incredibly successful. And that’s $140 million that wasn’t going to be in the in the ecosystem.” He also referenced Amazon’s Air and the late Eric Lomis, who was the head of MGM distribution, and decided the film was worthy of a theatrical release. Said Cripps, “He was right. It did $90 million around the world… I think, people are recognizing the value that having a big theatrical release brings, and I think you’re going to see more of that, which will help in terms of supply of content.”
Richards was bullish on closer collaboration with the Hollywood majors. “We all benefit with movies succeeding and I think that one of the few good things about the pandemic, or the only thing, is our relationship with studios in terms of marketing and promoting films, is really better than it’s ever been… We know our audiences better than anybody. And I think we still have a long way to go in terms of sharing that data with the studios, because we all win.”
Cripps offered, “I would say, work with us. We’ve got teams on the ground in every single country to work with this data to co-market movies, which is for all our benefits. We’re all challenged with budgets, movies are more expensive, the macro-economic situation is challenged. But if we can make those campaigns more effective, we all benefit and we bring those audiences back to cinemas.”
Swinkels concurred, “I think the biggest transformation in marketing has been exactly that, it’s the smarts. And it’s the data analytics that go beyond behind it… It is a testament to building those relationships and maintaining those relationships, because it’s essential. It’s not for any other reason than to be stronger together.”
Looking to the future, Cripps offered, “We spend a lot of time arguing about short term wins. We’ve got to focus on the long term. If the industry is missing 20% of the audience, that’s a huge number of people every year… We can’t afford to have customers come out of the cinema and say, you know what, that experience wasn’t good. So I would just encourage everyone focus on the long term. Let’s make it a better industry.”
Swinkels agreed, saying it’s essential not to just think about the weekend and the holdovers, but “about the whole year. We tend to work with exhibition on a more of a long term plan, show as much of our slate as possible, because I know it’s important for everybody’s financials to be able to have as much information to plan ahead. And then, upgrade the experience on both sides, really lean into special formats and bringing it forward.”
Speaking of PLFs, Cripps called them a “critically important part of the economic equation. We produce a lot of movies that are very conducive to premium formats, we produce a lot of big screen, big event movies. And it’s no coincidence in my mind that they’re more expensive, but they sell out faster. If you look at consumers buying advance tickets, they tend to buy, whether it’s IMAX, Screen X, 4DX, whatever the premium format is, they tend to buy those tickets first. Consumers want an experience and I think we have to continue to provide a differentiator from the home experience.”
There are “some fantastic blockbusters this summer,” said Cripps. But looking at the fall, “there’s still a gap in the release schedule. We’ve got to continue to try to provide consumers with year-round entertainment.“
Said Richards, “Once we get up to a full roster of films again, once we get up to a full selection of films, again, I’m hopeful and believe that we will get back to pre-pandemic levels. But it’s not going to happen this year. Fortunately, this year, we get a taste of it. And I think we’ve hopefully got a good summer. But we’ve got this big gap again in the autumn. We just need more films. And that’s again the time when we should be focusing on building that foundation, because there is a wall of movies coming, both local film production and from Hollywood, and we need to be there to actually make sure that everybody has the kind of amazing time that we want them to have.”
The exhibition exec is sanguine on the coming years. “I think we have a unique, probably once in a lifetime, opportunity to build a new foundation for the future. Really starting ground zero again. And we have that opportunity to do something special to create a longer term basis for the industry.”