59. Multiplexes

Jinesh Jayprakash Vasa – MMS-A (2008-2010) Roll number : 59 022-28985049; +91-9769683830; [email protected]

Market Analysis Multiplexes Jinesh J. Vasa MMS A – 2008 -2010. Roll Number 59. This report deals with the analysis and study of Multiplexes as a part of Indian Film Industry and the Top 5 Multiplexes.

K.J.Somaiya Institute of Management Studies and Research

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Jinesh Jayprakash Vasa – MMS-A (2008-2010) Roll number : 59 022-28985049; +91-9769683830; [email protected]

The Film Exhibition Industry – MULLTIPLEX

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Jinesh Jayprakash Vasa – MMS-A (2008-2010) Roll number : 59 022-28985049; +91-9769683830; [email protected]

INDEX Sr.

Topic

Page

1.

Introduction

4–5

2.

Multiplexes vs Single Screens

6–8

3.

SWOT Analysis 3.1. Strengths 3.2. Weakness 3.3. Opportunities 3.4. Threats

9 – 11

4.

PEST Analysis 4.1. Political 4.2. Environment 4.3. Social 4.4. Technological

12 – 13

5.

Marketing Mix Concept 5.1. Product 5.2. Promotion 5.3. Place 5.4. Price

14 – 15

6.

Marketing Communications Mix 6.1. Advertising 6.2. Publicity

16

7.

Comparative analysis of top 5 multiplexes

17 – 18

8.

Individual Brands (Multiplexes) at Glance 8.1. ADLABS Films 8.2. INOX Cinemas 8.3. PVR Cinemas 8.4. CINEMAX Cinemas 8.5. FAME Cinemas

19 – 29

9.

Conclusion

30

10.

Recommendations

31 – 33

11.

Bibliography

34

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Jinesh Jayprakash Vasa – MMS-A (2008-2010) Roll number : 59 022-28985049; +91-9769683830; [email protected]

1. Introduction 1.1.

Film Industry Chain

The making of a movie forms a chain from conceptualisation to sale:

Concept This is where a person comes up with the idea, researches the audience, the target market etc. These include script writing, budgeting, preproduction planning, performers and others.

Distribution This is where the person packages his idea, audience research and the team into an attractive package and sells the idea to the distributors. They in turn give him undertakings that give him an idea of how much money the film will make.

Financing This is where money is raised on the basis of the undertakings that have been given by the distributors.

Manufacture Now the film can be made keeping in mind the quality expectations of the distributors. This includes the production and post-production phases.

Selling Now the completed film is delivered to the distributors and marketed to the audiences that targeted in the first place. It includes cinema, television, video stores, and internet/DVD.

Marketing is undertaken at every step of this chain. From the time the story is thought and the cast is selected, the marketing process begins. Directly or indirectly, the news that is spread about the movie tells the customers about it thus promoting the movie. 4|Page

Jinesh Jayprakash Vasa – MMS-A (2008-2010) Roll number : 59 022-28985049; +91-9769683830; [email protected]

Marketing teams consist of strategists, negotiators, publicists, photographers, graphic designers, sales reps, writers, media producers and announcers, editors, and many more specialists who move the product from a script through the industry system into the consumer system. Marketing a movie involves a roll-out calendar that first reaches out to industry channels: distributors, theatrical exhibitors, sales reps, producers’ reps, and the industry media. In the value chain of film making, Production, Distribution and Exhibition are the three key segments, of which, the distributor is the key stake holder. It includes distribution to the theatres, to homes through VCD, DVD, and satellite. We will concentrate on distribution through Theatres/Multiplexes in the report below.

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Jinesh Jayprakash Vasa – MMS-A (2008-2010) Roll number : 59 022-28985049; +91-9769683830; [email protected]

2. Multiplexes vs Single screens With multiplex industry’s soaring business and ominous presence, can the single screen cinema halls sustain its business? Single screen theatres and talkies in the city are a passé now. They are inconspicuously disappearing into oblivion in the wake of rampant multiplex culture. Besides the government ordinance which ensures a complete entertainment tax waiver and concessions to multiplexes, the populace audience also has deserted the single screens. The nature of multiplex entertainment, which offers video arcades, bowling alleys and pool parlours spiced up with their lavish and multi-cuisine food courts, does ensure that the audience is lured towards its glitterati. With multiplexes came the multiplex style of management: plush seats, superior sound quality, add-ons - all at a price, of course. Consumerism has always existed. Today multiplexes are offering better facilities to a section of the audience that can afford it. The Indian film industry is one of the largest in the world — producing 1041 films, annually. It is currently worth about US$ 1.8 billion and is expected to grow at a CAGR of 16 per cent for the next 5 years to reach US$ 3.8 billion in 2011. Bollywood, the Hindi film industry, which commands a 40 per cent share of the Indian film market, is gaining a global audience. A spurt in the number of multiplexes in the country has changed the entire complexion of Indian films — their budgets, the way they are made and the audiences they are made for. Multiplexes have played a pivotal role in these developments, catering to a global taste, says Mr. Alok Tandon, CEO of INOX. “People with higher disposable income prefer the multiplex catering. 65% of operational cost in a Multiplex is pertained to electricity cost the rest is staff salaries and ancillaries. I see Multiplex culture is not only in Mumbai but all over India. They offer better choices of films to the consumer outlet for small media products to be screened,” says Shravan Shroff, Director Fame Adlabs. Across the country, single-screens are being taken over and converted into multiplexes. Here’s a stunning stat: the total number of screens in India actually declined by nearly 20 % from 2000, even as the number of multiplex screens surged by a whopping 1300% in the same period. “Yes multiplexes are a growing trend in Mumbai. This will be to the advantage of the customer making it a buyer’s market. Populated neighbourhoods will see the rise of multiplexes and this will overcome the problem of fewer cinemas and longer travel times to visit them. This will also help increase the distribution network of films brings it to a larger audience thereby improving the overall collections per film. Multiplexes will also open the market for small budget and international films which can be showcased to a select audience. This is surely revenue making proposition,” Pooja Shetty, Director, IMAX Adlabs Dome Theatre and Multiplex.

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Jinesh Jayprakash Vasa – MMS-A (2008-2010) Roll number : 59 022-28985049; +91-9769683830; [email protected]

The rationale for tax waiver was explained and a statement was appended to the government notification. The statement reads as follows, “Public at large these days prefer to see movies at home. Keeping in view this scenario, a concept of complete family entertainment centre has emerged, popularly known as a multiplex. However, these multiplexes are highly capital intensive, their gestation period is also longer and therefore, need government support and incentive.” “The tax waiver is going to kill us,” laments Vikram Chavan, Vice-president of the Pune Exhibitors Association (PEA). Couple that with the nature of multiplex entertainment, which offers video arcades, bowling alleys and pool parlours, and distributors may well forget that single screen theatres exist,” he adds. The notification states that a multiplex has the option of exit after ten years. This is not allowed for single screen theatres, even if the whole thing is running at a total loss and should a single screen theatre owner decide to convert the premise into a commercial complex, there is a condition that a mini-theatre must be a part of the new structure. “All the incentives has not only given a boost to the burgeoning multiplex industry, but the fringe benefits like parlours and food courts, that the lies at the core of multiplex entertainment has been successful in ably attracting the audience. As a result the single screen theatre industry, which has quality movie and action as their centripetal guiding force, has been dying a slow and painstaking death. There are very few loyalists who actually are willing to purchase tickets and visit the single screen theatres, but otherwise the majority doesn’t mind spending unreasonable amounts that these multiplexes charge,” says Mr. Mohan Tapare, Manager Vasant theatre, Pune. Veteran film exhibitor Manoj Desai and Executive Director of the Gaiety-Galaxy multiplex as well as the legendary Maratha Mandir theatre, says, “The multiplex industry is a profitable one and it is natural that the entrepreneurs will dive into it. But what is disheartening is that under the pretext of the entertainment, they are selling other amenities like food courts, lounge styles and pools. The core of these multiplexes is not quality entertainment, but hollow facilities and it is really sad that people are willing to pay astronomical prices and abandoning theatres and drama for these bromides. The current status of single screen theatre is really concerning.” In India, there are only 12 screens per million population compared to 117 screens per million in the US and more than 40 screens per million for European countries. “We will be left with b and c grade films and this will further deplete an already decreasing audience,” states Mr. Mohan Tapare. Theatre owners are not allowed to change the nature of their business unless they retain 33 per cent of the original number of seats in their new enterprise. Further, the government has not considered the fact that not everyone can afford to watch a film in a multiplex considering the high rates of admission. This will only promote a backdoor boost to video piracy.

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Jinesh Jayprakash Vasa – MMS-A (2008-2010) Roll number : 59 022-28985049; +91-9769683830; [email protected]

Many city theatres have shut shop in the last few years. Some prominent theatres on the death list include Ganesh in Lalbaug, Satyam, Sachinam and Sundaram in Worli, Milap in Kandivli, Milan in Santa Cruz and Sangeeta in Malad. Five more cinema halls are on their way out. Kohinoor at Dadar and Topiwala at Goregaon too have fallen in this contest. Steep taxes, film piracy, a recalcitrant audience and mushrooming multiplexes are spelling its doom on single screens. The state government’s steep entertainment and property taxes are the main scourges for exhibitors, said Nester D’Souza, the CEO of Metro theatre. Over the past five years, 49 single screen cinemas in Mumbai and the suburbs have downed shutters. Apsara at Grant Road and Metro at Marine Lines are among those that have been converted into multiplexes. Mr. Manoj Desai, says “Earlier, a theatre owner in south Mumbai paid Rs 50,000 as property tax, while he now shells out Rs 5 lakh. Theatre owners also pay other taxes: 12 per cent for education tax, 15 per cent for road tax, while one per cent of weekly box office collections go to the government-owned Films Division.” Whatever be the reason, the popular choice or the government incentives for multiplexes, the fact that the single screens are deserted is glaringly evident and looks as if soon these single screens will be a matter of history. Q.1. Single Screens or Multiplex? (Survey conducted across people of various age and gender in Metros)

Preference

Single 12%

Either 5%

Multiplex 88%

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Jinesh Jayprakash Vasa – MMS-A A (2008-2010) (2008 Roll number : 59 022-28985049; +91-9769683830; [email protected]

3. SWOT ANALYSIS For developing a sound strategic plan for the film industry mainly for the marketing and brand recognition, first a detailed analysis is required to be done. For this reason, a SWOT analysis of the Indian same is done below:

INTERNAL ENVIRONMENT

3.1.

Strengths

3.1.1

Size:

EXTERNAL ENVIRONMENT

Strenghts

Oppurtunities

Weakness

Threats

The Indian film industry is one of the largest in the world — producing 1041 films, annually. It is currently worth about US$ 1.8 billion and is expected to grow at a CAGR of 16 per cent for the next 5 years to reach US$ 3.8 billion in 2011. Bollywood, the Hindi film industry, which commands a 40 per cent share of the Indian film market, is gaining a global audience. 3.1.2. Government Help: The Government in India is keen to sustain this growth and has positioned itself as a proactive facilitator positioning ng India as a 'hub' for the 21st century. It is removing barriers to foreign investment, fast tracking procedures and introducing legislation to control piracy and under-declaration. declaration. It has granted the film sector 'industry' status and has introduced 'clean 'clea money' through state controlled banks. 3.1.3. Tax Incentives: Government has started to use regional and national tax incentives for improving and building the production and exhibition infrastructure and to improve investment in content 9|Page

Jinesh Jayprakash Vasa – MMS-A (2008-2010) Roll number : 59 022-28985049; +91-9769683830; [email protected]

creation and human capital. According to a government ordinance, the multiplexes need not pay any Entertainment Tax for three years and then only 25 per cent for the next five.

3.2.

Weaknesses

3.2.1. Quality of films: The number of movies produced in India is far more than those produced by Hollywood but the investment per film is fairly low and better quality movies are needed with more investment. 3.2.2. Dependence on Box Office Sales mainly: Various new areas for revenue generation like DVD, video sales, video rentals are still not explored. Most of them depend only on box office sales. Also holiday seasons play an important role; otherwise the turnout for an average movie is less. 3.2.3. Indian Diaspora: Indian movies look only at audiences in the Indian Diaspora, even the audience abroad should be viewed with the same importance. 3.2.4. Ticket Prices The ticket prices play an important role. If the ticket prices are really high, then the number of viewers will be less then otherwise.

3.3.

Opportunities

3.3.1. Foreign Capital Investment: 10 | P a g e

Jinesh Jayprakash Vasa – MMS-A (2008-2010) Roll number : 59 022-28985049; +91-9769683830; [email protected]

There are opportunities for foreign capital investment in projects, production houses, film studios and film facilities, especially post-production, distribution and exhibition. 3.3.2. Funds from Non-Resident Indians: There are opportunities for Non-Resident Indians to become equity investors in the Rupee Fund being discussed by the Federation of Indian Chambers of Commerce and Industry (FICCI), the Confederation of Indian Industry (CII) and investment bank Ambit. Through the fund, individuals will be able to buy shares in the major film and television companies, invest in projects for profit and in education and training institutions for philanthropic reasons. 3.3.3. Corporatisation: Speeding up of the move towards corporatisation would result in good movies made in record time with discipline and professionalism. Also the ambience will improve a lot. 3.3.4. Tax Incentives to Multiplexes: The tax incentives to multiplexes are a good opportunity to attract audiences of all class to watch movie having a special experience.

3.4.

Threats

3.4.1. Threat of Rivalry: Movies are released on a yearly basis on a large scale and number. Each movie has to acquire a special position in the minds of the audiences. They need to stand out with their unique methods to promote the movie and with the unique theme of the movie. Also the location of the multiplex plays an important role. 3.4.2. Threat of Substitutes: Also there is an enormous threat from the other industries of the entertainment sector viz.: TV, Radio, Stage plays (theatre), et al. Demand and popularity for TV serials is increasing day by day. Soon DTH will be the most important threat for the same and it will suffers enormously”. 3.4.3. Threat of Buyers: Movie audience is becoming more and more aware. They understand what a good movie is. People are paying more attention to the buzz created for the movie.

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Jinesh Jayprakash Vasa – MMS-A A (2008-2010) (2008 Roll number : 59 022-28985049; +91-9769683830; [email protected]

4. Pest Analysis To understand how this service affects the environment and how it is affected by the environment, it is necessary to do a PEST analysis. Below picture shows the same.

PEST • Political • Enviornmental • Social • Technological

4.1.

Political

Given iven the fast pace of its spread, its acumen towards cinema of diverse kinds and a long gestation period, central and state governments are encouraging major investment and offering sops to investors and developers who comprise real estate entities, film exhibitors e and distributors, film processing companies and media conglomerates. But the concessions are accompanied with conditionality aimed to prevent concentration of multiplexes in select regions and in some cases to promote regional cinema. A microcosm of retail culture including significant portions of global brand names, the multiplex site makes for the kind of up-beat beat location that coincides with government attempts to alter conventional images and all that compliments the bandwagon. It also enables foreign tourists to access cinema. The Indian film exhibition sector is highly regulated and changes in regulations may have an adverse effect on business. Provisions of laws include: – Requiring a minimum distance between the screen and the front row seats, which distances were set based on large screens used in single screen cinemas and not the smaller screens used at most Multiplex Cinemas. – The permissible pressure at which the electrical current may be supplied to a projector, which provision does not reflect r the technological advances in respect of Multiplex Cinemas. – The reservation of playing times for a scientific film, educational film, news reel or documentary. – Restrictions on ticket prices in certain states

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Jinesh Jayprakash Vasa – MMS-A (2008-2010) Roll number : 59 022-28985049; +91-9769683830; [email protected]

4.2.

Environmental

Upon introduction of liberalization, retail chains emerged and expanded as the momentum of consumerism slowly rose. Consequently, retail spaces steadily gained premium over commercial ones. Strategies to cover costs had to be revised. While rethinking products, prices and efficiency, retailers linked promotions, fun and entertainment to penetrate bigger chunks of the market and secure customer loyalty through customization. In a climate of alliances and add-ons like food joints, the concept of holistic family entertainment experiences gained patronage. In such a scenario, the immensely popular leisure activity far older than television in India – cinema – suffering from inadequate exhibition facilities intersected with aggressive retailing and helped prompt the multiplex. This served to revive the diminishing cinema going habit by enticing audiences away from their television sets, with their clutter of imagery from all over the world drawing upon the cable and satellite boom. The desire for the image is now combined with other leisure activities and occupations.

4.3.

Social

The multiplex is preceded by and concurrent with a tradition in parallel cinema that reached a peak in the 1970s. More recently a trend in rethinking, innovative cinema has gained prominence for confronting pressing social issues like feudalism, sexuality, terrorism and separatist movements within the scale of mainstream films. These films occupy the space between the mainstream and art film, reaching audiences without the essential melodrama typical of Bollywood films in which characters are fore grounded, on occasions distanced, from their milieu. They have gained critical acclaim at home and abroad alongside box office endorsement. While the attraction of some can be located in the dynamics of stardom and a heady mix of song and dance, all interrelate the audience through commonplace situations, traumas and experiences.

4.4

Technological

As a space commanding flexibility and an ease with manoeuvrability, the multiplex, concurrent as it is with the digital revolution, could even aid in the promotion of the format. Not simply by providing accompanying exhibition facilities like digital projection or digital sound, but by making available alternative display spaces for digital films that bear potential as a distinct genre. With the conveniences of its apparatuses, film form is already witnessing alteration in some parts of the world, and filmmakers without access to elaborate film equipment have received a fillip from this technology. New territories in relation to content are being explored by a breed of filmmakers who are exploiting the ease of accessibility accompanying the medium. Redefining film form and content, digital films could prompt and occupy viewing spaces as differing from conventional films and embody forms like the ‘walk through’ film that may require simultaneous projection on more than one screen, not necessarily of conventional theatre size. So if technology advancement is not kept in mind, it can badly hinder the future growth of the industry.

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Jinesh Jayprakash Vasa – MMS-A (2008-2010) Roll number : 59 022-28985049; +91-9769683830; [email protected]

5. Marketing Mix A combination of marketing elements used in the sale of a particular product, the marketing mix is centred on combining elements of the 4 P’s of marketing: product, price, place, and promotion. “Marketing attitude” behind each of these critical elements of engaging people in the exchange of entertainment and enlightenment for the greenback is discussed below.

5.1.

Product:

Production value is a nice global term in product marketing at multiplexes. Included in this catch-all basket are:


Location




Ticket Rates and Show timings




Visual, Sound and Music quality




Deliverability: quality, on-budget, on-time and marketing materials

5.2.

Promotion:

This part of the marketing mix is the most important in determining whether a person will want to watch a film in a multiplex or not. For most movies aimed at a mass audience the opening weekend is crucial to its box office performance, if it does not open well (Friday to Sunday) then it is likely to be a flop. Therefore most of film promotion is designed to open a movie big and then hope that positive word of mouth will kick in afterwards.

5.3.

Pricing:

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Jinesh Jayprakash Vasa – MMS-A (2008-2010) Roll number : 59 022-28985049; +91-9769683830; [email protected]

The main aim for the multiplex is that more and more audience watch the film in the multiplex. But if the price of the tickets and additional charges (like parking, snacks, games) are not kept under control it might act as a repellent for the audiences. Also, with the rising demand for VCDs and DVDs and also the piracy, manufacturers are bringing down the prices too. Standard Ticket Rates for various multiplexes are: Shows

Afternoon (Rs.)

Evening (Rs.)

Night (Rs.)

Weekdays (Except first Friday of 60 - 80 movie release)

80 - 120

100 - 150

120 - 180

1st Friday of movie release (Awaited 80-100 Movie)

100 - 140

150 - 180

160 - 250

Weekends and Holidays

100 - 140

120 - 180

120 - 250

5.4.

Morning (Rs.)

70 - 90

Place:

India's multiplex bandwagon has gone beyond the metros to redefine entertainment in B and C class towns. "While the first phase (of the multiplex story) saw emergence of multiplexes in metros and now this growth is spreading to Tier 2 and 3 cities like Lucknow, Indore, Nasik, Aurangabad, Kanpur, Amritsar and so on," says Ajay Bijli, managing director, PVR Cinemas. And PVR is not alone. Other top multiplex players like Adlabs Films (where Anil Ambani holds a 51% stake), Inox Leisures, Shringar Cinemas (Fame multiplexes), Fun Multiplex (of Essel group) and Cinemax India too have ventured to small towns across the country.

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Jinesh Jayprakash Vasa – MMS-A (2008-2010) Roll number : 59 022-28985049; +91-9769683830; [email protected]

6. Marketing Communications Mix In order to make a profit on movies they showcase, multiplexes usually engage in a sometimes expensive marketing campaign to ensure that people will actually attend the movie. Several different techniques serve this end. Trailers - assemblies of excerpts from the movie screen prior to other movie showings. Advertisements in newspapers, on television, and movie-oriented websites can also help. More questionable practices include movie junkets, reliance on so-called quote whores and (allegedly) fake movie fan websites. The marketing communications mix can be divided in the following parts:

6.1.

Advertising:

The various mediums of advertising are:1. TV 2. radio 3. print (newspaper and magazine) 4. billboards (mobile advertising) 5. trailers (television and theatre)

6.2.

Publicity: 1. Posters 2. Website 3. Press (tabloids & broadsheet) articles and reviews 4. Magazines 5. Tie-ins (coffee outlets, online booking sites, credit cards, GSM/CDMA service providers etc) 6. Music launch, Premieres 7. Festivals 8. Mobile Phones

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Jinesh Jayprakash Vasa – MMS-A A (2008-2010) (2008 Roll number : 59 022-28985049; +91-9769683830; [email protected]

7. Comparative Analysis of Top 5 Multiplexes

Market Capitalization as on 5th Sep, 2008

4% 8%

Adlabs

12%

Inox PVR Cine 14%

62%

Fame

Net Profit

Net Sales

as on 5th Sep, 2008

as on 5th Sep, 2008

7%

10% 8%

9%

Adlabs 46%

11% 25%

Adlabs 36%

INOX PVR

PVR

21%

Cine

Cine

Fame

Fame 27%

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INOX

Jinesh Jayprakash Vasa – MMS-A (2008-2010) Roll number : 59 022-28985049; +91-9769683830; [email protected]

Multiplex

Market Capital (Rs.cr)

Net Sales (Rs.cr) Net Profit (Rs.cr)

Adlabs

2348.28

270.35

45.91

INOX Theatres

525.80

153.01

24.79

PVR

439.89

199.08

10.56

CINEMAX

262.50

67.64

8.20

FAME

153.27

51.59

9.83

Multiplex

# of properties

# of screens

Adlabs

70

181

INOX Theatres

44

179

PVR

16

62

CINEMAX

14

39

FAME

14

48

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Jinesh Jayprakash Vasa – MMS-A (2008-2010) Roll number : 59 022-28985049; +91-9769683830; [email protected]

8. Individual Brands (Multiplexes) at Glance

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Jinesh Jayprakash Vasa – MMS-A (2008-2010) Roll number : 59 022-28985049; +91-9769683830; [email protected]

8.1.

ADLABS CINEMAS

BSE: 532399

NSE: ADLABSFILM

Email : [email protected]

Internet : http://www.adlabsfilms.com

8.1.1. Background: This Company was incorporated on 2000 under the Companies Act as Adlabs Films Ltd to primarily carry on the business of building, owning, and operating Multiplexes, Theatres and entertainment centres. 8.1.2. Registered Office: Adlabs Films Limited, Film City Complex, Mumbai – 400065. 8.1.3. Unique Selling Point: NEVER A DULL MOMENT 8.1.4. Marketing Mix: Product: The Product is not purely a service for Adlabs. In addition movies they provide various eateries, shopping, games etc. Also the movies are screened at various show timings across all the Adlabs cinemas in the city, providing consistency to the viewers at different locations. Anil Ambani’s Reliance communications has acquired 51st Stake in this company in 2007. There are various other companies having minority stake in Adlabs.

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Jinesh Jayprakash Vasa – MMS-A (2008-2010) Roll number : 59 022-28985049; +91-9769683830; [email protected]

Middle and Upper income strata

Discerning

customer

looks

for

quality

as

well

good

value

for

money.

Aspirational – wants the best for himself / herself & family.

Promotion: Adlabs cinemas provide various offers along with tie-ups with other companies and many other services. 1. 2. 3. 4. 5. 6. 7. 8. 9.

Product launches and product displays and on-the-floor contests Tie ups with the Game Zone or F&B. Sampling. Menu branding at the café. Ticket jackets. Events. Movie schedules. Seat Jackets. Fun Innovations

Place: They have over 35 Multiplexes in India situated. They have a knack of locating the Multiplex where it is most needed in the city. All Cinemas are located at premium locations and symbolize excellence in design, ambience and service. Every Cinema is equipped with stateof-the-art equipment, so as to provide a moviegoer with a superior cinema viewing experience. Price: The rates are subject to changes depending on the festivals, movies, weekdays and weekends. But shows are cheaper in morning then other timings.

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Jinesh Jayprakash Vasa – MMS-A (2008-2010) Roll number : 59 022-28985049; +91-9769683830; [email protected]

8.2.

INOX Cinemas

BSE: 532706

NSE: INOXLEISUR

Email : [email protected]

Internet : http://www.inoxmovies.com

8.2.1. Background: The Company was incorporated as a public limited company as Inox Leisure Limited' vide a certificate of incorporation dated November 9, 1999 under the Companies act with the Registrar of Companies, New Delhi. It has obtained the certificate of commencement of business on February 11, 2000. 8.2.2. Registered Office. ABS Towers, Old Parda Road, Vadodara, Gujarat - 390007 8.2.3. Unique Selling Concept: LIVE THE MOVIE 8.2.4. Marketing Mix: Product: It is in the business of setting up and operating a national chain of world class multiplex cinema theatres. The Company continues to use the latest technology for giving high quality viewing experience to the patrons. Promotion: 1. Product launches 22 | P a g e

Jinesh Jayprakash Vasa – MMS-A (2008-2010) Roll number : 59 022-28985049; +91-9769683830; [email protected]

2. Product displays and on-the-floor contests 3. Tie ups with the Game Zone or F&B. 4. Sampling. 5. Menu branding at the café. 6. Events. 7. Movie schedules. 8. Fun Innovations 9. Tie ups with Banks 10. Offers Place: The target location and the audience for these cinemas is usually upper middle class and it is mostly located at the posh areas of a city. Price: The rates are subject to changes depending on the festivals, movies, weekdays and weekends. But shows are cheaper in morning then other timings.

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Jinesh Jayprakash Vasa – MMS-A (2008-2010) Roll number : 59 022-28985049; +91-9769683830; [email protected]

8.3.

PVR Cinemas

BSE: 532689

NSE: PVR

Email : [email protected]

Internet : http://www.pvrcinemas.com

8.3.1. Background: The Company was incorporated on April 26, 1995 under the Companies Act as Priya Village Roadshow Limited and obtained a certificate of commencement of business on December 4, 1995. On June 28, 2002 the name of our Company was changed from Priya Village Roadshow Limited to PVR Limited consequent to the exit of Village Roadshow Limited from our Company. 8.3.2. Registered Office: 61, Basant, Lok, Vasant Vihar, New Delhi 110 057. 8.3.3. Unique Selling Concept: High-class seating, state-of-the-art screens and audiovisual systems. 8.3.4. Marketing Mix: Product: PVR is the largest exhibition player in the country and our cinemas are known for their “consumer focus”. PVR Anupam in Saket launched way back in 1997, was India’s first multiplex and made cinema viewing a whole new experience with high-class seating, state-

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Jinesh Jayprakash Vasa – MMS-A (2008-2010) Roll number : 59 022-28985049; +91-9769683830; [email protected]

of-the-art screens and audio- visual systems. PVR Priya has the distinction of having the widest screen in India. Promotion: They brought premiere movie viewing to India with the exclusive Europa Cinema and Lounge at PVR Gurgaon and introduced Gold Class Cinemas in India at PVR, Bangalore. The former promises the very best in world and local cinema and pampers its patrons with food and beverages served at the seats. The Gold Class Cinemas too provide excellent pre-cinema experience and scrumptious food and beverages. The two-ultra luxurious, exclusive auditoriums at PVR Bangalore are each equipped with 32 plush and fully reclining seats with generous legroom. And they plan to take the concept to other cinemas across the country too.

Place: Every geographical segment comes with different psychographics. In Mumbai the movie going habit is far higher in terms of the number of visits to a theatre per year as compared to Delhi. That’s not surprising given the fact that Mumbai is the country’s capital for Hindi movies that guarantees livelihood to so many of its residents. Film watching is a part of most Mumbaikar’s DNA and that is the one clear and present difference that can only work in their favour. Company now operates and manages 82 screens across the country spread over Delhi, Haryana, Karnataka, Uttar Pradesh, Andhra Pradesh, Maharashtra, Gujarat and Madhya Pradesh. Price: During the year under review this Company had launched a new brand of cinema called PVR Talkies to cater the demand of the cinema viewing public in class B & C cities at a lower price range of Rs. 40 to Rs. 60 for an enhanced movie viewing experience. The total number of watched movies at the cinemas during this year was 14.73 million, as Compared to 8.78 million in the previous year. The average occupancy in the cinemas during the year was 43% as compared to 46% in the previous year. The Occupancies of the cinemas which operated for full year both in 2005-06 & 2006-07 increased from 46% to 49%.

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Jinesh Jayprakash Vasa – MMS-A (2008-2010) Roll number : 59 022-28985049; +91-9769683830; [email protected]

8.4.

CINEMAX Cinemas

BSE: 532807

NSE: CINEMAX

Email : [email protected]

Internet : http://www.cinemax.co.in

8.4.1. Background: This Company was incorporated on May 22, 2002 under the Companies Act as Cineline Entertainment (India) Private Limited to primarily carry on the business of building, owning, and operating Multiplexes, Theatres and entertainment centres. The name of the Company was changed to Cinemax Cinemas (India) Private Limited on December 23, 2005. They were converted to a public limited company by a resolution of the members passed at the AGM held on June 12, 2006. The fresh certificate of incorporation consequent to the change of name of our Company was issued by the RoC on July 27, 2006. 8.4.2. Registered Office: 8th Floor, 349 Business Point, Western Express Highway, Andheri (East), Mumbai 400069. 8.4.3. Unique Selling Concept : ENJOY and RELAX (RED LOUNGE) 26 | P a g e

Jinesh Jayprakash Vasa – MMS-A (2008-2010) Roll number : 59 022-28985049; +91-9769683830; [email protected]

8.4.4. Marketing Mix: Product: They have targeted the people who are watching movies for sheer comfort and experience. They have met the demand really well for the service they are providing. Promotion: All the theatres have their unique features. Cinemax (Wonder Mall) that was the first multiplex to come up in Thane, has a picturesque fountain up front and Cinemax (Sion) a wonderful garden terrace and cafe. Cinemax (Goregaon) has distinctive river slope seating while Cinemax in Andheri (East) boasts of a curved auditorium with each seat at the same angle from the screen. As far as competition goes, it’s always healthy and considering that a second theatre (Fun Republic) didn’t result in a big hit to the business of the existing cinema (Fame), I don’t think our presence in the area is cause for undue concern. Place: This is wonderfully segmented, although the location is in suburbs, it introduced the concept of RED LOUNGE, giving a whole new experience of comfort. Price: They have priced the tickets at less than Rs 100 in Nashik (Non-metros), while in its Mumbai property the average ticket price is Rs 150 (metros). Also, revenues from food and beverages (F&B) and advertisements are lower in smaller towns. According to Sampat of Cinemax, F&B revenue constitute 15-20% in non-metros compared to 20-25% in metros. "While ad revenue in metros would be 10%, non metros would yield 5%," he adds. "Since my margins in food and beverages are as high as 65%, lower F&B revenues from the segment, would delay my break even in B and C class cities," murmurs a multiplex operator who doesn't want to be named. Also although the ticket rates are in sync with other cinemas, the Red Lounge provides a whole new comfort zone at a steep price.

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Jinesh Jayprakash Vasa – MMS-A (2008-2010) Roll number : 59 022-28985049; +91-9769683830; [email protected]

8.5.

FAME Cinemas

BSE: 532631

NSE: FAME

Email : [email protected]

Internet : http://www.famecinemas.com

8.5.1. Background: They were incorporated on October 26, 1999 as a private limited Company under the name shringar group later changed their name to Fame India. 8.5.2. Registered Office: Fame Adlabs, 2nd Floor, Andheri Link Road, Mumbai – 400053. 8.5.3. Unique Selling Concept : Ambience and Premiers 8.5.4. Marketing Mix: Product: Shringar Cinemas made its foray into the world of multiplexes with Fame Adlabs, which was launched in Mumbai in 2002. In quick succession, within the next 2 years, doors of Fame Malad, Fame Nashik and Fame Kolkata were opened to the public. Not only did these multiplexes change the landscape of Mumbai and Nashik, they also set unparalleled benchmarks as the city’s finest entertainment destinations. Their sole mission is to provide our patrons a unique movie viewing experience. It will be their constant endeavour to improve and innovate every aspect of our theatres, in order to make it a truly distinctive experience.

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Jinesh Jayprakash Vasa – MMS-A (2008-2010) Roll number : 59 022-28985049; +91-9769683830; [email protected]

Promotion: Fame Cinemas constantly endeavours to bring in the highest quality of entertainment to Mumbai's film going audience. Fame has transformed the experience of cine goers into a pleasant, very user-friendly and delightful experience. Given the commitment to the quality of service & films being screened, there is little wonder then that, Fame has a burgeoning set of loyal customers who love getting pampered here. Watching a movie at Fame Cinemas is like taking a short vacation. There is a cool ambience, quality service and convenience in booking i.e. you can engage in cashless booking transactions. There are even more facilities for booking tickets. 1. 2. 3. 4.

Mobile Booking Festivals Tie ups with service providers Brand recognition

The latest promotion is the tie-up with Vodafone. Here the Vodafone subscriber have a send an SMS to 56789 with text TUESDAY M on Tuesdays and they will receive a code instantly. They have to show this code at the cinemas on Tuesdays only and avail one ticket free for every ticket bought. Place: Fame Thakur Movie is the company’s seventh property in Mumbai, including Fame Adlabs Versova, Fame Inorbit Malad, Fame Raghuleela Kandivali, Fame Thakur Kandivali, Fame Nakshtra Dadar and Fame Dahisar. Countrywide, Shringar Cinemas will be doubling its multiplexes to 22 in the current fiscal with an investment of Rs 60,000-70,000 per seat. Shringar plans to open 50-60 multiplexes with around 300 screens in the next five years across the country. Price: It was the trend setter of reducing rates for the morning shows and segmenting ticket rates according to show timings.

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Jinesh Jayprakash Vasa – MMS-A (2008-2010) Roll number : 59 022-28985049; +91-9769683830; [email protected]

9. Conclusion Once in place, the multiplex developed a counter to the unitary propensity of the single screen hall, founded on exclusion, perpetuating homogeneity and cultivating committed audience segments. While single screen cinemas identify themselves with films of particular kinds, say the Hindi masala and blockbuster, the English, or the porn movie, the multiplex has capitalised on an inclusive tendency to motivate and assemble diverse audiences. On the one hand it has contained the influence of embourgeoising forces within its edifice, allowing on its screens the interplay of alternative and mainstream or conventional strains. Further it has limited contact with the West to no more than the fashioning of its site, preventing the hegemony of either Hollywood blockbusters as the result of a partial global encounter, or conventional Bollywood films that enjoy a pan-linguistic and cultural appeal cutting across regional, religious, class and other variants. On the other hand, it has remained an urban, largely middle and upper middle class leisure pursuit, with its highly priced tickets excluding the masses crowded in the lower regions of the income graph. While the masses take to cinema readily, given their financial capacity and lack of identification with the plush appearance, products and services at the multiplex – in any case targeted at the socially and economically mobile sections – this numerically significant chunk of audience has remained confined to the outer edges of the multiplex experience. And it is unlikely that the dynamics of the multiplex in its present avatar will manage to secure their participation. Spatially too, multiplexes can mostly be spotted in affluent neighbourhoods, within the easy reach and concentration of young audiences. So far a nascent experience, the number of multiplexes is soon slated to rise sharply. The full impact of its rapid spread, particularly over the last two years, is yet to be determined given the long gestation periods and concentration in and around selected pockets. As a result, it is too early to draw any conclusions about its impact or chart any definite course for its future. Going by the variables that are emerging in response to the needs of immediate audiences, and the fact that in its present form it has acknowledged cinema as composed of diverse possibilities, the multiplex may in the future enhance segmentation and result in branded theatres exhibiting particular fare, say the art, mainstream, or foreign films, maybe even documentaries. The mechanisms of competition would then come into operation and influence aspects such as ticket pricing.

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Jinesh Jayprakash Vasa – MMS-A (2008-2010) Roll number : 59 022-28985049; +91-9769683830; [email protected]

10. RECOMMENDATIONS The Indian film industry’s immense potential for growth is very evident. The ingredients for success are present but the growth drivers need to be enabled by the Government and the industry through implementation of the various regulatory and policy measures. The industry will then be able to realise its dreams of becoming globally competitive and establish the country as a significant player in the global entertainment (film) industry. The government also needs to deal with topics as diverse as fighting copyright theft, insurance and niche broadcasting to radio programming, scripting and the new frontiers in filmmaking. Based on the SWOT analysis done in the previous chapter, following steps are suggested to improve the film industry and thus help marketing of movies.

10.1. Expansion in exhibition infrastructure At 12.5 screens per million people, film exhibition infrastructure in India is much lower than in developed countries and woefully inadequate for the large population. The average seating capacity of a theatre in India is between 700 and 800. General attendances are only 35% of capacity. The high level of taxation has led to under investment in the exhibition infrastructure resulting in decrepit cinema halls. India has seen a decline in cinema attendance due to poor cinema content and an inadequate film exhibition infrastructure. Thus to sell their movie the film industry needs to explore other revenue streams such as home video, DVD sales and rentals, cable television rights, pay per view, video on demand and merchandising. In order to boost revenues, there is a compelling need to expand and spruce up the exhibition infrastructure.

10.2. Ceilings on ticket rates Pricing of a ticket is a state subject and regulations for pricing differ from state to state. This regulation, present in some states, has rendered operations of numerous theatres unprofitable. While some of the states like Maharashtra and Delhi do not have restrictions on pricing, certain states still control it. In the Southern states where ticket prices are fixed by the collectorate, theatres owners are not allowed to freely price tickets. High taxation has also led to exhibitors under-reporting the levels of ticket sales to avoid paying taxes and sharing the box office profits with the producers/directors and distributors This has led to a parallel marketing of tickets in these states, more so in the rural areas, causing significant loss of revenues to the state. The state governments should thus consider doing away with this regulation. From its present shape, there only emerge more queries than any concrete predictions. Will the rapid spread of the multiplex and its concentration in particular zones with audiences constituting existing and potential markets for the retail entities supporting the multiplex, emerge as the dominant trend, and push doors for further segregation and institutionalization of segmented audiences, leading to branded multiplexes? Or will encouragement from the 31 | P a g e

Jinesh Jayprakash Vasa – MMS-A (2008-2010) Roll number : 59 022-28985049; +91-9769683830; [email protected]

various governments drive away the multiplex, aiding its penetration into other urban and semi urban, non-affluent territories? Will the multiplex alter existing film form so as to align with its own plush and colourful appearance? Or will it encourage alternative films? Its dispersal away from well-heeled spaces is crucial if the intention is for it to emerge as at least a pan-urban, if not a pan-Indian experience. Well meaning as government policies may be, without their committed implementation and in the absence of the shopping mall culture in other locales, the possibilities of the multiplex there remain suspect. But in the meanwhile cinema stands redefined for the Indian viewer as composed of fare other than the regular three-hour film. From the present assortment at least, sporadic and transitional as it may be, there are definitely more films to choose from. And the choices aren’t merely linguistic.

10.3. Technological Advancement: With the introduction of DTH, they will have will have to make use of the new technology for better quality, without which the business can be impacted. Also, the main reason for watching movie in multiplex is the experience and the quality, unless they come up with an idea to cater the high demands of the consumer, they will lose in the race of such a competitive environment.

10.4. Way forward: • Over the next 18-24 months, 5 of the largest multiplex operators in India mentioned earlier are likely to commercialize approximately 200-240 screens spread across 50- 60 new multiplexes. • These multiplexes will have a cumulative seating capacity in excess of 55000-60000. • There will also be an increase in number of multiplexes operated by smaller players, who constituted 66% of total multiplexes as of march 2007. • It is estimated that number of operating multiplexes in India will increase by 80-100% by end of 2010. • By the end of 2009, 135+ multiplexes will house more than 160,000 seats spread across 500+ screens. • These multiplexes will have significant direct positive impact on the business economics of film production, financing, distribution and exhibition and indirectly on other ancillary markets.

10.5. Major Suggestions


Most of the movie audience watch a movie for pleasure and prefer watching a comedy movie. Since emotional movies are already plenty for people to watch on television and also people need to divert their minds from the tension-filled world, more of light, comedy movies should be made. And, the story of the movie shouldn’t be ignored at all.




It is seen that the mass channel for creating awareness about the movie is television which should be used more effectively by promotion through TV serials, advertisements, etc.

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Jinesh Jayprakash Vasa – MMS-A (2008-2010) Roll number : 59 022-28985049; +91-9769683830; [email protected]

Also, the widely used newspaper i.e. TOI (in Mumbai), can be used as a medium for promotion.


Word of Mouth being the most influential on the people for making decisions should be tackled properly. Negative word of mouth should be curbed by encouraging star premiers, freebies, newspaper reviews, and such other steps.




There are number of Growth drivers responsible for the expected increase in the number of multiplex cinemas, if taken into proper consideration, can help in meeting the demands. They are as follows:  An increase in disposable income in the hands of an ever-expanding Indian middle class  Favourable demographic changes  Organised retail boom  Entertainment tax benefits for multiplex cinemas  Increase in the number of high grade Hindi films.

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Jinesh Jayprakash Vasa – MMS-A (2008-2010) Roll number : 59 022-28985049; +91-9769683830; [email protected]

11. BIBLIOGRAPHY http://www.india-seminar.com – Aparna Sharma http://www.moneycontrol.com – Market Research http://www.adlabsfilms.com – Locations and Prices http://www.inoxmovies.com – Locations and Prices http://www.pvrcinemas.com – Locations and Prices http://www.cinemax.co.in – Locations and Prices http://www.famecinemas.com – Locations and Prices http://www.rediff.com/money - 24th Jan, 2008. http://rohanrrao.wordpress.com – 13th October, 2007. http://www.screenindia.com – Interviews, Oct 2006. http://www.google.com – Other information http://www.asianadage.com http://www.shringar.co.in http://www.indiantelevision.com http://www.indiescene.net http://www.seattletimes.nwsource.com

Media release, May 03, 2005, New Delhi – BBC World’s Talking Movies D’Essence Consulting - Report for 2005 and 2007. Statistical Analysis – Yes Bank. MAGAZINES: BUSINESS INDIA – JULY 7 TO 20 THE WEEK – September 11, 2005

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