Case Study Movie Exhibition Industry Essay - 1529 Words

Strategic Analysis of Movie Exhibition Industry By: Kim Saline February 24, 2010 Objective: To provide an analysis and make recommendations to increase revenue in the movie exhibition industry. Overview: Ticket sales for movie theaters are at their lowest point since 1996. With the core demographic group expected to grow slower than the US population and with technological advances growing at speeds faster than the industry can keep up, ticket sales will continue to decline if the current business strategy continues to be followed. Concession sales and ticket sales are the two biggest sources of revenue for a movie theater. Both continue to increase in cost to the consumers and may have reached a price point that is starting†¦show more content†¦They also initiate the contracts with the theaters and negotiate the percentage of box office sales they will receive. Many of the distribution companies are integrating with the production studios because the need for distribution is diminishing with the conversion to digital. This makes these suppliers a strong force. On the concession side the bargaining power is weak due to economies of scale. Theaters earn most of their profits on concessions so they use their power to reduce their costs from their suppliers. 4. The bargaining power of buyers: The outlook for the target market isn’t favorable for the movie industry because it will not be growing as fast as the overall population. Buyer power is a strong force because of the target market and several other factors including: the undifferentiated product offered, switching to an alternative is simple and low cost, and customers can stay home and watch movies. The consumers are also complaining about concession and ticket costs, along with the advertisements before the film is shown. 5. The threat of substitutes: This is the strongest force of competitive pressure that the movie exhibition industry faces. Not only are they competing among each other but they have to compete with every leisure activity a consumer has to choose from. Consumers are also investing in home theaters. TV’s are bigger than ever and have digital and 3D capability. As the costs of all the components go down consumers areShow MoreRelatedCase Study – The Movie Exhibition Industry2267 Words   |  10 Pagesï » ¿ [Header] Case Study – The Movie Exhibition Industry 1 Case Study: â€Å"The Movie Exhibition Industry† Strategic Planning - BS400 October x, 2013 Overview/Introduction My analysis will cover competition from substitutes and the change in buyer behavior and demographics. I will use the five forces model of competition and a SWOT analysisRead MoreFilm and Movie Industry1612 Words   |  7 PagesExam Case Study Fall Semester: 2012 / 2013 The Movie Industry in 2008 (Case A amp; B) MBA Student: Waseem Hasan Ismail Submit to: TAGSB Administration 27 February 2013 Table of Contents Introduction 3 The Movie Industry in 2008 (Case A) 4 PESTEL Analysis – External Environmental 4 Porter’s five Analysis 4 Profitability Model for movie theaters 4 Key strategic issues facing movie theaters 4 Strategic actions that exhibitions might consider 4 The Movie Industry in 2008 (Case B)Read MoreDigital Convergence Impact On The Film Industry1410 Words   |  6 PagesThere has been an extreme advance in media technology, especially that used in film industry. This includes the creation of analog-to-digital converters, technology convergence, and the changes in the media industry and audiences. 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INTRODUCTION With the support of several government agencies, Singapore, predominantly an import exhibition market has ambitious plans to develop its film and cinematic capabilities over the next decade (Singapore Media Fusion, accessed 21 May 2010). The local cinema goer has become more discerning as consumer expectations remain high. Patrons are nowRead MoreMovie Exhibition 2013 Avengers6511 Words   |  27 PagesRead the Case Study and answer the following questions: †¢ What changes in the external environment put companies in the difficult position in this industry? Support your answer by conducting PESTEL and Five-Forces Analyses. †¢ How could a company operating in this industry react to the identified challenges? †¢ How does the structure of the industry affects profits? 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