In-depth: With back-to-back hits in the first quarter, are advertisers ready to roll the dice on in-cinema advertising?

The first quarter of 2022 has witnessed big hits like RRR, Pushpa, and currently KGF 2 is forcing the people to take a trip to the cinema theatres. The easing up of Covid-19 protocols and re-allowing full occupancy have helped in somewhat restoring the normalcy of the pre-Covid era. And with this, advertisers are looking forward to coming back to theatres to acquire the young audience.

It is noteworthy that regional movies such as RRR, Pushpa, and KGF 2 have done more business than mainstream Bollywood movies, although Bollywood movies like ‘Gangubai Kathiawadi’ and ‘The Kashmir Files’ were also quite profitable, leading to advertisers’ piqued interest in movies from the South. Apart from in-cinema ads, many brands have also associated themselves with South Indian celebrities as their brand ambassadors. 

Vishal Anand

Speaking on advertisers' interest, Vishal Anand, Chief Sales and Revenue Officer at INOX Leisure Limited, said, “The movie business has bounced in the first quarter of 2022. The off-take in cinema advertising has really shot up. While we are yet to achieve the pre-Covid numbers but we believe if things go smoothly like this, we will be back very soon. The conversations amongst brand and the cinema houses have started.”

While the attention span of an average user has decreased and now lingers at 5-7 seconds in the outside world, people actually sit patiently in cinema theatres while the ads are running. Thereby in-cinema ads are considered to have more impact than other mediums and, therefore, it enjoys a standardised ad rate. 

Dhirender Suri

Talking about the effect on ad rates due to hit movies in 2022, Dhirender Suri, Head of Product – Cinema, iTV (GroupM), said, “Ad revenues have grown as compared to 2021. In fact, if we compare 2019 OND box office numbers, we see a 10% increase in box office collection in 2021. In 2022 from Mid-February, things started to pick up and in the month of March 2022, cinema witnessed massive footfalls which were mainly due to big tickets releases. This has led to an interest in advertising with the advertising rates being comparable to pre-Covid rates.”

However, INOX’s Anand said that it won’t be a good idea to increase the ad rates right now. He said, “It is a very conscious call not to increase the rate as the industry is trying to get back to pre-Covid numbers. Our rates have not changed since 2021.”

The ad revenue contributes around 11-12% of the business in the post-Covid era whereas it used to contribute around 14-15% before the pandemic, 25-35% comes from food and beverages, and the rest 60-65% is contributed by box office collection.

As the industry is positive that they will beat the pre-Covid numbers if people keep coming to the big screens in huge numbers, many new-age brands and first-time advertisers are keen on rolling the dice on in-cinema advertising.

Siddharth Bhardwaj

Siddharth Bhardwaj, CMO and National Sales Head - Enterprise, said, “A very large percentage of the cinema-going audience is young and affluent, hence brands that target this audience are attracted the most to the cinema. Brands with high brand saliency and awareness invest in cinema advertising to increase brand love and brand consideration scores.”

Similarly, INOX’s Anand said, “There are many first-time advertisers we are getting associated with. All the new-age companies, start-ups, companies in the category of Fin-tech, health-tech have shown key interest rather than our traditional old clients like luxury brands or brands from the FMCG sector.”

Bhardwaj also said that there has been a shift in consumer preference when it comes to regional or dubbed versions of movies. As per him, the consumers of today want larger than life movies even if they are dubbed, which clearly defines a behavioural shift in content consumption. 

In order to woo the advertisers with the new age technology and more options to effectively reach out to the consumers, cinema houses are constantly innovating. Web-based AR, and online gaming is gaining some traction, followed by live match screenings which are being experimented with by theatres. There are different packages that the houses are offering to the advertisers, such as cost-per-contact deal, fixed deals, cost-per-audience etc.

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