In this week’s Five on Friday feature, we look at movie theatres and how they might fare if they don’t consider alternative revenue sources (e.g., streaming, movie subscriptions); Peacock’s overnight success, signing up 10 million viewers in just two weeks; and a status update on major brands’ ad boycott of Facebook last month. Also this week, we’ll look at how consumer finances are changing in 2020, and LinkedIn shares five top subscription jobs.
Movie Theaters Need to Look Beyond Ticket Sales for Survival
In a recent column for Forbes, contributor Mark Hughes said that movie theaters will die if they don’t embrace subscription services. COVID-19, of course, has played a significant role in that theory. While year-over-year movie theater attendance tends to increase, Hughes said that younger generations tend to watch content at home or on their mobile devices. Also, higher ticket prices impact how many films they are willing to see in a theater. And now, of course, safety plays a major factor and theaters slowly reopen.
Hughes believes that subscriptions can help save movie theaters by offering subscribers package deals for a set monthly fee. The subscription might include access to new releases, rereleases and reruns of classic films.
“Smaller theaters complexes with less screens, where screens have less seating, mostly automated ticketing and concessions, and “subscriptions” to see multiple films per month for a single price, will allow theaters to compete better in the changed landscape ahead of us. The smaller spacing and automation help reduce overhead significantly, and theaters could regularly screen season-opener episodes of the most popular streaming shows to boost attendance and create further merger — literally and perceptually in the minds of viewers — of theatrical and home experiences,” said Hughes.
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AMC Theatres, an entertainment holding company that has embraced subscriptions, is among the theater chains so badly hit during the pandemic. In the company’s second quarter financials, released yesterday, AMC reported that this was the company’s most challenging quarter in the company’s 100-year history. Their revenue for the quarter was $18.9 million, compared to $1.5 billion for the same period last year – a 98.7% decrease! The company sustained a $561.2 million loss for the quarter. Those numbers are just heartbreaking, but not surprising.
There is good news on the horizon though. AMC signed an agreement with Universal Studios which will generate revenue for AMC whether consumers watch films in the theaters or in their homes. AMC is having similar discussions with other studios to reach similar agreements.
“A once in a century event has transformed 2020 into a brutal year, and movie theatre businesses have been hit particularly hard. Even so, as we look ahead, we remain optimistic about AMC’s long term future. Theatrical exhibition has always been resilient, and we are confident that at AMC we are taking the right steps to emerge from this crisis and to thrive once again as the leader in our industry,” said Adam Aron, CEO and president of CEO, in an August 6 news release.
Prior to the pandemic, AMC launched two different subscriptions as extensions of their loyalty programs. The AMC Stubs A-List is their premium subscription product. It includes access to up to three movies per week, in any format including IMAX and Dolby Cinema. Prices vary by location. In addition, AMC has an AMC Stubs Premiere subscription which is an annual subscription that provides members with exclusive deals, specials and offers, including savings on drink and popcorn upsizing, waiver of online ticketing fees and additional points and perks. These subscriptions have been paused during the pandemic.
AMC had also launched on demand movies which can be rented or purchased. The subscriptions and on demand movie options provide AMC with some additional revenue, but based on second quarter financials, the company really needs theaters to reopen before their bottom line will look anything close to normal.
NBCUniversal’s Peacock Attracts 10 Million Sign-Ups in First Two Weeks
Following a soft launch to Comcast Xfinity customers in April, NBCUniversal’s streaming video service Peacock officially premiered on July 15. The service has already attracted 10 million sign-ups, according Jeff Shell, CEO of NBCUniversal/Comcast in a July 30 earnings call. It is not clear how many of those viewers are watching the free version or one of the two paid subscription options, Peacock Premium and Peacock Premium Plus.
“…not only are more people signing up than we projected, but they are watching more frequently and engaging much longer than we projected,” said Shell. “The technology worked seamlessly, and the service is improving on a daily basis. With much of our strong programming coming in January, including the exclusive rights to The Office, we feel very encouraged.”
Shell explained later in the call that these 10 million viewers are sign-ups, which are not the same metrics as monthly active accounts (households) or monthly active users (individuals). In the future, the company plans to measure success by monthly active accounts, but they don’t have enough data to tally that information.
“We didn’t expect this many sign-ups. We didn’t expect people to come back as frequently as they’re coming back. And we didn’t expect people to watch as long as they’re watching once they come back,” said Shell. “So we’re very encouraged. It’s early days, but we’re very encouraged as we look forward on our Investor Day guidance.”
This early success is particularly impressive because Peacock had originally planned its launch to coincide with the 2020 Tokyo Summer Olympics, which were postponed until 2021 due to the COVID-19 pandemic. This is a great starting point for the service, even if many of the sign-ups are using the ad-supported version of Peacock. Those users may convert to access additional content, including Peacock Originals, which look pretty good.
Editor’s note: In the name of research, I signed up for Peacock through Comcast Xfinity. I watched the Peacock launch on July 15 with a special reunion episode of ‘30 Rock.’ It was largely promotional, but still fun to see my favorite characters from the show. I have also watched favorites like Dateline and one of the Peacock Originals which was well done. I am impressed so far.
Facebook Ad Boycott: Did It Make a Difference?
In July, more than 400 brands boycotted Facebook ads. The brands, along with select ad agencies, targeted the social media platform because of the company’s policies that allowed hate speech and hostile content (#StopHateForProfit). Major brands like Ben & Jerry’s, Birchbox, Coca-Cola, HP, Microsoft, REI and Starbucks were among the companies that put their money where their mouths were, refusing to advertise on Facebook for a month. Some including Microsoft, Unilever, Diageo, Coca-Cola and CVS are continuing to cut advertising dollars previously spent on Facebook, says Digiday.
For the second quarter of the year, Facebook had $18.7 billion in total revenue, an increase of 11% year-over-year. Of that total, $18.3 billion came from advertising, a 10% increase year-over-year, and $366 million from other revenue streams, a 40% increase over the same period last year. In the company’s July 30 earnings call, they said their ad revenue growth rate was on par with their second quarter growth of 10%. Facebook said they expect full quarter revenue for Q3 would be similar to the company’s ad performance in July.
During the earnings call, Facebook addressed the boycott, noting that certain advertisers had paused their spending. Sheryl Sandberg, chief operating officer, said she felt the situation with this boycott is different than previous boycotts of other companies where the two sides differed.
“We completely agree that we don’t want hate on our platforms, and we stand firmly against it. We don’t benefit from hate speech. We never have,” Sandberg said. “Users don’t want to see it, advertisers don’t want to be associated with it. And we’ve been working for a really long time to get better at this, to finding it.”
Facebook is working with civil rights organizations that are boycotting Facebook, a civil rights auditor, and the Media Rating Council to look at next steps. We’ll have to wait until the third quarter financials are released to see how advertising revenue was impacted and if the boycott's impact will continue through year end.
Fiserv Report: Consumer Finance Trends During COVID-19
COVID-19 has changed virtually every aspect of our lives, including how we spend money. To identify trends, expectations and experiences, Fiserv, Inc., a fintech and payments provider, conducted a survey in May with some fascinating results. One obvious result is that people are concerned about their money and about banking. Mobile deposits and contactless payments are up, while use of cash is down, reports Fiserv.
Here are a few other staggering statistics that put the pandemic, and people’s concerns, into perspective:
- 70% of consumers surveyed said they are concerned about the impact on their finances.
- Younger generations are more likely to have missed a bill or a rent or mortgage payment than older consumers.
- 8% of Gen Z consumers have missed a rent or mortgage payment and 18% expect to.
- 15% of Millennials have missed a rent or mortgage payment and 21% expect to.
- 67% of those surveyed said they expect their increased usage of mobile payment apps to be permanent.
- 33% percent said their usage of mobile payment apps has increased.
- When using a credit or debit card to pay, 50% or more insert their cards more than tap-and-pay, 27% use insertion and tapping equally, 22% tap more than insert, and 1% never pay with a debit or credit card.
- Once banks are more readily open, here is what consumers said about in-person banking.
For the complete report, visit Fiserv.com.
LinkedIn: Top Subscription Jobs
Director of Digital Subscription Growth
Albany, New York
Do you want to work in a fast-paced newsroom on the biggest stories in the Capital Region? Do you have a passion for audience development and local journalism? We’re looking for an ambitious, versatile leader with a combination of news and marketing skills to join the Times Union digital team. The Director of Audience will have experience in a senior leadership position in a newsroom or digital content company. We need a self-starter with high standards who can collaborate well, has excellent communication skills, and is ready to dig deep into content and readership analytics while devising strategies across platforms to help the Capital Region’s largest and most ambitious newsroom grow even more. The successful candidate will be at the forefront of innovation and their work will touch hundreds of thousands of readers every day. Read more.
Senior Manager, Editorial & News
San Francisco Bay Area
A day in the life of our Senior Manager, Editorial & News:
- Develop a team of hardworking managers and contractors, who create articles around the clock (and around the world) and program editorial priorities across site pages to millions of visitors. Mentor and develop employees to improve expertise across the team.
- Formalize and continuously update our editorial strategy in support of subscription, viewership, industry support and additional business lines (games, e-commerce, events).
- Align with Audience Development, Brand Management, Licensing and Public Relations teams on various cross-functional campaigns
- Lead all aspects of the development and design of our news platform and homepage programming elements working with product design and engineering.
- Establish and own important metrics for growth and revenue. Handle editorial budget.
- Partner with international leads to grow our news and programming impact across key languages.
Senior Manager, Internal Communications
We're looking for an Internal Communications Senior Manager to develop, plan and implement internal communications programs that keep employees informed and aligned with what's happening across the company. You will help leverage our unique, purpose-driven culture to continue inspiring our workforce and enabling them to amplify our products and brands. We are seeking candidates with expertise developing and executing world-class internal communications programs and interacting with employees and leaders at all levels. This role will report to the Senior Director of Employee Experience and will be responsible for working very closely with partners across the company to build comprehensive communications solutions that reach our digitally-native population. Read more.
Business Analysis Manager, Media Performance Insights
We are looking for a driven and analytical team member who is passionate about delivering business value – and determining how paid media investments can best deliver that value. You will conduct fast-paced analysis of cross-channel media performance across key marketing campaigns in driving high-quality prospective customers forward in the purchase funnel in our core lines of business and resulting in incremental enterprise value. You will regularly deliver and present to executive leadership actionable, data-driven recommendations that optimize T-Mobile's marketing efficiency and deliver business performance. Read more.
Social Media Manager, Apple TV+
Culver City, CA
We are looking for a Social Media Manager to join our rapidly developing Video business. We are seeking a passionate storyteller, strategic thinker, and skilled communicator with a track record of leading and growing social channels. A deep understanding of social voice, tone, style and creative is critical. This role requires a detailed understanding of tools, analytics and social technology as well as all native platforms (Twitter, Facebook, Instagram, Snapchat, Pinterest, YouTube, Tumblr and beyond). You demonstrate a clear ability to develop tactics and campaigns that drive the business goals; earned media, audience growth, owned engagement, acquisition, reach, churn mitigation and more. An in-depth knowledge of movies and TV and how to manage talent in that world is a must along with deep experience in entertainment specific social media. Read more.