Cinema advertising revenue tops $700 million for first time

Cinemas News

Coming off of a record year at the movies, the U.S. cinema-advertising industry has solidified its leadership position in the premium video category. According to new data unveiled by the Cinema Advertising Council (CAC), revenues for 2015 increased a substantial 13.4 percent year-over-year, with revenue among CAC members soaring to $716,436,000 in 2015, up from $631,902,000 in 2014.

The significant growth, according to the CAC, is attributable to Madison Avenue embracing the increasing value of cinema to reach consumers, compared with audience declines experienced by other major media categories. CAC members are continuing to make gains in market share through a variety of tactics, including a successful upfront sales strategy that includes presentations that take place alongside the leading broadcast, cable and digital networks, as well as initiating new data and technology initiatives that have also raised the appeal of cinema with brands and agencies—helping them to connect with consumers before, during and after the movie experience. Additionally, they have boosted the power of the medium through the integration of the latest digital and social media trends into the cinema environment.

The record-spending 2015 marked the first time the industry has topped $700 million and the sixth straight year over $600 million, bringing total cinema advertising spending to more than $7.31 billion since 2002, the first year the CAC began tracking revenue. 

“While Star Wars: The Force Awakens wrapped up 2015’s record year, nearly every weekend at the movies features event programming,” noted Katy Loria, CAC president and chairman. “This constant stream of tentpole titles attracts ratings that would be exciting for any video network on any sized screen, let alone the biggest and most dynamic screen in all of media, and delivers Millennial audiences whose consumption habits compared with past generations are different and elusive…except for the movies. Additionally, the momentum from 2015 has led to a strong first quarter this year—both at the box office, which is outpacing last year by more than 12 percent, and in cinema ad sales—and we are strongly positioned to see cinema become an even more essential part of media plans, with a seat at the table alongside other premium video media companies as upfront negotiations heat up.”

Also according to the 2015 CAC Revenue Report:

* National/regional sales, which made up 76.83 percent of all cinema revenue, grew 15.6 percent to $550,470,000 in 2015 from $476,275,000 in 2014;

* Local sales, which made up 23.17 percent of all cinema revenue, grew 6.6 percent to $165,966,000 in 2015 from$155,627,000 in 2014 (marking the sixth consecutive year of local sales growth);

* The leading cinema sales categories last year were (in order by revenue): Auto, Banking/Finance/Insurance, Consumer Electronics, Government/Education and Media;

* 215 new national or regional brands advertised in cinema in 2015, up from 121 new brands in 2014 and 93 new brands in 2013; and

* Top new sales categories included (in alphabetical order): Alcohol/Spirits, Colleges/Universities, Facial Make-Up Products, Sporting Goods Stores and Supermarkets.

The CAC Report is based on data independently tabulated by Miller, Kaplan, Arase & Co. LLP from CAC members, which make up approximately 90 percent of all cinema screens and box office admissions in the U.S.