While movie theaters are the beneficiaries of high-quality Hollywood content, concurrently they have the responsibility to entertain and host 1.3 billion moviegoers each year. With the onslaught of entertainment competition the bar is set very high. Realistically, movie theaters need to rely on more than ticket and concession sales to thrive. With the Cinema Advertising Council recently announcing 2016 revenues growing 5.8% to $750M, innovative business models are required to ensure that Screenvision Media is in lock-step with its affiliate constituency to continue to propel growth.
I interviewed Screenvision's Darryl Schaffer, Executive Vice President of Exhibitor Relations and John McCauley, Executive Vice President, CMO and Strategic Alliances to learn about their vision for this unique blend of partnership. By the way – for those of you not in the know (I wasn't) – the "Exhibitor Relations" role is the equivalent of "Affiliate Relations" for cable or "Audience Development" for online.
By the numbers, the Screenvision Exhibitor Relations team manages 170+ different theater chains, 2,290 physical theaters, 14,500-plus screens and millions of annual moviegoers in every state and across 93% of U.S. DMAs. The exhibitor relations role is key to cinema advertising and every bit as essential as affiliate relations is with the cable networks and cable operators. Darryl and her team help lead Screenvision Media's efforts to grow experiential and economic value for and alongside this key constituency.
"With 25 years in cinema advertising I have seen quite a bit of change," Darryl said. "There is no question that it is important to propose the right economics to get a deal done, but increasingly creation of mutual incremental value through partnerships has been instrumental in our success. With aggressive retention and acquisition goals I am proud that we have experienced virtually no turnover while winning new business, including some theaters that have never aired ads before."
Darryl and John shared four simple guidelines they follow to help drive innovation, cooperation and incremental revenue for affiliates:
- While content may be king, never forget that affiliates control distribution -- scale, breadth and diversification. Partnership ensures that you and your publishers reach a target audience.
- The changing media landscape requires new compensation models. Transactional relationships are being replaced by longer term, more comprehensive business partnerships. We're not talking dinners and social outings (though those are always nice). The conversation has moved to "How can we help your business grow? How can we use our platform and resources to help drive your profits and EBITDA?"
- Partner closely with your affiliates to really understand their business challenges and opportunities; tailor offerings (assets and resources) to help improve their bottom line. Learn how they generate revenue and drive profit.
- Change the game and go-to-market strategies to enable both parties to benefit. Screenvision labeled this "mutual incremental value."
Darryl and John are a team and both share an affinity and long history working within the affiliate ecosystem. As mentioned above, Darryl has seen almost no churn with exhibitors and theater chains which are her affiliates. “I have benefitted from working on both sides of the affiliate relationship," John commented. "With the NFL, I represented the league partnering with team affiliates. At Loews I was a Screenvision affiliate. And now, at Screenvision, I am working hand-in-hand with Darryl and our affiliate network to drive mutual value.”
Here are some examples of how Screenvision creates that mutual incremental value for its exhibitors/theaters:
- Providing prefeature entertainment with its Front and Center preshow, including a renewed focus on the local community connection;
- Enhancing lobby experiences with digital and interactive signs for moviegoer entertainment while waiting for the movie, which is also a driver of incremental revenue;
- Utilizing technology and data: Geo-fencing/re-targeting and beacons provide theaters with enhanced insights around moviegoers to drive incremental sales and potentially identify an incremental revenue stream;
- Creating custom theater branding via Screenvision's in-house agency, 40 Foot Studios. This can include custom preshows, for example, Screenvision Select for Art House theaters.
"There is no doubt relationships matter a great deal," John concluded. "At the end of the day, a real understanding of each other's respective business enables more innovation and accelerated growth. Cinema Advertising Council (CAC) recently announced the 2016 revenue growth of 5.8%. Our affiliate philosophy was instrumental in our industry-leading growth, where we saw a 24 percent revenue-per-patron increase during 2016. Cinema Advertising is a rising tide sector and we are excited to continue to work with exhibitors to continue to drive growth."
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