Led by one of the world’s most powerful millennials – Saudi Crown Prince Mohammed bin Salman, ‘Vision 2030’ is steering KSA into an unprecedented era of social and economic reform.
Having adopted entertainment as one of the key pillars in its new development plan, ‘Vision 2030’ initiated the lift on the 35-year-old ban on cinema, which in turn has opened up a previously untapped and lucrative revenue stream for the Kingdom and its entertainment sector.
A Kantar TNS study conducted among Saudi residents in 2017 shows fresh opportunities for marketers to make inroads into the Kingdom. As per the research, 67 per cent of respondents said they would head for a round of movie watching and 90 per cent of Saudi residents plan to visit malls with cinemas more often. Thus, cinema advertising is set to become a new growth medium, presenting significant opportunities for advertisers to target young (Saudi Arabia has 32 million consumers with the majority under 25) and affluent (Saudis spend more than $5 billion a year on overseas leisure travel) audiences within KSA.
The government of KSA estimates that movie theatres will contribute over 90 billion riyals ($24 billion) to the economy, with about 300 cinemas and 2,000 screens to be built in the country by 2030.
Existing Cinemas in Saudi Arabia
April 2018 witnessed the launch of Saudi Arabia’s first cinema operated by AMC Theatres – a single screen cinema with a total seating capacity of 620, followed by the launch of VOX Cinemas at Riyadh Park Mall in May 2018 – featuring an IMAX screen, 2 KIDS screens and 1 VIP screen with a total seating capacity of 330.
Upcoming Cinemas in Saudi Arabia
AMC Theatres will be a major contributor to the total cinema count in Saudi Arabia by 2030, as the cinema operator intends to open 30 to 40 cinemas in 15 cities over the next five years, growing to 50 to 100 theatres by 2030.
VOX Cinemas has a SAR 2 billion investment plan in place to expand its footprint to a total of 600 screens in the Kingdom over the next five years. As part of this plan, the leading cinema chain recently announced the opening of the first multiplex in Jeddah at Red Sea Mall by December 2018 – featuring 12 screens which will include three GOLD by Rhodes and an IMAX screen, and a 15-screen multiplex in the first quarter of 2019 at Al Qasr Mall in Riyadh – featuring its signature KIDS and MAX experiences.
Al-Rashed Empire Cinema Consortium – who successfully received a license to operate cinemas in the Kingdom in July 2018, will be the third player in the market. The cinema operator has plans to open as many as 30 cinemas in various cities around Saudi Arabia.
Cinema Advertising in KSA
As the exclusive cinema advertising partner of VOX Cinemas and the only company presently selling cinema advertising in KSA, Motivate Val Morgan has received an overwhelming response since the launch of the cinema at Riyadh Park Mall.
With a growing appetite for international/regional content and world-class cinema experiences, existing cinema operators stepping up plans to open additional screens across the country and more operators expected to enter the fray, KSA presents a hotbed of opportunities for cinema advertisers over the next few years.
Meet the first cinema advertiser in Saudi Arabia, browse the list of upcoming blockbusters releasing in Q4 2018 and contact a member of our sales team for more information on cinema advertising opportunities in Saudi Arabia.
Sources: KSA Entertainment, Film Journal, Gulf News, The Arabian Marketer, The Washington Post, Wikipedia, Saudi Gazette, The Motley Fool, PR Newswire and Arabian Business
2017 was an exceptionally good year for ticket sales and 2018 could offer a repeat, says Cameron Mitchell, CEO of Majid Al Futtaim Cinemas.
In Dubai, the web or TV is not winning the war in what people watch or how they want to watch it. Ticket sales at local cinemas have just had another solid year of growth in 2017, and 2018 could be in for another “high single-digit” run – with releases such as Black Panther pulling them in, it could well be the case.
“Certain cities in the region have a high screen (capacity) per million people, which is one measure we use in the industry,” said Cameron Mitchell, CEO of Cinemas at Majid Al Futtaim group. “And Dubai is one of those which also has a high (cinema) attendance per capita.
“With growth in real estate and in residential development, more screens are being added. Just drive along Al Khail Road and you see the amount of development that is taking place — and it is directly linked to population (growth expectations) and of affordability.
“Cinema is still the most affordable entertainment — at $10 (Dh35) for two hours, it is still the case. And this has remained unchanged since 2011, which was the last time ticket rates were raised, and that too only by Dh5.
“The industry looks at the issue of ticket prices periodically … but we are not expecting any change at the moment.”
The group operates the VOX Cinemas network and currently has 95 screens in Dubai, 40 screens in Abu Dhabi, 9 screens in Ajman, 11 screens in Fujairah and 8 screens in Ras Al Khaimah. A total of 163 screens in the UAE, with plans to double it in the medium-term.
The UAE has over 400 operational screen (as of February 2018), and Dubai alone has over 200 operational screens – with many more set to open in the near future. Master-developers such as Emaar and Meraas have their own multiplex operations – through Reel Cinemas and Roxy Cinemas (respectively), and it sure makes sense for developers who are building up entire self-contained destinations to have those cinemas as well.
Clearly, cinema operators do not see web-streaming TV as a dire threat to their numbers – at present and in the future. “I think there’s a big difference between sitting at home on a couch and watching something on TV and being at one of our entertainment destinations,” Mitchell said.
“For mall developers/owners, this helps bring more people to their properties. Cinemas can be a really attractive anchor proposition. But they remain an expensive business.
“So long as cinema operators keep focusing on the guest experience and the movie experience, I can only see growth happening. Essentially, it’s about offering the experience.
“You could argue that anything you have in a restaurant; you can technically have it at home. But we still would like to go out for dinner. And look at the Starbucks business in the region — they keep adding more locations. Even though you can have a great cup of coffee from an espresso machine and which would be cheaper (than at Starbucks).”
For VOX Cinemas, it does not stop with just putting up a screen at one of Majid Al Futtaim’s mega-malls in the making. VOX has been working on the product mix; creating a premium ‘Theatre by Rhodes’ and ‘Gold by Rhodes’ and offering menus curated by chef Gary Rhodes — he of the Michelin star fame.
“So if someone is making a plan to go out to dinner and take in a movie, why not do it together? That’s the proposition we had put forth with the Rhodes alliance,” said Mitchell.
And then there are the VOX kids screens, which come with their own party room.
Teen Screens
Next month, VOX Cinemas will again be experimenting with a new concept — screens for teens. This will be at its brand new facility in Kuwait (The Avenues Mall developed by Al Shaya Group). The concept originated in-house.
“They feature a different design with a shared couch and — given the demographic — with an extremely tech-friendly environment. They can have access to gaming and watch wrestling or concerts on the screen. With teens, everything is a shared experience. Plus, there are the movies, of course.”
After debuting in Kuwait, VOX Cinemas has plans to spread the teen screen concept out elsewhere. However, no definite timeline has been set for this.
“What we are making at the cinemas is a multi-purpose environment — where you could come to watch 400 films a year or come for myriad other activities. That’s your choice,” said Mitchell.
Mall owners and cinema operators wait for the screens to light up
If there is one detail that animates the region’s cinema industry, it would be Saudi Arabia’s plans to allow screens back into business.
“We are all waiting for some guidance from the Saudi Government,” to know what will be permitted for screening and how the cinemas should look,” said Mitchell
“The Vision 2030 plan is very clear — citizens in Saudi Arabia should enjoy the same entertainment as the rest of the world and that it wants to work with private operators to make it happen. We expect that the first cinemas will be released within six months of the legislation being released.”
The Majid Al Futtaim Group is currently committed to develop two malls in Riyadh, for a combined investment of SR14 billion.
Motivate Val Morgan is the official cinema advertising partner of VOX Cinemas – except for the cinema at City Centre Bahrain.
Source: Gulf News and MVM Stats
