Silver screen: Seven decades of Pearl & Dean

Ernie and Charles Pearl

With its famous theme tune it is one of the most recognised media brands in the UK, but is Pearl & Dean ready for the future? Ellen Hammett looks at how the cinema advertiser is embracing change

It’s been 64 years since Pearl & Dean started selling advertising on British cinema screens.

Perhaps best-known for its distinctive theme tune, it is one of the UK’s two remaining cinema advertisers that together operate in an industry that drew in £1.25 billion to the UK box office last year with more than 160 million admissions.

Despite this, cinema still only accounts for 2% of advertiser budgets, and the rise of digital means the advertising landscape is a very different place now compared to when cinema and TV were the only media for brands to show audio-visual content on.

Pearl & Dean’s position in the market has changed too – with a number of sales and acquisitions over the last seven decades undoubtedly dictating the peaks and troughs of its success.

In 1969, under the ownership of British Lion Films – 16 years on from when it was first founded by Ernie and Charles Pearl and Bob Dean – Pearl & Dean was up against three other competitors: Rank (now Digital Cinema Media), Faber and Presbury.

It was during that decade that it controlled 52% of UK advertising contracts; however, a sale to Mills & Allen a few years later saw that figure plummet to an all-time-low of 12%.

Fast forward to the early 90s and things seemed to be looking up again under the ownership of French company Mediavision – until broadcaster STV Group bought them out and offloaded “heavily loss-making” Pearl & Dean and its 36% market share to Image Ltd. in 2010 for just £1.

On the face of it, you might be forgiven for thinking that Pearl & Dean has entered 2017 as a business in trouble.

The days in which it had a majority market share are long gone – and becoming a fully-digital operation in 2008 appears to have made the UK’s only other cinema advertiser, DCM, even more attractive to brands.

Meanwhile, documents filed to Companies House show that profits have been much more modest in recent years – the business posted a £17 million profit in 2009, £8,000 in 2012 and £406,000 in the latest account for 2014 – and losing both Curzon and Everyman cinemas to DCM last year means Pearl & Dean now has less than a fifth of UK cinema ad contracts. This includes Empire, Showcase, AMC and a handful of UK independents.

DCM, on the other hand, now owns 3,000 screens at 485 sites – with Cineworld, Odeon, Vue, Picturehouse, Curzon, Everyman, alongside a host of indies together giving the advertiser an 81% market share.

Unlike the rest of the media industry, with the likes of Thinkbox for TV, Newsworks for newspapers and Magnetic for magazines, cinema operates without a marketing body – meaning DCM and Pearl & Dean have to prove their own value to advertisers.

DCM’s investment in producing robust econometrics studies and hosting regular film screenings for agency planners might have something to do with its growing market share – even if it hasn’t made a profit for the last four years. Or perhaps the decision to add ‘digital’ to its name when it rebranded in 2008 made DCM look more future-focused than a brand whose image has remained largely unchanged over the years.

Yet away from the spotlight, behind all the free films and booze, Pearl & Dean is still innovating and expanding – but in ways that move it beyond the traditional cinema screen.

Experiential forms of advertising are becoming a unique and growing part of its business strategy as it looks to tap into distinct audiences – and now account for 7-8% of total company revenue.

Pearl & Dean already does a lot with ‘pop-up’ cinema, including the Luna and Rooftop Film Club, but its portfolio is now starting to span other sites such as cruises and pantomimes.

In fact, the advertiser now does cinema-type activities at 10 different panto sites which draw in around 650,000 people. Aside from running a standard ad-reel at intervals, this includes using the screen on stage to entertain children pre-show, integrated advertising messages and running competitions.

“We’re constantly looking for new territory…and the right types of fit for us to go into,” Pearl & Dean’s enterprise director, Mike Hope-Milne says.

“We look for distinct opportunities where there’s a distinct target audience – so with pantomimes and P&O cruises it’s a very distinct audience and easy for advertisers to understand who they’re targeting.”

Pearl & Dean said it expects the revenue from experience-based advertising to continue on an upward trajectory.

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Meanwhile, it is producing its own content for clients – including a monthly magazine show from the red carpet – and brokering partnerships between advertisers and films, while also exploring how it can become more of a consumer brand.

While people know Pearl & Dean for its catchy ‘pa-pa’ theme, Hope-Milne said they still get asked if they’ve got any films coming out.

“We’re looking at how we can capitalise on how Pearl & Dean has got a strong brand equity in the consumer market,” he says.

“We’ve got a consumer website that generates a reasonable amount of income for us. We’ll also be launching a consumer app this year [2017] which will be similar to the website but we’re going to be working with brand partners to build some exciting features.

“That will be one of the new innovations for us this year.”

As for losing two major ad contracts to DCM last year, it’s “business as usual” for Pearl & Dean.

“In terms of how we trade and how we trade with the agencies, nothing has really changed,” says sales director Zoe Cadman. “Other sites that we look after have grown organically, so in actual fact when the circuit’s moved it hasn’t actually affected our market share.

“If we were 20% of the market in any other market, say radio, I think the job would be a lot harder because there might be four other players there who have a different share. With us, because it’s only ourselves and DCM, agencies like to have two points of buying cinema; they don’t want to have just one organisation that controls all of the industry.”

Hope-Milne also shrugged off the competition and said Pearl & Dean and DCM are more “like siblings”.

“Pearl & Dean has never been about fighting with competition; it’s about growing the medium,” he said.

“So we work together on a lot of projects, we work on how to build the medium – and like siblings we sometimes kick each other under the table when mum’s not looking. [DCM] are the competition, but we’re not losing sleep at night.”

Jenny Jones, AV account director at MEC UK, said it’s important for there to be competition in the cinema industry, and that by innovating beyond pure spot Pearl & Dean is expanding the opportunities available to advertisers.

“They are providing exciting and unique stand out opportunities and their ability to incorporate brands into the fabric of the cinema experience is what they do best,” Jones said.

“In this digital first world it is understandable that there are concerns of them being left behind, however, advertisers are seeking out those shared moments and collective viewing experiences that are getting increasingly difficult to find.

“I believe this diversification into screen events will differentiate Pearl & Dean and safeguard them for the future by providing a platform for advertisers that incorporates brands seamlessly into a unique environment with an easy to identify audience.”