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.