Cinema Advertising Topped $750 Million in 2016

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Sat, 04/01/2017 - 16:53 -- Nick Dager

Coming off of a record year for the movies, the U.S. cinema advertising industry continues to thrive and reinforce its position as the ultimate premium video offering, with revenue topping $750 million for the first time. The Cinema Advertising Council said 2016 revenue increased 5.8 percent year-over-year, with revenue among CAC members climbing to $758,320,000, up from $716,436,000 in 2015.

According to the CAC, the sector’s continued push towards creating value for advertisers through creative on-screen storytelling, technology integrations and campaign measurement advances has led to another incredible year of growth. As other major media categories experience audience decline, cinema continues to show its unrivaled value and impact within the media mix by delivering a highly concentrated scale of the coveted millennial audiences every week of the year.

This record-spending year marked the seventh straight year with revenue topping $600 million, bringing total cinema advertising spending to more than $8 billion since 2002, the first year the CAC began tracking revenue. The CAC also reported more than $162 million in local sales for 2016, noting that with over 4,000 physical theaters across the country, the cinema advertising industry was well positioned to serve the influx of Main Street advertisers.

In addition, in 2016, the CAC joined the Video Advertising Bureau, and has collaborated on research that highlights cinema’s role in the video advertising landscape, including a recent report, Lights, Camera, Call to Action!  The Driving Forces Behind Cinema Advertising.

“We just closed out another terrific year for cinema and saw our industry revenue climb to the highest it’s ever been. Among national, regional and local advertisers, cinema has proven time and time again to be an essential component to media plans,” said Katy Loria, CAC president and chairman. “Cinema is a proven high impact source for audience replacement, and supplements and enhances the audience lost through ratings erosion on broadcast and cable TV.”

“In a marketplace where attention is the new ROI and engagement is the new currency, our unrivaled impact across ad recall, brand consideration and purchase intent is resonating at very high levels,” continued Loria. “Being able to deliver that kind of scale and impact continuously throughout the year has been a major factor in our continued growth. The momentum and increased interest in cinema advertising has continued in 2017, which has been buoyed by a robust box office, with seven movies grossing more than $100M each in Q1 2017 alone. We are very excited about how this positions cinema for the upcoming media upfront season.”  

Also according to the 2016 CAC Revenue Report:

National/regional sales, which made up 78.5 percent of all cinema revenue, grew 8.2 percent to $595,501,000 in 2016, up from $550,470,000 in 2015

On-screen revenue totaled $706,831,000 in 2016, up from $670,365,000 in 2015, representing a 5.4 percent year-over-year increase

Off-screen revenue saw double-digit growth, climbing to $51,489,000 in 2016, up from $46,071,000 in 2015, representing a 11.8 percent increase

The top five cinema sales categories in 2016 were: Entertainment, Automotive, Communications, Internet & Media, and Computer Hardware/Software

276 new national or regional brands advertised in cinema in 2016, up 28.3 percent from 215 new brands in 2015 and 121 new brands in 2014

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. In addition to accounting for National/Regional and Local sales, the report measures both on- and off-screen revenue.

The Cinema Advertising Council