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Cinemas - UK - June 2010

Mintel last reported on this market in Cinemas – UK May 2008. This report charts the development of industry revenues and admissions since then, identifies current issues and market trends, and provides pointers as to likely future developments.

  • The cinema market has continued to grow both in terms of number of admissions and revenues generated during 2009, in spite of recessionary pressures. Industry revenues of £1.3 billion in 2009 were up 9.5%, while admissions also showed strong growth, being 5.7% higher.
  • Cinema is seen by consumers as an affordable treat during times of recession so that, while they have been making cutbacks and sacrifices in other areas of their lives, a trip to the cinema allows them to escape everyday pressures for a while without feeling guilty about how much they are spending.
  • The increased proportion of movie titles released in 3D was behind the stronger growth in revenue compared to admissions. 3D typically attracts a price premium of around 30% (taking average ticket prices to nearer £7 compared to just over £5 for a standard 2D movie). 3D also has the added attraction to exhibitors and film distributors of being much harder to pirate through recording using a video camera in the auditorium.
  • A strong shift towards digital screens in UK cinemas has enabled cinema operators to diversify into new areas, such as the screening of live sports events, music concerts and ballet and opera performances. Operators are increasingly courting the corporate market for venues for conferences, product launches and presentations.
  • A steady flow of strong movie releases from established franchises such as Harry Potter and Pirates of the Caribbean has also helped sustain market growth and this is set to continue with the late 2010 release of the penultimate film in the Potter series and in 2011, when the final Potter film and a fourth Pirates of the Caribbean movie come out.
  • At 73% of the total, box office takings represent the bulk of industry revenues and have been increasing their share due to the growth of 3D. Retail revenues, mostly from the sale of food and drink, account for 27% of the cinema market. Demand has been affected by the recession - consumers have not necessarily cut back but they are not spending any more than they were a few years ago.

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Table of contents

  1. Issues in the Market

      • Main issues
        • Definition
          • Abbreviations
          • Future Opportunities

            • Standing room only
              • A need for differentiation?
              • Market in Brief

                • Cinema buoyant on back of strong admissions and revenue growth
                  • Product quality drives admissions
                    • 3D provides box office boost
                      • Secondary revenues subdued by recessionary pressures
                        • Digital development opens up possibilities
                          • 3D helps to counter piracy
                            • Exhibitors under pressure to reduce theatrical window
                              • Big three maintain their dominance
                                • Little differentiation between main brands
                                  • Film distributors shoulder bulk of responsibility for promotion
                                    • Regular visitors most likely to go with partners
                                      • Food and drink prices lead many to bring their own
                                        • Ticket prices becoming a concern?
                                          • Most support for improvements to hot drinks offer
                                          • Internal Market Environment

                                            • Key points
                                              • Product drives the market
                                                • Figure 1: Box office results for the top 20 films released in the UK and Republic of Ireland, 2008
                                                • Figure 2: Top 20 films released in the UK and Republic of Ireland, 2009
                                                • Figure 3: Top 20 films at the UK box office, 1998-2009
                                              • Digital develops rapidly…
                                                • Figure 4: Number of high-end digital screens in the UK, 2005-09
                                              • … at a cost but with benefits…
                                                • VPF the solution for some operators…
                                                  • … as 3D finally breaks through in 2009
                                                    • Figure 5: 3D digital screens in the UK, 2006-09
                                                    • Figure 6: Top ten 3D releases, 2009
                                                  • Piracy still a problem but 3D may help
                                                    • Figure 7: FACT seizure figures and analysis, 2000-07
                                                  • Theatrical window issue raises hackles
                                                    • Every cloud has a silver lining
                                                      • Figure 8: UK weather trends, 2002-09
                                                  • Broader Market Environment

                                                    • Key points
                                                      • Focus shifts to debt reduction, governmentally and personally
                                                        • Figure 9: GDP, PDI, consumer expenditure and savings, at constant 2005 prices, 2005-15
                                                      • Recession increases focus on value
                                                        • Figure 10: Agreement with statements about impact of recession on leisure behaviour, July 2009
                                                      • Child population growth good for animated/family films
                                                        • Figure 11: Trends in the age structure of the UK population, 2005-15
                                                      • More affluent population offers potential for secondary spend growth?
                                                        • Figure 12: Forecast adult population trends, by socio-economic group, 2005-15
                                                      • Trends point to opportunities for content aimed at older age groups
                                                        • Figure 13: Forecast adult population trends, by lifestage, 2005-15
                                                      • Singles rise set to continue
                                                        • Figure 14: UK households, by size, 2005-15
                                                      • Internet growth: old news but still has implications for operators
                                                        • Figure 15: British internet penetration at home/work/place of study or elsewhere, by gender, socio-economic group, age, region and working status, 2002-09
                                                      • Immigration presents opportunities for operators
                                                        • Figure 16: Long-term international migration, by age and gender, 1991-2008
                                                        • Figure 17: Top five foreign languages at the UK and Republic of Ireland box office, 2008
                                                    • Competitive Context

                                                      • Key points
                                                        • Cinema outstrips the leisure market
                                                          • Figure 18: Consumer expenditure on selected leisure activities, 2005-09
                                                        • Nearly a quarter visit cinema every month but TV dominates leisure time
                                                          • Figure 19: Participation in leisure activities, 2009
                                                        • Multi-channel and cinema thrive alongside one another…
                                                          • Figure 20: UK multichannel TV households, by platform, 2005-08
                                                        • … while growing broadband penetration opens up further possibilities
                                                          • Figure 21: Trends in british internet penetration, April 2008-Jan 2010
                                                        • Pre-recorded video and DVD sales dwarf cinema
                                                          • Figure 22: Pre-recorded video and DVD industry key metrics, UK, 2004-08
                                                        • Cinema-goers big on in-home technology
                                                          • Figure 23: Electronic equipment owned, by most popular ways of watching movies by regular film watchers, July 2009
                                                      • Strengths and Weaknesses in the Market

                                                          • Strengths
                                                            • Weaknesses
                                                            • Who’s Innovating?

                                                              • Key points
                                                                • HMV: Coming to a store near you
                                                                  • Kissing in the back row…?
                                                                    • Mixing it up to keep the offer fresh
                                                                      • Modifying for mobile users
                                                                        • Making payments easier
                                                                        • Market Size and Forecast

                                                                          • Key points
                                                                            • Revenue and admissions growth drive market forwards
                                                                              • Figure 24: UK cinema market, 2005-15
                                                                            • Market reaches a new five-year high in 2009
                                                                              • The future’s bright...
                                                                              • Market Segmentation

                                                                                • Key points
                                                                                  • 3D provides box office boost
                                                                                    • Figure 25: Breakdown of UK cinema turnover, 2005-09
                                                                                  • Cinema adspend levels out
                                                                                    • Figure 26: Cinema advertising revenue*, 2005-09
                                                                                  • ... but wind of change blows through the sector
                                                                                    • Admissions closely linked to school holiday times
                                                                                      • Figure 27: UK cinema monthly admissions, 2005-09
                                                                                    • Multiplexes continue to drive screens growth
                                                                                      • Figure 28: Trends in UK cinema site and screen numbers, 2005-09
                                                                                    • Multiplexes march on
                                                                                      • Figure 29: UK multiplex development, 1985-2009
                                                                                    • London is cinema capital
                                                                                      • Figure 30: Trends in UK cinema screens by region, 2005-09
                                                                                  • Market Share

                                                                                    • Key points
                                                                                      • Big three dominate in terms of share of screens
                                                                                        • Figure 31: Cinema operators in the UK, by number of sites and screens, December 2009
                                                                                        • Figure 32: Cinema operators in the UK, by number of multiplex sites and screens, December 2009
                                                                                    • Companies and Products

                                                                                      • Key points
                                                                                        • Major circuits
                                                                                          • Odeon
                                                                                            • Figure 33: Odeon and UCI Cinemas Group, key financials, 2007-08*
                                                                                          • Cineworld Group plc
                                                                                            • Figure 34: Cineworld Group Plc, key financials 2009
                                                                                            • Figure 35: Cineworld Group plc, revenue by source, 2008-09
                                                                                          • Vue
                                                                                              • Figure 36: Vue Entertainment Holding UK Ltd, key financials 2009
                                                                                            • Circuits (50+ screens)
                                                                                              • Showcase
                                                                                                • Figure 37: National Amusements UK, key financials, 2008-09
                                                                                              • City Screen
                                                                                                • Figure 38: City Screen Ltd, key financials, 2007-08
                                                                                              • Reel Cinemas
                                                                                                • Empire
                                                                                                  • Apollo
                                                                                                    • Figure 39: Apollo Cinemas, key financials, 2008-09
                                                                                                  • Ward Anderson
                                                                                                  • Brand Elements

                                                                                                    • Key points
                                                                                                      • Brand map
                                                                                                          • Figure 40: Attitudes towards and visits to cinema brands, January 2010
                                                                                                        • Brand qualities of cinema brands
                                                                                                          • Vue has the edge
                                                                                                            • Figure 41: Personalities of various cinema brands, January 2010
                                                                                                          • Experience of cinema brands
                                                                                                            • Odeon most visited, Picturehouse lacks awareness
                                                                                                              • Figure 42: Consumer usage of various cinema brands, January 2010
                                                                                                            • Brand consideration for cinema brands
                                                                                                              • Odeon most considered
                                                                                                                • Figure 43: Consideration of various cinema brands, January 2010
                                                                                                              • Brand satisfaction for cinema brands
                                                                                                                • Vue best all-round
                                                                                                                  • Figure 44: Satisfaction with various cinema brands, January 2010
                                                                                                                • Brand commitment to cinema brands
                                                                                                                  • Cineworld and Vue battle for customer loyalty
                                                                                                                    • Figure 45: Commitment to various cinema brands, January 2010
                                                                                                                  • Brand intentions for cinema brands
                                                                                                                    • Vue and Cineworld have best retention
                                                                                                                      • Figure 46: Future usage intentions for various cinema brands, January 2010
                                                                                                                    • Brand recommendation for cinema brands
                                                                                                                      • Cineworld and Vue most recommended, small players less pleasing
                                                                                                                        • Figure 47: Recommendation of various cinema brands, January 2010
                                                                                                                      • Cineworld
                                                                                                                        • What the consumer thinks
                                                                                                                          • Figure 48: Attitudes towards the Cineworld brand, January 2010
                                                                                                                        • Picturehouse
                                                                                                                          • What the consumer thinks
                                                                                                                            • Figure 49: Attitudes towards the Picturehouse brand, January 2010
                                                                                                                          • Vue
                                                                                                                            • What the consumer thinks
                                                                                                                              • Figure 50: Attitudes towards the Vue brand, January 2010
                                                                                                                            • Odeon
                                                                                                                              • What the consumer thinks
                                                                                                                                • Figure 51: Attitudes towards the Odeon brand, January 2010
                                                                                                                            • Brand Communication and Promotion

                                                                                                                              • Key points
                                                                                                                                • Distributors drive demand with promotional clout
                                                                                                                                  • Figure 52: Main media expenditure, by UK film distributors and cinema exhibitors, 2005-09
                                                                                                                                • UK film distributors
                                                                                                                                  • Figure 53: UK film distributors’ media expenditure, by channel, 2005-09
                                                                                                                                • Universal and Sony spend big for small returns
                                                                                                                                  • Figure 54: UK film distributors – top ten advertisers, 2005-09
                                                                                                                                  • Figure 55: UK film distributors – top ten advertisers, by channel, 2009
                                                                                                                                • UK cinemas
                                                                                                                                  • Figure 56: UK cinemas’ media expenditure, by channel, 2005-09
                                                                                                                                • Cineworld dominates cinema spending
                                                                                                                                  • Figure 57: UK cinemas – top ten advertisers, 2005-09
                                                                                                                                • Cineworld treads a different path
                                                                                                                                  • Figure 58: UK cinemas – top ten advertisers, by channel, 2009
                                                                                                                                • Promotions
                                                                                                                                • Cinema Visiting Habits

                                                                                                                                  • Key points
                                                                                                                                    • Figure 59: Frequency of visiting the cinema and with whom, March 2010
                                                                                                                                • Attitudes Towards Cinema and Film

                                                                                                                                  • Key points
                                                                                                                                    • Figure 60: Attitudes towards going to cinema, March 2010
                                                                                                                                  • Food and drink prices grate…
                                                                                                                                    • … and drive many to bring their own
                                                                                                                                      • Three quarters ‘wing it’
                                                                                                                                        • Has the ticket price tipping point been reached?
                                                                                                                                          • Movies at home boost interest in film?
                                                                                                                                            • Many would like to go more often
                                                                                                                                              • Weekday trade strong
                                                                                                                                                • Reviews carry weight
                                                                                                                                                  • Rebalancing required to take needs of adult market into account?
                                                                                                                                                    • Short theatrical window leads to a quarter waiting
                                                                                                                                                      • Popcorn tugs parents’ heartstrings
                                                                                                                                                      • Attitudes Towards Improving the Cinema Experience

                                                                                                                                                        • Key points
                                                                                                                                                          • Figure 61: Attitudes towards improving the cinema experience, March 2010
                                                                                                                                                        • Cinemas need to keep pace with consumer expectations
                                                                                                                                                          • Not for kids
                                                                                                                                                            • Alcohol hits the spot
                                                                                                                                                              • Making a night of it
                                                                                                                                                                • ‘Filmathons’ capture the imagination
                                                                                                                                                                • Cinema Target Groups

                                                                                                                                                                  • Key points
                                                                                                                                                                    • Savvy Screenies
                                                                                                                                                                      • Perfectionists
                                                                                                                                                                        • Ambivalent
                                                                                                                                                                          • Figure 62: Cinema target groups, March 2010
                                                                                                                                                                        • Savvy Screenies heaviest cinema-goers
                                                                                                                                                                          • Figure 63: Frequency of visiting cinema, by target groups, March 2010
                                                                                                                                                                        • Perfectionists head quest for better hot drinks
                                                                                                                                                                          • Figure 64: Cinema improvements or innovations, by target groups, March 2010
                                                                                                                                                                      • Appendix – Cinema Visiting Habits

                                                                                                                                                                          • Figure 65: Frequency of visiting the cinema with a partner, by demographics, March 2010
                                                                                                                                                                          • Figure 66: Frequency of visiting the cinema with the family, by demographics, March 2010
                                                                                                                                                                          • Figure 67: Frequency of visiting the cinema with friends, by demographics, March 2010
                                                                                                                                                                      • Appendix – Attitudes Towards Cinema and Film

                                                                                                                                                                          • Figure 68: Most popular attitudes towards going to cinema, by demographics, March 2010
                                                                                                                                                                          • Figure 69: Next most popular attitudes towards going to cinema, by demographics, March 2010
                                                                                                                                                                          • Figure 70: Popular attitudes towards going to cinema, by demographics, March 2010
                                                                                                                                                                          • Figure 71: Other attitudes towards going to cinema, by demographics, March 2010
                                                                                                                                                                          • Figure 72: Least popular attitudes towards going to cinema, by demographics, March 2010
                                                                                                                                                                          • Figure 73: Attitudes towards going to cinema, by most popular frequency of visiting with a partner, March 2010
                                                                                                                                                                          • Figure 74: Attitudes towards going to cinema, by least popular frequency of visiting with a partner, March 2010
                                                                                                                                                                          • Figure 75: Attitudes towards going to cinema, by most popular frequency of visiting the cinema with the family, March 2010
                                                                                                                                                                          • Figure 76: Attitudes towards going to cinema, by least popular frequency of visiting the cinema with the family, March 2010
                                                                                                                                                                          • Figure 77: Attitudes towards going to cinema, by most popular frequency of visiting the cinema with friends, March 2010
                                                                                                                                                                          • Figure 78: Attitudes towards going to cinema, by least popular frequency of visiting the cinema with friends, March 2010
                                                                                                                                                                          • Figure 79: Attitudes towards going to cinema, by most popular attitudes towards going to cinema, March 2010
                                                                                                                                                                          • Figure 80: Attitudes towards going to cinema, by next most popular attitudes towards going to cinema, March 2010
                                                                                                                                                                          • Figure 81: Attitudes towards going to cinema, by popular attitudes towards going to cinema, March 2010
                                                                                                                                                                          • Figure 82: Attitudes towards going to cinema, by other attitudes towards going to cinema, March 2010
                                                                                                                                                                          • Figure 83: Attitudes towards going to cinema, by least popular attitudes towards going to cinema, March 2010
                                                                                                                                                                      • Appendix – Attitudes Towards Improving the Cinema Experience

                                                                                                                                                                          • Figure 84: Most popular cinema improvements or innovations, by demographics, March 2010
                                                                                                                                                                          • Figure 85: Next most popular cinema improvements or innovations, by demographics, March 2010
                                                                                                                                                                          • Figure 86: Other cinema improvements or innovations, by demographics, March 2010
                                                                                                                                                                          • Figure 87: Cinema improvements, by most popular frequency of visiting the cinema with a partner, March 2010
                                                                                                                                                                          • Figure 88: Cinema improvements, by least popular frequency of visiting the cinema with a partner, March 2010
                                                                                                                                                                          • Figure 89: Cinema improvements, by most popular frequency of visiting the cinema with the family, March 2010
                                                                                                                                                                          • Figure 90: Cinema improvements, by least popular frequency of visiting the cinema with the family, March 2010
                                                                                                                                                                          • Figure 91: Cinema improvements, by most popular frequency of visiting the cinema with friends, March 2010
                                                                                                                                                                          • Figure 92: Cinema improvements, by least popular frequency of visiting the cinema with friends, March 2010
                                                                                                                                                                          • Figure 93: Cinema improvements or innovations, by most popular attitudes towards going to cinema, March 2010
                                                                                                                                                                          • Figure 94: Cinema improvements or innovations, by next most popular attitudes towards going to cinema, March 2010
                                                                                                                                                                          • Figure 95: Cinema improvements or innovations, by popular attitudes towards going to cinema, March 2010
                                                                                                                                                                          • Figure 96: Cinema improvements or innovations, by other attitudes towards going to cinema, March 2010
                                                                                                                                                                          • Figure 97: Cinema improvements or innovations, by least popular attitudes towards going to cinema, March 2010
                                                                                                                                                                      • Appendix – Cinema Target Groups

                                                                                                                                                                          • Figure 98: Attitudes towards going to cinema, by target groups, March 2010
                                                                                                                                                                          • Figure 99: Cinema target groups, by demographics, March 2010

                                                                                                                                                                      Companies Covered

                                                                                                                                                                      • Aldi Stores Ltd (UK & Ireland)
                                                                                                                                                                      • Asda Group Ltd
                                                                                                                                                                      • Barclaycard
                                                                                                                                                                      • Ben & Jerry's (UK)
                                                                                                                                                                      • British Board of Film Classification
                                                                                                                                                                      • British Film Institute
                                                                                                                                                                      • British Sky Broadcasting Group plc (BSkyB)
                                                                                                                                                                      • British Video Association (BVA)
                                                                                                                                                                      • Cinema Advertising Association
                                                                                                                                                                      • Cineworld
                                                                                                                                                                      • Co-operative Group
                                                                                                                                                                      • Coca-Cola GB
                                                                                                                                                                      • Federation Against Copyright Theft
                                                                                                                                                                      • Fédération Internationale de Football Association
                                                                                                                                                                      • Gfk NOP
                                                                                                                                                                      • Government Actuary's Department (GAD)
                                                                                                                                                                      • HBOS plc (Halifax Bank of Scotland)
                                                                                                                                                                      • HSBC Private Bank (UK) Limited
                                                                                                                                                                      • IMAX Corporation
                                                                                                                                                                      • J. Sainsbury
                                                                                                                                                                      • Kantar Media
                                                                                                                                                                      • Lidl (UK)
                                                                                                                                                                      • Marks & Spencer
                                                                                                                                                                      • mmO2 plc
                                                                                                                                                                      • Momentum Pictures
                                                                                                                                                                      • National Amusements Inc.
                                                                                                                                                                      • Odeon Cinemas
                                                                                                                                                                      • Ofcom
                                                                                                                                                                      • Office of Fair Trading
                                                                                                                                                                      • Pizza Hut
                                                                                                                                                                      • Sports Industry Research Centre
                                                                                                                                                                      • Starbucks Coffee Company UK Ltd
                                                                                                                                                                      • T-Mobile (UK) Ltd
                                                                                                                                                                      • Tesco Plc
                                                                                                                                                                      • UK Film Council
                                                                                                                                                                      • United Cinemas International (UK) Limited
                                                                                                                                                                      • Virgin Media Ltd
                                                                                                                                                                      • Virgin Mobile
                                                                                                                                                                      • Vodafone Group Plc (UK)
                                                                                                                                                                      • Waitrose
                                                                                                                                                                      • Walt Disney Company, The
                                                                                                                                                                      • Wm Morrison Supermarkets

                                                                                                                                                                      Cinemas - UK - June 2010

                                                                                                                                                                      £1,995.00 (Excl.Tax)