Showing Off Our Attributes: John Fithian finds renewed confidence amongst NATO membership

Cinemas Features

“The improvement in the cinema experience continues to accelerate,” observes NATO president and chief executive officer John Fithian. Those enhancements include “top technologies for sight and sound, and luxury seating rolling out at a very fast pace, at least in North America, and now spreading to Europe and elsewhere,” he notes. Innovations in online ticketing “like social ticket buying through new apps and new services” are another hotbed of development. “The general choices given to our consumers are very high-end, as is the experience… When you combine great new experiences with people who may have not been to the movies for a while, coming out for big gigantic movies like Star Wars, you get an added bump.”

Those guests who have experienced the new and improved offerings, Fithian explains, are likely to come back again, and more frequently. “So, those two things work together. Improvements and experience combined with the record box office last year means that we are showing off our good new attributes to a lot of moviegoers.”

Another one of those showoffs is Deadpool, of course. Does he believe that Star Wars fans actually came back to see the foulmouthed Marvel man? “Absolutely,” but Wade Wilson was not alone, Fithian reasons. “While some had predicted it to be soft, the entire first quarter is turning out to be pretty strong. I think that shows a couple of things. People did come to our cinemas in record numbers in 2015 and they decided to come back in early 2016. It also shows that our partners at the studios are distributing big movies during all 12 months of the year. And it shows that you never know what is going to happen until people start buying tickets, right?”

It is reassuring to see the discussion expand from successful films to the actual experience of watching them in the movie theatre. “You have to have both for the theatrical industry to be strong,” Fithian asserts. “We can design the best cinema in the world and if the movies stink, no one would come. Conversely, the best movie exhibited in a really rundown movie house is not going to do as well as if it were run in a modern state-of-the-art complex. So we have always maintained it takes good movies and it takes a good moviegoing experience to really grow the marketplace. That’s what happened in 2015, both domestically and globally.”

Admissions are up around the world, he elaborates, though box office was hurt by market forces. “Last year was a record-breaking year globally,” Fithian observes, “[but] It would have been even bigger had it not being for currency devaluations. We would have clearly been over $40 billion for the first time ever… Nonetheless, the number of admissions was very, very strong.”

There is major theatrical growth everywhere, he says, naming places like China and Asia and Latin America in particular. “That is important for two reasons. Our members are building theatres all around the world, for one. This also gives better results for the studios to continue making their movies. As the DVD market continues to decline and as the home market has its challenges, theatrical is strong and growing. So we are more important in the minds of the studios and in the financial picture. And that is good for us.”

With that comes a challenge, at least domestically. “As the global marketplace expands so tremendously,” he continues, “the temptation of major moviemakers is to shoot for the globe every time in the themes of their movies. So we have a greater concentration of blockbusters making billions of dollars globally. Yet we still need a domestic market for film in United States. Many other countries have a domestic market that works for their own homegrown films. We too still need movies that appeal to U.S. audiences that don’t necessarily appeal to the globe. That’s another trend that we are looking at as an industry association.”

On the organizational front, NATO is moving with the times as well. With a new key hire in Phil Contrino, formerly of Boxoffice Media, as the organization’s data and research manager, “we are definitely going after data in a bigger way.” Fithian says this move “reflects how important data is to the future of any business and particularly to ours.” Exhibition has come a long way already, he finds. “Five years ago, we didn’t know much at all about our patrons. They came, they bought a ticket; maybe they bought a soda and some popcorn. But we didn’t have any idea who they were. Today, through loyalty programs and other data-tracking programs, we are gaining a much better sense of who our customers are. The demographics include what movies they like to see, what is their favorite candy brand. Our data is becoming more and more important to targeted marketing to give people information about what they want to see as opposed to just across-the-board marketing. We need to do a lot more of that.”

Data in every form is important, he continues. “Data about our customers, data about windows, data about what are the amenities that exist in cinemas today, so that we can talk…about what we have to offer.” While individual companies know their inventories of 3D screens, premium seating and the like, “there is no industry-wide collection of that data.” Going forward, however, the hope is to know the infrastructure. “We want to be able to tell our consumers more broadly what amenities we have and, by collecting that data, we are going to do just that.” Does that mean we will finally track attendance? (Rather than calculating admission numbers based on average ticket pricing, which Fithian agrees to be the “roundabout way.”) Having factual admission numbers “would be another element of good data. So these are all things that we are contemplating.”

One thing that data has told us already is the relative stability of ticket pricing. Fithian never tires of reminding everybody how this industry is doing “a really good job of keeping our experience affordable for our patrons. Each year I say in these interviews that if you take the last four decades and extrapolate for the cost of inflation, our ticket prices have gone up slightly less than the cost of inflation. To me that is really attractive to our consumers, especially considering the fact that the cinema experience has improved tremendously over those 40 years.” Fithian goes down the list that includes digital projection and sound, 3D, multiple showtimes, stadium seating, expanded food items, more concession choices, IMAX and premium large format, and high-end luxury offerings. “You factor all of those things in and ticket prices still have mirrored or been slightly less than inflation.”

Mr. Fithian sounds like a happy man. “Very,” he insists. “Whether you listen to the quarterly conference calls of our publicly traded companies or if you just go onto Main Street and talk to small cinema operators, you will hear a level of confidence. While that is not necessarily new, maybe it is reassuringly back,” Fithian has observed. “Our members are feeling confidence, not just from the record numbers. It is also about the reassurance that—despite every new wave of technology for the home—the theatrical experience seems to keep coming back and stay relevant to consumers. Our members are feeling confident,” he reiterates.

But surely, there must be something that aggravates John Fithian. “I don’t have anything that is a complete negative,” he replies. (This conversation was conducted before the debate about “The Screening Room” erupted.) “I have factors that are both good and bad,” he volunteers a few examples. “We shouted out from the mountaintops for years that there are 12 months in the calendar; that we are open 365 days a year and paying our staff and paying for our lighting; that we would love to have good movies in all 12 months. There is some very good news on this question and then also some challenges.” On the positive front, “we are seeing superhero movies in off months. Deadpool was the first example, a gigantic February release, breaking all kinds of records. Batman v Superman is in March, Suicide Squad in August. Doctor Strange in November. None of them come out during May, June, July, December—hot months that you typically see the superhero movies in—and yet we have a few superhero movies there too. My point is: These blockbusters are spread out. That’s good news and something we have been championing for a long time. At the same time, there are other types of movies that are not spread out.”

A case in point, “prestige movies that appeal to adults and to older crowds” generally come out at the end of the year for Oscar consideration. Fithian names an ally. “Harvey Weinstein has talked about this publicly, and others. We would like to see a way of getting those movies spread out over the 12 months, because they appeal to a very important part of our audience.” The same holds true for family titles, not to mention the March deadlock of faith-based films, where he opines that there is still some clustering. In other words, while “there is progress made on this so-called 12-month calendar, we would like to see continued progress in spreading movies out.”

“Another good news/bad news story” is having a variety of content for diverse audiences. “We have preached about this for years too,” he says, mentioning CinemaCon. “In 2015, a big theme of ours was women and film, the year before that it was African-Americans. We have talked about how important Hispanics are as a moviegoing population, particularly in the United States. And, yes, we have seen some progress in movies reflecting more of the diversity of the world… Diverse content, diverse actors, diverse messaging is good, just like good movies in every month of the year are good. We have made progress on both of those, but we have ways more to go.”

Does that mean we may welcome Chris Rock to CinemaCon 2016? “I realize diversity is a hot topic right now because of the Oscars, but it is something that NATO has been talking about for years. We were talking about diversity before it blew up in the stratosphere of news,” Fithian states. “It is not just a feel-good issue. This is about selling more tickets. This is about the bottom line. When people can see role models up on the screen, [they] relate better to movies.”

An issue that bugs this author about the Academy Awards is the fact that exactly one sole Oscar winner thanked the audience of moviegoers this year. Is that something we have to worry about? Do people forget about movies in theatres? “In previous years I counted,” Fithian recalls. “We’ve had some years when three or four or five different speakers talked about movie patrons and the theatrical experience, but we didn’t get much of that this year.” Nonetheless, he goes on to praise filmmakers. While Fithian discussed this in conjunction with the Academy Awards, his observations could readily apply in the current debate about The Screening Room as well. “We are very, very much in touch with the creative community and we know how strongly most leading directors and producers and actors believe in the big-screen experience. This is an art form for them and they want their work seen in the best possible way—on the big screen and with the best sound.” Equally important, if not more so, he knows how creators cherish the social experience that cinema provides: the experience of sharing stories, making them come to full life. “We are not worried about the creative community not supporting the theatrical experience at all,” he reassures our readers. “I just think the ceremony was so caught up in the diversity controversy there wasn’t really time to talk about much of anything else.”

What is Fithian going to talk about during the next big industry celebration? “I would say that our confidence in 2016 and beyond is reflected in our program at CinemaCon,” he responds. “We have eight major presentations from different studios this year. As a brand-new player on the stage, STX Entertainment has its first big presentation ever at CinemaCon. Lionsgate is back and all of the major studios have significant presentations”—which Fithian sees as a sign that they have confidence in their product. “And that excites our people. I think our registration numbers are going to be the best ever this year, which suggests that our members are doing well and want to come and learn more about product and technologies, so they can keep growing their business. The convention itself—in terms of who is presenting and who is coming—reflects confidence in the business.”