Canadian Exhibitor Bundles Movie Admission and Home Video

Canadian movie exhibitor Cineplex launched its SuperTicket service this summer that bundles admission to a theater screening with a digital copy of the same film, delivered electronically months later. The package costs more than twice as much as a ticket to see the movie in a theater. The company experimented with SuperTicket deals for three films: “The Smurfs 2,” “Pacific Rim,” and “Kick-Ass 2.” While the approach could be a remedy for declining DVD sales, it remains unclear whether fans will pay in advance for a digital copy.

Cineplex has not disclosed sales figures regarding SuperTicket, but says it already has deals with four major Hollywood studios, with more deals expected to be announced this year.

For “Pacific Rim,” SuperTicket provided a $19.99 option that offered moviegoers admission to a theater screening and a downloadable copy to be available shortly before the DVD and Blu-ray versions are released. Additionally, a $24.99 SuperTicket option offered a high-definition digital copy.

“By selling a theatrical ticket and home video copy simultaneously, studios can consolidate costly marketing campaigns that usually promote the same movie twice, first in theaters and then again for home video,” reports The Wall Street Journal.

“The upside for theater operators, meanwhile, is that they typically don’t benefit from home video sales or other revenue a movie generates after its theatrical run, but they get a cut when tickets and home video are bundled.”

A decline in DVD sales has Hollywood studios looking for new means of revenue. According to the Digital Entertainment Group, home video sales are down nearly 20 percent from their 2004 peak.

“At the same time, digital distribution began to account for a greater share of the home-entertainment market, with year-over-year streaming revenue increasing 45.1 percent in 2012 and digital download spending up 35 percent,” reports WSJ. “In all, digital distribution accounted for nearly 30 percent of the $18 billion spent on home entertainment in the U.S. last year, up from 19 percent in 2011.”

“You’ve got 40,000 screens in the U.S.,” explained Dan Fellman, president of domestic distribution for Warner Bros. “Why not convert them to retail opportunities for us?”

Paramount experimented with a $50 “mega ticket” for “World War Z,” which allowed moviegoers to see the film two days before its national release and download a digital version when the movie became available on home video. The deal also included popcorn, 3D glasses and a poster. Four of the five theaters that opened for mega ticket screenings were reportedly at capacity.

“Megan Colligan, president of domestic marketing and distribution at Paramount Pictures said such combination programs make better use of marketing dollars,” notes the article. “Traditionally, studios try to sell DVDs ‘with a fraction of the marketing dollars that we had for the theatrical release,’ she said. The programs try to change moviegoer behavior that has been in place for decades, said Ms. Colligan. ‘That question, up until the recent past, wasn’t something anyone would consider.'”