PADMASHREE DR. D.Y.PATIL UNIVERSITY DEPARTMENT OF BUSINESS MANAGEMENT

BUSINESS POLICY AND STRATEGIC MANAGEMENT

RESEARCH PAPERON

COMPARATIVE STUDY ON MULTIPLEX V/S SINGLE SCREEN

SUBMITTED BY:

Dikshit Parekh 01 FINANCE-1

Anisha Subramaniam 104 FINANCE-1

Shalaka Mohite 44 HUMAN RESOURCE MANAGEMENT

SUBMITTED TO: MS. APRAJITA PRIYDARSHINI

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INDEX

Serial No Particulars Page no1 EXECUTIVE SUMMARY 32 KEY PLAYERS IN MULTIPLEX 43 OBJECTIVE 74 RESEARCH METHODOLOGY 75 DATA ANAYLSIS 9

6 REASONS FOR MULTIPLEXES PREFERRED OVER SINGLE SCREENS FOR MOVIE VIEWERS

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7 LIMITATIONS & CONCLUSION 198 ANNEXURE 209 REFERENCE & SOURCES 22

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EXECUTIVE SUMMARY

This study is all about to understand the consumers’ perception towards the multiplexes

and to forecast the future of multiplexes. The study reveals that the future of the

multiplexes is very bright and since there is sudden increase in the per capita income

which led to the increase in standard of living of the natives. Now the metropolitan

culture has started intruding in the city and people are in the condition to spend more.

The spurt in the nationwide standard of living of the people has led to some very drastic

changes in the current scenario.

This study is carried out with the help of questionnaire which discloses the extravagant

responses of the respondents towards the multiplexes. As per the data collected we

found that all respondents welcome the culture of multiplexes in the city. The people

are very happy to have the pleasant experience of watching the movies in multiplexes

which they so far used to get only in metropolitans but now in their homeland. The fact

is quite apparent with the kind of data we have gathered through this study which is

mentioned later.

In our research project our point of focus is on determining the movie viewing habits for

the age group of 20-30 years of age. It includes the medium preferred by the people for

watching movies, how frequently they watch movies and what their monthly

expenditure on it is. Some key issues like strikes in multiplex, their effect on the revenue

generation for multiplex and the competition between multiplex and Cineplex.

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MULTIPLEX

India currently has 11500 existing screens, 95% are standalone, single screens. These

single screen cinemas are poorly maintained as the owners find it difficult to upgrade

and renovate their facilities, due to unavailability of organized finance. The deteriorating

quality of these cinemas dissuaded viewers and they started using alternative viewing

options.

Over the last few years, multiplexes have emerged as a trend in urban India.

"Multiplexes" are essentially cinemas with 3 or more screens. They provide a quality

viewing experience and are generally located around shopping malls to increase

footfalls in these malls. Each screen in a multiplex has small seating capacities in the

range of 150-300 seats as compared to single screen cinemas which have capacities in

the range of 800-1,200 seats. With around 11500 active screens, India is under

screened. China, which produces far lesser films than India has 65,000 screens while the

US has 36,000. India’s screen density stands low at 12 screens per million populations.

There is a need of at least 20,000 screens as against the current 11500. This gives

multiplex operators enough room to grow as the traditional single-screen theatres do

not have the financial wherewithal nor do they enjoy tax incentives.

KEY PLAYERS IN MULTIPLEX

1. PVR CINEMAS:

Strong operational performance

Aggressive expansion plans

Foray into co-production

Leading Multiplex operator

Entertainment tax burden to decline

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2. INOX LEISURE

Consistent performer

Impressive capacity ramp-up over the last 4 yrs

Top 25 cites - compelling growth stories

E-Tax exemptions

3. ADLABS FILMS

Integrated Play on the Media & Entertainment Sector

Exhibition Segment - The largest player

Expansion through acquisitions

Future Plans

Film Processing - Leader controlling 70% of market

Film Production & Distribution

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4. CINEMAX

Cinemax India (Cinemax) is one of the smallest multiplex exhibitors within the listed

space with 56screens across 19 properties, a majority of them concentrated in the

Mumbai territory. The company has a predominant presence in the Western region and

is the largest exhibitor in the Mumbai territory with a 35% share of the multiplex

screens in Mumbai. Cinemax is now focused on expanding its presence across the rest of

India and is seeking to aggressively add capacity across other regions

Aggressive capacity addition plans

Tapping ancillary revenue streams

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OBJECTIVE

For any research work there has to be some objective which can highlight the purpose of doing the research work. The main objectives are:

To determine the effect of emergence of multiplex on single screens and societal influence (Strike Issue) on their growth.

To find out whether Multiplexes are considered better option for watching a movie as compared to Single screen and the reasons behind their preference.

This research was conducted in two phases. In the first phase the study was based on the results of a wide survey, that is, personal interview with the aid of printed questionnaires. The second phase of study was conducted by Secondary Research using Google and other Databases. The internet basically serves the purpose for the same

RESEARCH METHODOLOGY

Research Methodology

Desk Research: In this stage we focused on secondary data analysis and looked for the film exhibition industry as in whole.

Questionnaire Survey: We prepared a questionnaire and got it filled by online survey and our respondents constitute age group of 20-30 years.

The Sampling Technique

Stratified Random Sampling: we have divided the entire population into subpopulations or strata and used simple random on each strata.

The Contact MethodQuestionnaire from different respondents

NO. OF RESPONDENTS

Sample size: 50

Location: Navi mumbai

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DATA COLLECTION

Secondary data

Different published and unpublished (only online) materials basically articles from the internet have been focused on.

We have studied and gathered information from a number of authentic sources like: Books Newspapers Magazines Internet

Primary Data

For our research we have used only the questionnaire survey method to conduct our analysis.

Questionnaires are of three categories such as structured, un-structured, disguised and undisguised.But we have used structured questionnaire for our survey. Structured question is the one which has specified number of responses. Such questions restricted the interviewee from giving his own answers and required them to choose from among the alternatives given. This saves a considerable amount of time as the respondents is quick enough to choose from among the options given to him.

Age Group

We have focused mainly on the age group of 20 to 30Yrs. of age group which includes mainly youth i.e. college going students and earning group as well.

DATA ANALYSIS

The following graphs and table are basically a representation of the respondents in the form of questionnaire being filled by them.

The number and percentage wise distribution is shown below and also separate analysis of the graphs has been shown therewith.

Finally a detailed conclusion of all the graphs has been told focusing on key points as well.

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GRAPHICAL REPRESENTATION OF DATA

1) What is your monthly expenditure in watching movies?

2) How frequently you watch movies?

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3) Which medium do you prefer to watch a movie?

4) Do you think Multiplexes are better options than Single Screen (Cineplex) for watching a movie?

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5) What makes Multiplex a better source of entertainment than Single Screen (Cineplex)?

6) Did you find ticket price of Multiplexes as per the service and quality provided?

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7) What are the areas of improvement you find for Single Screen (Cineplex)?

8) Do you think Piracy has eaten into Multiplex and Single Screen (Cineplex) Business?

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9) Do you think the strike by Multiplexes over profit sharing issue was justified?

10) Will the recurring strikes will influence you or direct you to watch movies in Single Screen (Cineplex)?

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ANALYSIS

Single Screens are going to die soon

As per the data collected we can conclude that the ‘Single Screens’ are passé, it no more

attracts the consumers these days. After the primary research we have arrived at the

conclusion that almost 38.2% of respondents prefer multiplex over single screens,

television and DVD. As per 72% respondents multiplex is the better option than the

single screen for watching movies. Respondents prefer multiplexes due to factors like

ambience, crowd and presence of shopping malls. Hence as per the survey the above

hypothesis is justified.

Multiplexes incur heavy losses due to strike

After the primary research we have come to the conclusion that almost 54% of

respondents feel that the strike over profit sharing issue is justified and the rest 46%

think otherwise. Movie viewers irrespective of strike would prefer to go to multiplex

rather than cineplexes. The above hypothesis has been accepted after the analyzing the

results and the factors involved in it.

Multiplex/Cineplex business is affected by piracy

As per the 70% of respondents, they agree to the fact that piracy has eaten into

Multiplex & Single Screen business. This shows the extreme impact upon the movie

viewing business. Piracy has seeped into every sphere of the Film Industry, which has

led to deep losses borne by the filmmakers, distributors and other intermediaries. The

primary data helps us to prove our hypothesis that multiplex business is affected by

piracy.

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Why are Multiplexes preferred over single screens for movie viewers?

On the basis of our analysis, 72% of the people think that Multiplexes are better options

than Single Screen (Cineplex) whereas; only 28% negate the fact. The reason behind this

can simply be answered by pointing out the difference between single screen and

multiplexes.

Multiplexes Single ScreensThe multiplexes enjoys rebates and exemptions from the government.(Entertainment Tax)

Single Screen doesn’t enjoy such exemptions on part of government

They just don’t offer movie but also offer so called add-on facilities

Cineplex on the other hand offer only movies and no extra facilities.

They offer customer with choice in different movies

Single screens don’t offer such facilities with no options to the customers

Talking of the ambience, multiplex offer better sitting , Dolby digital sounds and good graphics for viewers

Single screens on the other hand don’t offer such facilities to viewers.

Multiplexes, by offering food courts, ATM Facility, shopping facilities can offer Add value to money to customers.

Single Screen on the other hand doesn’t offer add value to money to the customer’s income.

The mushrooming of multiplexes has thrown up huge competition amongst multiplexes

and is giving the stand-alone theatres a run for their money. However, multiplex owners

are still upbeat about their business. “In India, we had 3,100 million admissions last year

and only 12 screens per million. So there is a huge potential for growth. The road ahead

for theatre owners is both exciting and challenging. “The service industry is ever

changing and you have to change proactively.

Demand Side - Strong pull

Demand side environment has never been better for the whole media & entertainment

industry in general and multiplex sector in particular. A lot of demographic changes

coupled with sector fundamentals are expected to fuel demand side of the story for the

sector.

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Prosperity to drive discretionary spend

India is a highly favorable country for consumer industries with the entire key indicators

pointing towards higher consumer spends in the coming years.

It has seen its per capita income doubling in the last 6 years, it has more than 60% of its

people under the age of 60, urbanization and exposure to western lifestyle is rising, all

leading towards increasing consumerism in the coming decade.

In the buoyant times; people tend to spend more on the leisure based consumption. For

the multiplex sector, the target group is in the age group of 15-60 years of age, which

visits the theaters more often than others.

People willing to pay for quality

With the entry of multiplexes, which provide better quality movie watching experience

at a higher price compared to single screen theaters, more and more middle income

group people are coming back to the theatres thus unlocking a latent demand. This is a

classic case of leisure consumption winning over value proposition in India. As content

supply booms, more and more people will turn to multiplexes because of the rising

willingness of people to pay for such services.

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Production of Hindi movies

The Indian film industry, with over 3 billion admissions per annum, is the largest in the world, in terms of number of films produced per year. This industry, which was worth US$ 2.12 billion in 2006, is estimated to grow at a CAGR of 16 per cent to US$ 4.42 billion by 2011. The opening 19 of the film industry to foreign investment coupled with the granting of industry status to this segment has had a favorable impact, leading to many global production units entering the country. For example, Walt Disney has partnered with Yash Raj Films to make animated movies, the Warner Group is funding the Sippy’s' film projects.

Analysis on the basis of information collected from vendors

We discussed with staffs and managing body of some multiplex and cinema theaters. As

a discussion with them we perceived the following ideas. Traditionally, price-conscious

Mumbaites now don’t seem to mind paying as much as it takes to enhance their movie

experience. They are quite affluent to spend money in multiplexes. Crowd is better in

multiplexes. Within a few time gaps some positive moves are expected to come and will

make it a better place to hang out. Multiplexes generally cater to high and middle

income groups, with an increase in the number of households within this earning group,

will result to higher consumption and spending patterns. Similarly migration of

households from lower income to middle income levels will further drive the

consumption patterns.

Urban consumers have increased their expenditure on leisure and entertainment.

Simultaneously spends on eating out, movies and theatre, and books and music has

increased. A younger population tends to have higher aspirations and will spend more

as it enters the earning phase. On the other hand people still moving to cinema halls as

the price of ticket is lower. The segment that is attracted towards theater is different.

They say that their business is also running fine. People are rushing for the local movies

like anything. They also find their house full. They are trying to get good movies to

attract more customers. If the movies are good, they used to generate better revenues.

At the time of strike as there was no release of new movies there was a fall in sales of

tickets. It affected both the multiplexes and cinema theaters. Generally in Sundays

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multiplexes remain houseful if there is a release of new movie. In working days there is

a sell of 20-30 percent of the tickets. Multiplexes give offers like gift vouchers, group

tickets, and discount coupons etc. At the time of strike the issue was different. Very few

new movies were released at that time. So the business in multiplexes was affected a

lot. The ticket sold was dropped down to lower than 50%. But cinema theaters managed

to some extent because of regional movies.

LIMITATIONS

1. This study is purely based on the responses received from the respondents.

2. Since we are not the authorized researchers so this study is made keeping in view utmost cost effectiveness.

This study is done in a limited time span

CONCLUSION

On the basis of Primary data analysis:

We have 50 respondents as in total and on the basis of the questionnaires being filled by them we can say that –

Around 50% of the respondents watch movies on a weekly basisAmongst the media which they mostly prefer to watch movies, Multiplex and DVD’s have a major say. Multiplex constitutes around 38% of total respondents and DVD’s with 27.5%.For a view of personal liking to watch movies either in Multiplexes or in Cineplex’s, around 72% responses came in favor of multiplexes.In a question regarding justification of prices charged by multiplexes in accordance to the services provided, 76% agrees to it.Around 70% feel that piracy is going to affect the business of multiplex and Cineplex’s.For improvements on part of single screens, around 33% feel that structure and quality of service is really important along with security and quality.Due to the ongoing strikes between the producers, distributors and multiplex owners we have come to a question that whether strikes are going to influence viewers to watch movies in Cineplex’s and we got a shocking response 60% feel that strikes will not influence viewers.

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Thus, on the basis of these following answers we can conclude that piracy has a major say for the businesses of multiples and cineplexes. Something has to be done to get rid of it very soon. Moser bare has come up with original CD’s at low prices to demotivate sellers of pirated movies. Some other innovative moves in this regard can also solve the purpose. People still like watching movies in multiplexes in spite of the high ticket prices so it can be said that quality is still the top priority and they want their value for money which can be seen by our analysis.

ANNEXURE

Questionnaire

This questionnaire is meant for determining the Effect of Emergence of Multiplex on Single Screens (Cineplex) and societal influence on their growth. Kindly answer the following question to the best of your knowledge.

Name.

Age:

Mobile/Email:

Q1. Which medium do you prefer to watch a movie?

Multiplex Single Screen (Cineplex)

DVD’ Others

Q2. How frequently you watch movies?

Once a week once in a month

Fortnightly Quarterly

Q3. What is your monthly expenditure in watching movies?

0-500 1000-2000

500-1000 Above 2000

Q4. Do you think Multiplexes are better options than Single Screen (Cineplex) for

watching a movie? If yes, than go to Ques.5

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Yes No

Q5. What makes multiplex a better source of entertainment than Single Screen

(Cineplex)?

Ambience Shopping Malls

Food Court Crowd

Others, Please specify__________________________________

Q6. Did you find ticket price of Multiplexes as per the service and quality provided?

Yes NO

Q7. What are the areas of improvement you find for Single Screen (Cineplex)?

Structure Service

Security Quality

Q8. Do you think the strike by Multiplexes over profit sharing issue was justified?

Yes NO

Q9. Do you think such strikes effects your interest in watching movies in Multiplex?

Definitely Probably

Definitely Not Unsure

Q10.The controversies generated out of movies affect the revenues earned by

Multiplexes?

Positively Negatively

Does not effect

Q11. The recurring strikes will influence you or direct you to watch movies in Single

Screen (Cineplex)?

Yes NO

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Q12. Do you think Piracy has eaten into Multiplex and Single Screen (Cineplex) Business?

Yes NO

REFERENCES AND SOURCES

Important Links

www.magportal.com/c/ent/ moviewww.dreamznetsolutions.com/ articles /media-option-websitedesigning.htmlwww.legalserviceindia.com/ articles /fban.htmwww.ankurb.info/2007/03/16/300- movie -re view /www.exchange4media.comwww.techtribe.com

BOOKS REFERRED

Business Research Methods, ICMR

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