{"id":37600,"date":"2025-04-03T06:00:00","date_gmt":"2025-04-03T10:00:00","guid":{"rendered":"https:\/\/www.boxofficepro.com\/?p=37600"},"modified":"2025-04-06T13:57:31","modified_gmt":"2025-04-06T17:57:31","slug":"the-programmatic-future-will-cinema-advertising-share-the-fate-of-linear-tv-advertising","status":"publish","type":"post","link":"https:\/\/www.boxofficepro.com\/the-programmatic-future-will-cinema-advertising-share-the-fate-of-linear-tv-advertising\/","title":{"rendered":"The Programmatic Future: Will Cinema Advertising Share the Fate of Linear TV Advertising?"},"content":{"rendered":"\n

By Jan Runge<\/strong><\/p>\n\n\n\n

Pre-show advertising in cinemas is a key revenue driver that contributes to operators’ bottom lines. As the cinema industry evolves and diversifies its offerings to meet changing audience expectations, cinema advertising must adapt to stay relevant and competitive. Embracing digital solutions, automation, and streamlined workflows is essential to attracting a broader range of advertisers and capitalizing on cinema advertising\u2019s high-value nature. Without this transformation, cinema advertising risks falling behind, facing challenges similar to other media, like linear TV.<\/p>\n\n\n\n

Let’s Look at the Numbers<\/strong><\/h3>\n\n\n\n

In 2025, linear TV ad revenues are forecast to decline by 3.4%, according to global media agency GroupM. By contrast, streaming ad revenues are expected to grow by 19.3 percent, driven by the increasing adoption of connected TV and ad-supported video-on-demand platforms.<\/p>\n\n\n\n

Global cinema advertising revenues are projected to remain at around $2.5 billion, falling short of the $3 billion generated in 2019, as the sector continues to recover from pandemic-related disruptions and faces shifts in viewing habits.<\/p>\n\n\n\n

Meanwhile, digital ad spending on the five major platforms\u2014Google, Meta, TikTok (ByteDance), Amazon, and Alibaba\u2014is expected to account for over 50 percent of global ad spend. This segment is forecast to grow by approximately 10 percent in 2025 alone, underscoring digital media\u2019s dominance in the advertising landscape.<\/p>\n\n\n\n

The State of Cinema Advertising<\/strong><\/h3>\n\n\n\n

Like linear TV advertising, cinema advertising has traditionally been one of the strongholds of \u201coffline\u201d advertising\u2014advertising that is not yet connected to the digital advertising ecosystem. The pre-show is predominantly sold through national cinema advertising sales houses. These companies know the cinema sector in and out and are experts in matching brands with specific film releases. Cinema advertising is a people business, and advertising inventory\u2014the available advertising time that cinema operators can sell to advertisers\u2014is sold directly through sales houses’ internal sales teams to media agencies or brands.<\/p>\n\n\n\n

Only select cinema advertising sales houses worldwide offer onscreen digital ad formats that leverage real-time audience data to enable better targeting. Moreover, most sales houses working with cinemas are not connected to the digital advertising platforms that power more than 70 percent of the global advertising market today. These platforms\u2014Trade Desk, Amazon DSP, Google DV360, and many others\u2014are essential components of programmatic advertising, enabling advertisers to more efficiently purchase and manage digital ad inventory across various channels and in a more automated way. <\/p>\n\n\n\n

As programmatic advertising continues to dominate premium video platforms, several cinema advertising sales houses in the domestic market have embraced its potential, namely Screenvision Media and Spotlight Cinema Networks. In December 2024, the pair unveiled the Cinema Programmatic Alliance (CPA), enabling programmatic advertisers to work with CPA member companies\u2014including Pecan Pie Productions and On the Wall, with other organizations open to joining\u2014through a single entity. The CPA\u2019s creation gives advertisers access to nearly 5,000 screens, giving media buyers unprecedented reach on the big screen.<\/p>\n\n\n\n

Addressing Advertising Inefficiencies<\/strong><\/h2>\n\n\n\n

Due to the above-mentioned market developments, advertisers buy less advertising inventory directly from cinema advertising sales houses. Picture a media agency, such as GroupM, which handles around $60 billion in advertising budgets for the biggest brands in the world. Only 1 in 10 media planning executives for such agencies will consider cinema a relevant marketing channel. The other 9 are focused on digital advertising opportunities. In other words, 9 out of 10 media buying executives cannot access the expertise, insights, and incredible advertising opportunities that national cinema sales houses offer on behalf of their cinema partners.<\/p>\n\n\n\n

Moreover, while cinema can command premium advertising prices when blessed with major blockbusters and during weekends and other peak times, there are also periods when the pre-show is not sold out. This should be considered an opportunity, as cinema advertising has an advantage: The marginal cost of selling an additional ad is almost zero. Once the infrastructure is in place\u2014the auditorium, screen, projector\u2014 selling extra ad slots doesn\u2019t require additional spending. This means that nearly every extra ad sold translates directly into profit for both the sales house and the cinema. To maximize total revenue, cinema advertising should therefore prioritize filling as many ad slots as possible across all campaigns rather than maximizing profits from individual campaigns. <\/p>\n\n\n\n

One Size Doesn\u2019t Fit All<\/strong><\/h2>\n\n\n\n

Cinema inventory should always sell out to maximize total advertising revenue. To achieve full capacity year-round at the optimal price, sales houses must offer a variety of formats at different price points across multiple sales channels. <\/p>\n\n\n\n

The chart below illustrates the difference between the new digital cinema advertising approach compared to what is currently in place:<\/p>\n\n\n\n


Traditional Cinema Advertising<\/strong><\/td>
Programmatic Digital Cinema Advertising<\/strong><\/td><\/tr>

Guaranteed placements <\/strong>\u2013 Advertisers are promised their ad will be shown at a certain time, before certain movies, or in specific cinemas.<\/td>
Preferred deals <\/strong>\u2013 A middle ground between fixed pricing and auctions, where advertisers agree on a price but still get priority access to ad space.<\/div><\/td><\/tr>

Fixed pricing<\/strong> \u2013 Advertisers pay a set price regardless of the demand or timing.<\/td>		Auction-based pricing<\/strong>: Ad slots are sold like an auction, with advertisers bidding for space. The highest bidder wins.<\/td><\/tr>

View-only formats<\/strong> \u2013 traditional pre-show commercials, trailers, and static on-screen advertisements.<\/td>		Interactive formats<\/strong> \u2013 Ads that allow viewers to interact in some way, like scanning a QR code or participating in a game.<\/td><\/tr>

Upper-funnel brand awareness<\/strong> \u2013 The goal is to make people aware of a brand rather than get them to buy something immediately.<\/td>		Lower-funnel performance<\/strong> \u2013 Ads designed to get people to take action, like buying tickets, visiting a website, or signing up for a promotion.<\/td><\/tr><\/tbody><\/table><\/figure>\n\n\n\n

A one-size-fits-all approach doesn\u2019t work in cinema advertising because different advertisers, agencies, and sales channels have their own goals, ways of working, and levels of risk they\u2019re willing to take. Some advertisers may prefer fixed pricing for guaranteed placements, while others might want auction-based pricing for flexibility. Agencies may focus on brand awareness (upper funnel) or immediate sales (lower funnel), and some sales channels may rely on traditional methods, while others embrace digital programmatic advertising. To maximize success, cinema advertising should offer a variety of options to meet these different needs.<\/p>\n\n\n\n

Is Your Cinema Advertising Sales House Future-Proof?<\/strong><\/h2>\n\n\n\n

In Scandinavia, digital cinema advertising is growing fast. For Scandinavian powerhouse Nordisk Film Cinemas, digital advertising has reached 15 percent of total advertising income. At Dansk Reklame Film, the Danish sales house for Nordisk Film Cinemas, the expectation for 2025 is to accelerate digital ad sales growth via programmatic advertising.<\/p>\n\n\n\n

In the Nordic countries, programmatic advertising is available through the Cinemataztic trading desk alongside traditional cinema advertising formats. While traditional cinema advertising is based on fixed pricing and remains a guaranteed product, the programmatic format is offered as preferred deals with pricing based on a first-price auction, where campaigns with the highest bid gain priority.<\/p>\n\n\n\n

The trading desk provides advertisers and agencies with direct access to digital cinema inventory, enabling targeted campaigns based on geography, movie genres, days, time slots, and demographics, such as age and gender. Targeting is driven by real-time audience data, an absolute first in cinema advertising. For each show, audience profiles are matched against campaign objectives to ensure ads are displayed when the desired segment is overrepresented.<\/p>\n\n\n\n

The cinema advertising industry can revitalize and grow by adopting flexible pricing strategies, embracing a comprehensive approach to inventory management, and transitioning to digital advertising solutions.<\/p>\n","protected":false},"excerpt":{"rendered":"

By Jan Runge Pre-show advertising in cinemas is a key revenue driver that contributes to operators’ bottom lines. As the cinema industry evolves and diversifies its offerings to meet changing audience expectations, cinema advertising must adapt to stay relevant and competitive. Embracing digital solutions, automation, and streamlined workflows is essential to attracting a broader range […]<\/p>\n","protected":false},"author":34,"featured_media":29623,"comment_status":"open","ping_status":"open","sticky":false,"template":"","format":"standard","meta":{"_monsterinsights_skip_tracking":false,"_monsterinsights_sitenote_active":false,"_monsterinsights_sitenote_note":"","_monsterinsights_sitenote_category":0,"apple_news_api_created_at":"","apple_news_api_id":"","apple_news_api_modified_at":"","apple_news_api_revision":"","apple_news_api_share_url":"","apple_news_coverimage":0,"apple_news_coverimage_caption":"","apple_news_is_hidden":"","apple_news_is_paid":"","apple_news_is_preview":"","apple_news_is_sponsored":"","apple_news_maturity_rating":"","apple_news_metadata":"\"\"","apple_news_pullquote":"","apple_news_pullquote_position":"","apple_news_slug":"","apple_news_sections":[],"apple_news_suppress_video_url":false,"apple_news_use_image_component":false,"footnotes":""},"categories":[16,22],"tags":[48,5645,5719],"class_list":["post-37600","post","type-post","status-publish","format-standard","has-post-thumbnail","hentry","category-exhibition-features","category-from-the-magazine","tag-cinema-advertising","tag-cinemacon-2025","tag-jan-runge"],"apple_news_notices":[],"_links":{"self":[{"href":"https:\/\/www.boxofficepro.com\/wp-json\/wp\/v2\/posts\/37600","targetHints":{"allow":["GET"]}}],"collection":[{"href":"https:\/\/www.boxofficepro.com\/wp-json\/wp\/v2\/posts"}],"about":[{"href":"https:\/\/www.boxofficepro.com\/wp-json\/wp\/v2\/types\/post"}],"author":[{"embeddable":true,"href":"https:\/\/www.boxofficepro.com\/wp-json\/wp\/v2\/users\/34"}],"replies":[{"embeddable":true,"href":"https:\/\/www.boxofficepro.com\/wp-json\/wp\/v2\/comments?post=37600"}],"version-history":[{"count":0,"href":"https:\/\/www.boxofficepro.com\/wp-json\/wp\/v2\/posts\/37600\/revisions"}],"wp:featuredmedia":[{"embeddable":true,"href":"https:\/\/www.boxofficepro.com\/wp-json\/wp\/v2\/media\/29623"}],"wp:attachment":[{"href":"https:\/\/www.boxofficepro.com\/wp-json\/wp\/v2\/media?parent=37600"}],"wp:term":[{"taxonomy":"category","embeddable":true,"href":"https:\/\/www.boxofficepro.com\/wp-json\/wp\/v2\/categories?post=37600"},{"taxonomy":"post_tag","embeddable":true,"href":"https:\/\/www.boxofficepro.com\/wp-json\/wp\/v2\/tags?post=37600"}],"curies":[{"name":"wp","href":"https:\/\/api.w.org\/{rel}","templated":true}]}}