Cinema

Box office revenues were again strong in 2018, with ticket sales breaking all records held since 1978. Cinemas are investing heavily in comfortable seating, in new technologies and in experimenting with new business models.

What’s new?

Box office revenues in the Netherlands grew from €302m to €312m in 2018 (3.4% y-o-y), driven mainly by an increase in the average price per ticket from €8.39 in 2017 to €8.75 in 2018 (4.3% y-o-y). At 35.7m, the number of cinema visits was slightly lower than last year (36.0m), mainly impacted by the FIFA World Cup and a relatively warm summer. On average, 2.1 tickets per capita were sold, in line with 2017 numbers. Growth has been driven primarily by a number of high-performing blockbusters screened in the second half of the year. Bohemian Rhapsody was very popular with 1.3m admissions, followed by Mamma Mia! Here We Go Again (964k admissions) and Fantastic Beasts: The Crimes of Grindelwald (3D) (906k admissions). Although Dutch-titled films still lag behind international releases with just 4.0m admissions (2017: 4.3m admissions), a number of Dutch films – including Bon Bini Holland 2, Bankier van het Verzet and Doris – performed well and were popular with cinema audiences (350 – 400k admissions).

Cinema operators have been investing to increase the number of visitors, by introducing new techniques, renovating existing cinemas and opening new ones. They have invested particularly heavily in improving the comfort of seating by introducing deluxe and VIP seating: luxurious leather adjustable seats with a footrest. In Den Bosch, Vue opened the first cinema fully equipped with deluxe seats, followed by cinemas in Amersfoort and Arnhem. In addition, the introduction of 4DX and 4DM seats, which are equipped with moving elements and can simulate environmental effects such as wind, bubbles and scent in synchronicity with the action on screen, deliver a fully immersive cinematic experience. Fourteen new cinemas opened in the Netherlands in 2018; total seating capacity, however, decreased by 3,000 because of the new seats which take up more space. 

As well as boosting the comfort and quality of seating, cinema chains continue to invest in sound and vision. Kinepolis Utrecht, for example, has applied ScreenX technology, which provides a panoramic 270-degree viewing experience and Pathé Arena, Pathé Schouwburgplein and Pathé Spuimarkt are one of the first cinema groups to offer the new IMAX laser technology, which improves screen resolution and enhances colour contrasts. Another addition to the laser technology is the IMAX 12-channel sound system which has extra speakers fitted in the walls and ceilings creating an even more intense experience. 

Cinema operators have also introduced new (marketing) concepts. Pathé, for example, launched a summer campaign showing branded content on weather channels, news sites and other channels to attract more visitors during the summer period. Pathé also launched a loyalty programme, Pathé All Stars, which enabled cinema goers to save money on food, drinks and tickets by collecting ‘stars’.

We have also noted that the trend towards screening live events in cinemas such as the Eurovision Songfestival, Wie is de Mol, the Oscars award ceremony, and André Rieu’s live concert in Maastricht, continues to develop. Live theatre, including a ballet performance at the Royal Opera House in London and the season première of the GTST series also remain quite popular.

Cinema (€ millions)

Netherlands Historical data Forecast CAGR%
  2014
2015
2016
2017
2018
2019
2020
2021
2022
2023
2019-23
Box office 250 276 288 302 312 322 330 338 344 348 2.2%
   y-o-y growth   10.3% 4.3% 4.9% 3.4% 3.1% 2.5% 2.4% 1.8% 1.2%  
Advertising 6 6 6 7 8 8 9 9 10 10 6.0%
   y-o-y growth   4.6% 7.4% 5.3% 13.7% 6.9% 6.5% 6.1% 5.5% 5.3%  
Total 256 282 294 309 320 330 339 347 354 359 2.3%
  y-o-y growth   10.1% 4.4% 4.9% 3.7% 3.2% 2.6% 2.5% 1.9% 1.3%  

Source: PwC, NVBF. Note: Because we rounded off amounts and percentages throughout this Outlook, tables may not sum to 100%.

Outlook

We expect cinema revenues to continue to increase by 2% to 3% per year, with box office revenue growing from €329m in 2019 to €348m by 2023. We also expect cinemas to continue to invest in technology and in improving their business model. 

Although online video-on-demand services such as Netflix, Videoland, and NPO Start Plus have gained a firm foothold in recent years and actually exceeded cinema box office revenues for the first time in 2018, cinema visits in the Netherlands are expected to grow. Not only are cinemas trying to use their out-of-home brand names (such as Pathé Thuis) to develop new revenue streams, they are also investing more heavily in providing a premium audience experience as an alternative to VOD services. 

Thus far, Dutch cinemas have been successful in growing the top-line while competition in the video domain has increased. This confirms once again that cinemas can compete in the out-of-home leisure industry, although total revenues are highly dependent on block busters.

In coming years, more and more VOD services will appear and compete at a global level. All these services will require high-quality, exclusive, and sometimes local video content. Safeguarding access to new releases will be critical for the long-term success of film theatres.

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Contact us

Guido van Aardenne

Director, PwC Netherlands

Tel: +31 (0)88 792 65 10

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