The Avalon Group, which owns the CineCentre cinema chain, is confident in the industry’s future in South Africa despite the country’s challenging trading conditions.
CEO AB Moosa said the cinema chain offers highly competitive pricing and various deals included in its ticket prices, setting it apart from other players in the industry.
Regarding the challenges faced by major players like Ster-Kinekor, where the company has been forced to restructure and cut jobs to reduce costs, Moosa says these are company-specific and do not apply to CineCentre.
“Having been in the industry for 85 years, the Avalon Group has encountered numerous challenges over the decades and has successfully addressed these with a long-term vision,” he said.
“Certainly, trading conditions for retail in general are challenging, particularly due to inflation and a stressed consumer market, our CineCentre cinemas remain on a stable trajectory.”
Moosa explained that CineCentre offers highly competitive pricing with an “unparalleled reward offering”, including discounts on various products through partner companies.
“Included with each movie ticket and each refreshment purchase are a variety of discounts for everyday essentials like food, groceries, clothing, leisure activities, educational platforms, travel, and many more,” he said.
Moosa said CineCentre’s reward discounts far exceed the value of a ticket or of snacks and drinks at its movie theatres.
“This is available to anyone; the moment you buy you win — no membership subscription to us or any third party is required,” added Moosa.
CineCentre also has Budget Tuesdays offerings, which Moosa says has proven very popular among its customers.
On Tuesdays, ticket prices range from R50 for 2D tickets to R60 for 3D movies. These also come with a variety of awards and no membership requirements.
Ster-Kinekor and Nu Metro have highlighted load-shedding and the Hollywood strikes as significant contributors to declining audience numbers in South Africa.
However, Moosa said all of CineCentre’s sites are equipped with generators to ensure customer experience at its cinemas isn’t compromised.
Regarding the Hollywood strikes, he said the scarcity of content has a limited short-term impact on CineCentre.
“Even during the protracted Hollywood actors’ strike, which has long since ended in November 2023 and resulted in some release delays by a few months, there were still sufficient movies to offer customers regular options,” said Moosa.
“We also have a great slate of films releasing from this month onwards.”
Moosa said CineCentre diversifies its offerings to accommodate customer needs, and is looking to expand these offerings.
This includes screening sports events, hosting conferences and private events, birthday parties, and even marriage proposals.
“We are also working on e-sports events at our cinemas, amongst other initiatives,” said Moosa.
Ster-Kinekor and Nu Metro have both attempted to use e-sports to fill empty theatres. Following its recent retrenchments, Ster-Kinekor said it was once again exploring PlayStation gaming on its big screens as an option.
Ster-Kinekor recently retrenched 52 staff members and closed two cinemas through a restructuring effort to help reduce costs.
While the final job cuts were significantly less than anticipated, the fact that the company is cutting jobs and closing cinemas is out of sync with global trends in the industry.
“We initially assessed that 226 jobs might be affected. However, we ended up retrenching just 52 employees, and these were largely head-office based,” said Mark Sardi, Ster Kinekor CEO.
“A positive outcome in that we managed to mitigate the overall impact on headcount.”
Some good news is that the global cinema market continues to grow despite several challenges, including the rise of streaming.
The latest data projects that the global cinema market’s revenue will reach $85.16 billion in 2024.
This growth is set to continue at 5% annually, reaching a projected market revenue of $109.4 billion by 2029.
The number of cinema viewers is expected to reach 1.9 billion by 2029. This means the cinema industry is thriving globally.