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Michaela Jefferson 

DCM's Stacey: Cinema plugs TV's gaps

DCM's Stacey: Cinema plugs TV's gaps

The CEO of cinema's largest advertising company tells Michaela Jefferson why she wants to work with TV, what the big screen must do to win in a streaming world - and how she wants to take on Facebook and Google

Karen Stacey wants media planners to see cinema as the plug that can fill the gap left by TV's declining influence among young audiences.

"The two are completely complementary," the CEO of DCM - the advertising company representing 82% of the cinema industry - told Mediatel News.

While the established broadcasters may be struggling to engage with a generation of online streamers, cinema continues to prove popular with young audiences. Converting cinema admissions to TV industry ratings, this year's record breaking blockbuster Avengers: Endgame delivered 36 television viewing ratings (TVRs) for 16-34 year olds.

In comparison, the 2018 England vs Croatia World Cup match, broadcast live on television by ITV, delivered 29.5 16-34 TVRs.

"If you look at the cost per thousands of 16-34s on TV, where audiences have dropped so much, the actual cost per thousands [of 16-34s on cinema] are really similar," Stacey said.

Elsewhere, research from Kantar Millward Brown has found that among 16-19 year olds, cinema is the most popular traditional advertising medium, with 59% feeling 'positive about it' compared to 34% for print, 38% for TV and 50% for outdoor.

"I think what we're trying to say to advertisers is that you might not consider cinema because you thought it was expensive, you thought the numbers were really small and some of the cinemas used to be really grotty," Stacey said.

"That's not the case anymore. And actually, what's happened - because the days of even an X Factor final reaching 25 ratings in one 30 second spot are just no longer - is the audiences that cinema can do are just so much more comparable."

However, that doesn't mean DCM wants to steal advertising revenues from broadcasters.

“If you were TV you’d think we were after your money. No we’re not. We’re after Facebook and Google and online video," Stacey said.

Instead, she confirmed that DCM wants to align itself more closely with TV marketing body Thinkbox and the entire TV industry in the minds of planners - a mission she has pursued since picking up the reins at the cinema ad company five years ago.

In that time she has worked to move cinema planning out of out-of-home within agencies into their AV teams; created an IPA gold standard planner with the RSMB and introduced it to the major agency groups to sit alongside their TV plans; and begun reporting cinema admissions as TVRs so they can be directly compared to TV viewing figures.

“Our offers are very similar. In fact, Lindsay [Clay, CEO of Thinkbox] and I talk a lot and we said that what we offer is a regulated, brand-safe, quality content offering to advertisers. So... we're saying the same thing.”

Media owners must take responsibility for 'bombardment'

However, it's no secret that as a whole, trust in advertising is at an all time low. According to a paper published earlier this year by industry think tank Credos, public favourability towards advertising fell to just 25% in December.

The paper states that while people appreciate its benefits, there are a range of issues negatively impacting their perceptions of ads - including "bombardment" and "intrusiveness" - with online advertising and targeting technologies taking the bulk of the blame.

"No one is saying don't use it. [But] the proof is in the pudding," Stacey said, criticising the industry for its "obsession" with targeting.

"If people are bombarded and therefore going to adblock, that's because you're not informing, entertaining and delighting, you're annoying! So stop.

"The danger we've got is that if we don't, then you're in danger of killing the goose that laid the golden egg."

While advertisers like Brewdog and Doritos jump on the anti-advertising bandwagon in an attempt to connect with young audiences who 'hate advertising', according to Stacey it's not the advertising that young audiences hate, but the way they're being advertised to.

"[Young people] like brands, they like entertainment, but if you bombard them all day [they'll] switch off," she said.

However, rather than laying blame at the advertisers' and their agencies' door, Stacey's "big belief" is that it is media owners who should take responsibility for preventing bombardment.

"At the end of the day, we're the gatekeeper. We will turn down money because our ad reels will be full... Because it's my responsibility as the gatekeeper to the cinema audience to respect and delight them and give my advertisers real value for money," she said.

That applies to digital platforms Facebook and Google too, Stacey added, demanding that they start identifying as media owners and capping the number of ads they allow.

"The day [Facebook and Google] took a pound of advertising, they're a media owner. They have a responsibility towards those advertisers that fund their business and make their business as wealthy as it is to make an environment that is legal, trusted and right for their brands. And they should be regulated like everyone else.

"If you want to be an open platform, crack on - don't take advertising."

Plans for future growth

Although subscription streaming services like Netflix, Amazon Prime and the upcoming Disney+ loom ominously over the broadcast television industry, cinema has more of a love-hate relationship with SVOD.

On one hand, the amount consumers spend on digital home entertainment, including on online subscriptions, surpassed the amount spend at the cinema globally for the first-time in 2018, reaching $42.6bn compared to $41.1bn.

However, James McDonald, managing editor at WARC, remarked in response to the data that the experiential nature of cinema puts it in a different bracket to SVOD services, and coupled with the exclusivity of box office hits, any downward pressure from streaming services should be minimal in the short term.

Likewise, Stacey's only concern for the future of cinema advertising is if the studios choose to take the exclusivity of its content away by streaming their films on their own channels at the same time. "At the moment though they're not going to do that... [because] the way they make their most money is to run it on cinema first."

Meanwhile, this year DCM reported its biggest ever first half year in terms of cinema ad spend with a 12% year-on-year rise, while attendance to the pre-show is up by 15% over the last four years.

Going forward, Stacey wants to continue to reshape the way cinema's story is told within the ad industry, and to invest further in creativity via its own content studio, DCM Studios, which creates cinema ads tailored to the film they are shown against.

"This is our time. Everyone else in traditional media, for want of a better phrase, their core proposition is getting weaker, not stronger," said Stacey.

"Ours is getting stronger, not weaker."

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LindseyClay, CEO, Thinkbox on 27 Sep 2019
“Well this is awkward.
Karen does a great job for cinema and is quoted here saying loads of things I can furiously agree with – like how TV and cinema are complementary, they’re brand safe and can be planned together. There is clear blue water between them and Facebook and much online video. An ocean in fact.
But we get into choppy waters when she compares the aggregated viewership across many weeks of the highest grossing film of all time with a single World Cup match on ITV. Not really a fair comparison. If you aggregate the linear TVRs for the World Cup on TV, you get 469 16-34 TVRs. Love Island would get 755. Bake Off would get 164. Game of Thrones would get 82.
It is odd to claim TV has somehow declined to a point where cinema can step in – and odder still to claim they have comparable CPTs, when cinema, at £60-70 for 16-34s, is roughly double the price of TV.
Thinkbox loves cinema, we’d like one in every home for people to watch TV on, but they are just not comparable media in terms of scale. Let’s put things in context:
Commercial TV reaches 75% of 16-34s a week, according to IPA Touchpoints data. Cinema reaches 10%. TV accounts for just under half of 16-34s’ total video viewing and almost 90% of their video advertising viewing. Cinema, wonderful though it is, accounts for 0.6% of their video viewing, and 0.9% of their video advertising viewing. Broadcaster VOD alone is over 10 times bigger than cinema.
I really can’t stress enough how great cinema is, and cinema advertising. But cinema would have to multiply its volume by an order of magnitude to start being able to claim it is plugging any gaps in TV advertising. The thing that is actually plugging the gap created by 16-34s watching less linear TV is non-linear TV: Broadcaster VOD.”