Cinemas are still a new frontier for Gulf advertisers

People pay more attention to commercials and attendance is rising

September 11, 2024, 9:49 AM

The lobby of a new cinema in Saudi Arabia. Cinema audiences in the Gulf region are young with high disposable income

In August Saudi Arabia’s tourism board released its latest campaign, ‘This Land is Calling’, created by the French ad agency BETC.

The advert follows a female adventurer in a sci-fi setting reminiscent of the recent blockbuster Dune movies.

It will run across multiple media channels and its scale and style are particularly cinematic, suggesting it has been planned to look good on the big screen in key markets across Europe and North America.

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But is cinema advertising still relevant in the digital age?

The movie market took a big hit during the 2020 Covid-19 pandemic. During lockdown cinemas around the world recorded revenues of zero for the first time in history.

By May of that year GCC cinema chains, normally rivals in the quest for customers, had come together to launch an ad promoting the cinema experience, called #BetterAtTheMovies.

Of course, audiences have since returned. The data-gathering platform Statista forecasts GCC cinema spend will reach $1 billion in 2024, followed by a compound annual growth rate of 4.6 percent to $1.26 billion in 2029.

This spend includes box office takings and advertising, which make up roughly equal amounts, and concessions revenue, which makes up less than 10 percent of the total.

Higher box office takings normally lead to higher ad spend on cinema. More people watching films means more people seeing the ads that run before them.

Cinema is popular in the GCC for many reasons. The region has a young population with high disposable income, for whom cinema is an attractive way to spend time out of the house, especially given the hot climate and paucity of outdoor entertainment options.

In addition, developers in the region have been investing in high-tech and luxury cinema facilities in malls and entertainment hubs, not least in Saudi Arabia, where cinemas were banned for 35 years, until 2018.

The kingdom has the same driving factors for cinema attendance as in the rest of the GCC, but it is coming off a small base. It now has 66 cinemas, with 618 screens and 63,000 seats across 22 cities.

When the reintroduction of theatres was initially announced, the government said it hoped to exceed 300 locations with more than 2,000 screens by 2030, so there is much room for growth.

Attendance and takings may be rising, but box office numbers are not the only way to measure the success of cinema, particularly for advertisers.

In 2022 the regional cinema advertising company Motivate Val Morgan, which sells advertising for cinema chains including AMC, Muvi, Reel and Vox, launched tools to allow advertisers and their agencies to plan and measure cinema campaigns based on audience numbers, demographics and income groups.

This addressed concerns about the targeting of cinema ads, as advertisers seek more granularity and transparency about the reach of their messaging.

Recent research from the US ad network Screenvision Media has used facial recognition to study the effectiveness of cinema ads, based on the amount of attention people pay to them.

Screenvision's senior vice-president of insights and measurements, Jennifer Friedlander, said: “Cinema averages an 84 percent active attention to ads, versus TV, or even CTV [connected TV, meaning digital services such as Netflix], where that number is about 30 percent.

"That’s a difference of 26 seconds of a 30-second ad being actively watched in the cinema environment versus only about nine or 10 seconds of a 30-second ad being watched on linear or CTV.”

Younger audiences, aged 18 to 34, even put their phones away, and pay more attention than the over-35s.

The report also found that commercials made for TV platforms perform as well as more cinematic ads created for the big screen. In other words, the setting is more important than the content.

This is good news for GCC brands, whose ads will be shown in high-tech and luxury cinemas offering features such as plush seating, 3D screens and Imax auditoriums.

So, while the cinema advertising market may remain small in comparison to other categories (as little as half a percentage point of monitored ad budgets by some estimates), it is likely that overall spend on cinema will continue to rise in the GCC, and cinema will continue to prove an effective, if small part of brands’ marketing mix.

Austyn Allison is an editorial consultant and journalist who has covered Middle East advertising since 2007