As the population of the UAE soars and residents benefit from the region’s economic boom, cinemas have seen audience numbers jump.
In the past few years, the rate of movie attendance in the UAE has grown by double digits every year, despite the fact that in the rest of the world cinema audiences have been static.
This growing captive audience is a huge draw for advertisers.
Emirates Business sat down with Motivate Publishing Group Sales and Marketing General Manager Liam Marshall, who used to head Motivate Val Morgan Cinema Advertising, and Motivate Val Morgan Cinema Advertising General Manager Avinash Udeshi – who oversees an exclusive advertising sales agreement with CineStar, one of the UAE’s top two cinema operators – to discuss the trend of growing audiences and its effect on cinema advertisement.
How did advertising in cinemas in the UAE grow in 2007?
LM: To answer this question objectively, we have to base this on performance of previous years.
On a year-to-year basis, we had phenomenal growth. We had a 36 per cent increase in sales volume in 2007.
We are the people who sell advertising at the cinemas. Let’s put it this way, in 2006-2007, it was a huge year for us in terms of revenues. For 2005-2006, it was a good year, where we had 20 to 25 per cent growth.
This is while the number of cinemas and screens has been increasing in the UAE.
When did the upward trend in cinema attendance and advertising really take off in the UAE?
LM: It was in September 2005 when the cinema at the Mall of the Emirates opened.
By 2007, it was the number one cinema in the UAE according to our sources.
Cinemas in the UAE have been run by two major operators – CineStar and Grand.
Do you think more competitors will enter the market given the movie watching boom in the UAE?
LM: That used to be true but not anymore. A new world-class operator is expected to enter the UAE cinema market and it will take part in the cinema launch at the new Dubai Mall.
Also, an independent operator, MM Kabeer, who has been in the cinema business for years in the UAE, has plans to expand and open new screens at cinemas in Al Ain and Al Raha Mall in Abu Dhabi.
So would you characterise advertising at the cinema as a major distribution source for advertising agencies in the UAE?
LM: Cinema will never bring in the same revenue as other outlets.
Cinemas only make up between one to three per cent from the total media spending on advertising worldwide and cannot go beyond that.
Even if audiences are increasing, it will remain a niche medium, not a mass medium.
You will only have growth to a particular level, plus we take only 10 minutes for advertising [before the movie starts] and this is how we ensure consumers have less clutter and greater quality of advertising. So we will not have exponential growth.
Cinemas are a regional medium, but television is definitely a mass medium.
What advantage does cinema advertising have over other mediums?
AU: In cinemas, money waste is minimal, while in other mediums more money is being wasted every day.
What are your cinema advertising expectations for 2008 in terms of revenues and audience attendance?
LM: For audiences, the operators can let you know better.
But I can tell you that with the way economy is booming in the UAE, audiences will grow in double-digit figures. For revenues, we expect 25 per cent growth.
Which sectors give cinema advertising more attention than others in the UAE?
AU: It depends on how educated and informed consumers and advertisers are.
We have a variety of cross sections. There are automobile, telecoms, chocolate, fashion, sports ads, you name it.
But mobile phones, automobiles and telecommunications are the sectors that advertise most.
Cinemas never used to be a major focus for advertisers, how are things changing?
AU: Over the past three years things have been changing.
You now find cinemas on most media plans for the year. Now, they are an integral part of advertising plans and strategies.
There has been a constant sense of education about this. Five years ago, advertisers used to say the summer was a down time, but summer is a peak now.
The big blockbuster movies are in the summer, which is one of our highest revenue periods in terms of audiences and sales.
Everybody likes cinemas and since it is a small market, people are very well informed. The audience is increasing by double-digit figures every single year in the UAE.
That is different from most countries in the world where cinema growth has been static. As the population increases, the more cinemas to have to offer.
What challenges has cinema advertising been facing in the UAE?
LM: If you want to run something at cinemas, you need content that is very important. Because when you shoot a commercial, it can be anywhere from Dh275,400 all the way to Dh1.8 million or Dh3.6m.
There has to be a commercial that is shot and then you have to convert it to 35mm to put it on cinema and these have been ongoing challenges.
Beside the conversion of TV material to cinema material, we are also looking at going digital where we will be converting a lot of our cinemas from 35mm to actual digital projection.
The whole advertising reel will be digitally projected. Once you have digital material, we send it by satellite to each one of our cinemas.
Is there a difference between cinemas in the UAE and the GCC?
AU: Yes. First, people in the UAE are more receptive to watching content from Bollywood and Hollywood.
Second, cinemas in the UAE are very luxurious, with the latest technology and creature comforts on offer.
Third, there is also a difference in the way the UAE Government operates, which makes all sectors including cinema different and better.
They let people in a lot easier than other Middle Eastern countries.
Most of world’s movie production comes to the UAE from Bollywood, Hollywood and Arab movie productions.
Who is the quickest in terms of delivery?
AU: Bollywood is the fastest, and the movie arrives in the UAE one day before its release in India.
Hollywood can be simultaneously the same day but maximum two weeks. For Arab movies, it can take up to a month to two months, but it could be faster.
Why do independent films face more challenges in terms of showing at mainstream commercially oriented cinemas?
AU: It has to do with the distribution and distributors.
The cinema exhibitors have no control over what they show because they buy movies from distributors and they buy only what they think may work and go well.
Also, what happens here is that the distributors release the movie across cinema operators simultaneously, so unlike the United Kingdom, where you have to travel a certain distance to see that particular movie, here all the movies are released on the same day.
This makes it easy to watch the movie at a cinema that is most convenient to you.
Plus the gap between releasing the movie in the US and its arrival here is around a week to two weeks. Generally we get movies in reasonable time.
Where do you see cinemas’ popularity in the UAE in the next five years and how would you evaluate this sector’s growth rate compared to other media outlets?
LM: There is a chance now for cinema advertising to grow by three to five per cent from the total advertising spent.
We believe that other media will slow down and cinema advertising will continue to grow.
Look at the clutter on Sheikh Zayed Road, what guarantees do you have that these advertising boards will be looked at?
With cinema advertising, you have a captive audience and we only run ads for 10 minutes.
The UAE will grow in all sectors, but I believe cinemas’ average growth annually will be above other media outlets.
Will there be new cinemas launched in the UAE within the next three years?
AU: Yes. There will be new cinemas in Dubai Festival City, Dubai Mall, Uptown Mirdiff, Dubai Marina and one at the new Mall of Arabia. In addition, current cinemas in Al Raha Mall in Abu Dhabi will be expanded and new screens added.
There have been rumours that new cinemas will be built at Al Wahda Mall in Abu Dhabi and Ajman City Center, but this has not been confirmed.
What kind of market research do cinemas provide advertisers?
AU: When it comes to research, cinemas are the best when it comes to audited ticket sales.
You have the exact number of people going to cinemas and which screens they go to. If cinemas provide their research studies and statistics, they will be the most reflective, most accurate and most precise.
Do certain advertisers demand auditing reports before agreeing to buy ads?
LM: There is a complete fallacy about this. Advertising agencies will tell you that they only advertise with audited mediums.
I believe it is about 60:40 split where 60 per cent of those advertisers advertise in audited mediums and the other 40 per cent still advertise in non-audited mediums.
During his 20-year career, Liam Marshall, Group Sales and Marketing General Manager, Motivate Publishing Group, has held a number of media-related positions.
The South African has worked in marketing for his home country’s largest television station and managed a cinema advertising company for four years.
For the past six year Marshall has been in Dubai with Motivate, before which he headed Motivate Val Morgan for Cinema Advertising.
Avinash Udeshi is the general manager for Motivate Val Morgan Cinema Advertising.
He came to the UAE from India, where he worked for Corporate Accounts of India Today Group and he has been with Motivate Val Morgan for Cinema Advertising for seven years.