Queuing up for Q3 at the box-office
The tradition of not releasing big films during the third quarter is fast changing. This year, Q3 has some of the biggest movies of the year in queue.
By Nandini Raghavendra, TNN |
The traffic snarls in Mumbai due to Diwali shopping have made headlines. With the capital markets reaching dizzying heights, zeros added to disposable incomes have only risen. One of the big beneficiaries of such spending is the film industry.
The industry is also witnessing a gradual shift in movie releases. While traditional release periods like summer, holidays, clean weekends with no other releases, Diwali and Eid are important, the pattern of releasing movies is changing. Yashraj’s Dhoom 2 is a case in point, which was released a week after Diwali last year.
So also is UTV’s Khosla ka Ghosla, released during the shraddh period, traditionally a non-release period. Even Guru released in January this year, in Q4. The pattern is driven by content today.
Of the $10-billion entertainment industry, the film industry is worth $2 billion. It is expected to grow to $4.3 billion by 2011, and the multiplex industry is expected to contribute in a big way. “As the multiplex industry keeps pace with the film industry’s growth, it demands content to fill the growing screens over the 52 weekends; content that’s new and varied and in keeping with the changing profile of the consumer.
This is why we are seeing a shift in release patterns,” says PricewaterhouseCoopers head, media and entertainment, Timmy Kandahari. “Today, if your content is good, it does not matter when you release the movie. Besides, there is the concern of rising interest costs and with big production budgets, film makers cannot afford to sit on movies, they need to release and get their return on investment.
All this has contributed to a healthier Q3 year-on-year, a trend which is going to increase over all quarters,” he adds. People Pictures CEO Aditya Shastri says it’s not about Diwali or Eid, but about getting the product right. “Black, Rang de Basanti, Dhoom2 and Guru are all cases in point, while David Dhawan’s Shaadi No 1 in 2005 or Salman’s Jaan-e-Man in 2006, both released on Diwali, tanked.
In fact, the next Q3 will be even bigger when Eid will be followed by Diwali, giving the industry two big holidays to release their films,” says Mr Shastri.
For Shravan Shroff of Shringar, it’s the result of corporatisation and having access to multiple financing options that has seen an increase in the quality and quantity of movies being produced. “Plus, the qualities of theatres also have improved, primarily in multiplexes.
Further, changes in consumer behaviour wherein quality movies are being released in non-peak seasons have shown great responses from patrons. Guru and Eklavya, both released in early 2007, did very good business at the box office,” says Mr Shroff.
The industry is also witnessing a gradual shift in movie releases. While traditional release periods like summer, holidays, clean weekends with no other releases, Diwali and Eid are important, the pattern of releasing movies is changing. Yashraj’s Dhoom 2 is a case in point, which was released a week after Diwali last year.
So also is UTV’s Khosla ka Ghosla, released during the shraddh period, traditionally a non-release period. Even Guru released in January this year, in Q4. The pattern is driven by content today.
Of the $10-billion entertainment industry, the film industry is worth $2 billion. It is expected to grow to $4.3 billion by 2011, and the multiplex industry is expected to contribute in a big way. “As the multiplex industry keeps pace with the film industry’s growth, it demands content to fill the growing screens over the 52 weekends; content that’s new and varied and in keeping with the changing profile of the consumer.
This is why we are seeing a shift in release patterns,” says PricewaterhouseCoopers head, media and entertainment, Timmy Kandahari. “Today, if your content is good, it does not matter when you release the movie. Besides, there is the concern of rising interest costs and with big production budgets, film makers cannot afford to sit on movies, they need to release and get their return on investment.
All this has contributed to a healthier Q3 year-on-year, a trend which is going to increase over all quarters,” he adds. People Pictures CEO Aditya Shastri says it’s not about Diwali or Eid, but about getting the product right. “Black, Rang de Basanti, Dhoom2 and Guru are all cases in point, while David Dhawan’s Shaadi No 1 in 2005 or Salman’s Jaan-e-Man in 2006, both released on Diwali, tanked.
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In fact, the next Q3 will be even bigger when Eid will be followed by Diwali, giving the industry two big holidays to release their films,” says Mr Shastri.
For Shravan Shroff of Shringar, it’s the result of corporatisation and having access to multiple financing options that has seen an increase in the quality and quantity of movies being produced. “Plus, the qualities of theatres also have improved, primarily in multiplexes.
Further, changes in consumer behaviour wherein quality movies are being released in non-peak seasons have shown great responses from patrons. Guru and Eklavya, both released in early 2007, did very good business at the box office,” says Mr Shroff.
The multiplex industry has seen numbers, screens, average ticket price, food and beverage sales and advertisements grow. “We began operations in 1997 in Mumbai’s Goregaon and in 2002, we had a turnover of Rs 20 crore,” says Cinemax vice-president, marketing and programming, Devang Sampat.
“This year, our six-monthly turnover stands at Rs 55 crore, with an occupancy of 42%, which has grown because the number of shows have increased from an average of four per day per screen to 5.5 shows across 42 screens. Our average ticket prices (ATP) have gone up from Rs 55 in 2002 to Rs 150 today,” he adds.
Inox, Fame, Fun and Adlabs report ATP going up at least by 12-15%. Adlabs COO Tushar Dhingra says next year, the trend will be different as all the big players from Yashraj and UTV to Adlabs have planned big releases.
PVR vice-president, finance, Nitin Sood says the bottomline for Q3 can only swell. “Veer Zaara started the trend in 2004, which came along with the big Diwali and Eid weekend. Then there were Mughal-e-Azam and then Don and Jaan-e-Man and what was traditionally a slower quarter began picking up,” says Mr Sood.
“We have a pretty neat line-up for Q3 this year with Om Shanti Om, Saawairya, YRF’s Aaja Nachle, Aamir Khan’s Tare Zameen Pe, UTV’s Goal, Khoya Khoya Chaand, Halla Bol and Welcome,” he adds.
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He predicts that we are moving towards a 365-day entertainment year. People are redefining what a good and bad period is. “One week before Diwali was the leanest period and now we have had releases like Jab We Met that hit the purple patch,” adds Mr Sood. He says ATPs have gone from Rs 80-90 five years ago to Rs 150-plus now, with average occupancies at 40-45%.
Pop Hit
Whatever the story or quarter, pop corn is always a huge hit. So while the movies add to the swelling Q3, the F&B — from soft drinks to samosas and sandwiches — has been selling faster than the queue can move at the box office window.
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“We are a pure vegetarian chain yet, from an initial 15% five years ago, today F&B contributes 22% to our overall revenue and this is important as margins on food (done in-house) are as high as 65%,” says Sampat of Cinemax. For Shroff, it has grown from 17% last year to 20% this year while Kapur says F&B sales form 30% of his ticket revenue at Fun.Pop goes the corn
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Movies without popcorn are like a movie without stars. And the food and beverage bill has kept the machines popping corn in larger and larger numbers. No prizes for guessing while watching Shah Rukh Khan goad his team to win the World Cup in Chak De, what was the most consumed food? An average of 45-55% of all food has been popcorn with a combination of a Pepsi or a Coke. So, whatever quarter it is, this sale is one which remains steadfast.
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