Pre-film ad sales turning into blockbuster for theaters.

Call it the power of a captive audience. Despite last year's box office slump, movie theaters enjoyed a 20 percent increase in prefilm advertising in 2005.

The Cinema Advertising Council has released figures showing that advertising revenue increased to $528 million in 2005, compared to $438 million in 2004.

The numbers have been boosted by the entry of Nielsen Media Research into the cinema marketplace two years ago. The ability to track data on moviegoers has made some advertisers increase their buys and attracted new buyers.

"Two to three years ago, (movie theaters) were not part of the plans for marketing buys and today we are," said Bob Martin, president and chairman of the council. "People are not running in and out of the room and don't have a remote control, so that works in our favor."

The money is coming from a range of sectors. Big-spenders last year included automotive and consumer electronics firms, restaurants, banks, real estate companies and health & fitness clubs.

The theaters can point to some impressive numbers in making their pitch to advertisers. According to a Nielsen Media Research and Nielsen Cinema Audience Report from 2005, 32 percent of moviegoers are in the coveted 18-34 year-old demographic range, compared with 24 percent of the U.S. population overall. More than 53 percent of the U.S. population goes to six or more movies per year, according to Nielsen.

Consumer resistance?

The theater owners concede that some moviegoers don't appreciate enduring a passel of ads with their movies, but feel that the resistance is diminishing and that some customers actually enjoy them, especially now that the ads are more artful.

"Nobody buys a DVD for the behind-the-scenes or special features elements, but when you get it you end up watching them and enjoying it," said Cliff Marks, president of sales and marketing for National CineMedia LLC, a joint venture of AMC Entertainment Inc., Cinemark USA, Inc. and Regal Entertainment Group. He cited company research that suggests an 80 percent approval rating for onscreen ads. "As long as we get it over in plenty of time and let them have their time back they're happy with it."

The extent of the ad time--typically extended by a handful of trailers for upcoming films--is an issue for many moviegoers. Some states have even legislated that theaters must provide accurate times for actual start of the feature film.

"We have plenty of patrons who are pretty upset about it, and I understand," said Greg Laemmle, president of L.A.-based Laemmle Theaters. Laemmle has a two-minute limit for pre-film advertising on its 47 screens, and tries to ensure that the ads are tailored to the theaters' art-house content.

"We're not averse to making more money, but our opinion is that there is an appropriate level and we have hit that," he said. "To throw more at the patrons is counterproductive. We're still in the movie business."

But the effect on moviegoers may be somewhat softened by the fact that as more categories of advertisers have gotten in on the premovie action, on-screen advertising has become increasingly slick.

ScreenVision, for example, has an actor-hosted entertainment show format with trivia, entertainment content and ads which runs for 20 minutes before a movie's advertised start time. The company also presents themed content based on the month. October, for example, was "scream month," with a horror bent.

"We're not arrogant enough to think that we can just run advertising without packaging it with very strong entertainment elements," Marks said.

One of a growing number of on-screen ad placement companies, ScreenVision advertises on 15,000 screens across the country, including Southern California-based chains like UltraStar Cinemas and Cinema,Star Luxury Theaters Inc. (The company is a joint venture of Thomson Corp. and British television broadcaster ITV.)

"The marketing muscle of Hollywood is so strong that by the time people get into the seats they are more engaged and more receptive to begin with," said Jason Brown, executive vice president of national ad sales for ScreenVision, who added that the greatest growth in the onscreen ads will come in the sectors of automotive imports, major wireless technology and dining.

"Quick-service restaurants are quickly becoming a big category, largely because we are out of the home," he said, citing research that suggests 40 percent of moviegoers dine out when going to a movie. "(And) we are going to see a lot more (advertising) from finance and insurance because it's a great transaction platform. They can promote using a credit card to buy a movie ticket."

BY ANNE RILEY-KATZ

Staff Reporter