It is in partial fulfillment of the requirements for Marketing Specialization subject Services Marketing (3rd Semester) Project on Comparative Study

of Services Marketing by Fame Cinemas, India And AMC Theatres, USA

Prepared By:

Mr Mohammed Sharif (32) Mr Anand Menon (44) Mr Prasenjit Chakraborty (23)

I. Project Brief
We have studied the Services Marketing Strategy of Fame Cinemas in India and AMC Theatres in USA, both represents the Film Exhibition Segment of Services Industry. Our Scope of Study is limited to the Comparative Study of the Services Marketing Strategy of the companies under study.

II. Executive Summary 1. Executive Summary

In India, from single screens, to multiplexes and to the recent emerging trend of megaplexes, the Indian film exhibition segment, which forms the largest component of the countrys filmed entertainment industry in India, has undergone a sea change. In 2011-12, domestic theatrical film exhibition revenues were estimated to be INR78 billion, contributing 79 per cent of the total revenues of the Indian filmed entertainment industry.

In USA, An astonishing 1.45 billion tickets were sold in 2011-12. But beyond the headlines, the industry is in contradictions: the number of theaters is declining, but the number of screens is at an all-time high, revenues are up, but attendance is largely flat.

2. Situation Analysis:
Market Summary Market Growth In 2015, it is estimated that theatrical revenues in India will increase to INR101 billion, driven by the growth of multiplexes across the country and the implementation of digital technology in cinemas, which is expected to facilitate wider release of films and reduce piracy.

In USA, the market will remain flat and difficult to predict in strong double dip recession as Entertainment being non-essential gets striked off by families as the first step to reduce monthly budget.

Market Trends In India , they Key Trends are : a) Rise in Multiplexes: In 2011-12, there were 1,075 multiplex screens in the country. These comprised around 8 per cent of the total screens in the country, but accounted for 40 per cent of total ticket collections. By 2015, the number of multiplex screens is estimated to rise to 1,925, growing at a CAGR of 12 per cent between 2011 and 2015. b) Increasing Adoption of Digital Technology: As of March 2010, it is estimated that there were 2,000 digital screens in India, a figure that is projected to rise to 2,5003,000 over the next three to four years. Digital prints cost 80 per cent less than conventional film prints, and enable producers to reach five times the number of screens at the same cost. This has significantly improved realizations, since 60 per cent of box-office collections are now earned within the first week of a movies release. Digital cinema allows companies to exactly control at which locations and how many times movies will be shown. It also expands the reach of releases, from large cities to remote towns and villages across India. c) Expansion into Lifestyle Entertainment : Multiplex owners are diversifying into lifestyle entertainment, leisure and casual dining to house several entertainment formats under a single roof to increase their revenues.

In USA, they Key Trends are:

a) Consolidation of Theatre halls: Due to Flat market in USA, foreign players with deep pockets are buying out the established players like AMC theatres by Chinese Dalian Wanda Group , or Phoenix Theatres by Reliance Entertainment. b) Increasing Adoption of Digital Technology: Use of 3D and Imax technology to attract viewers to watch the Movies for different experience which, conveniently enough, also give theater owners a justification for charging more for tickets

Market Needs In India the Market needs are in form of Infrastructure as there in no dearth of demand : Increasing the Number of Screens Improving the movie viewing experience

In USA the market needs are different experience and there is no dearth of Infrastructure: Attract Viewers from other modes of entertainment by offering more 3 D or IMAX format.

Market Demographics In India, The Indian population will increase 20 percent in 2025, an increase of 220 million people. But the number of 12-24 year olds is expected to increase by 30 percent, hence 66 million more potential viewers. Based on current theaters and screens, this is an increase of roughly 3500 per screen. ( Basis No addition of Single Screen theatres presently at 13438 and CAGR addition of Multiplex Screens at 12% and ending up at the end of 2025 at 5978 screens.)

In USA, The U.S. population will increase 17 percent in 2025, an increase of 54 million people. But the number of 12-24 year olds is expected to increase only 9 percent, just 4 million more potential viewers. Based on current theaters and screens, this is an increase of roughly 100 per screen.

SWOT Analysis of Fame Cinemas, India

Strengths Brand Equity FAME Experienced Management Team Professional board Distribution Arm (Shringar) Robust Processes Opportunities Multiplexes: At nascent stage Favorable India demographic Retail boom: Change in the life-style & spending patterns Growing middle class with higher disposable income Weaknesses Scale Regulatory approvals

Threats Over-building Lack of quality content Piracy

SWOT Analysis of AMC Theatres, USA

Strengths
* Diversified media and entertainment business * Consistent revenue * Strong library content

Weaknesses
* Loss Posted in last 2 years * Ageing Property

Opportunities
* Alternative media outlets (i.e., online) * Newspaper and broadcasting market growth * HDTV growth * Multi-year sports agreements * Free to air Mobile DTV with 'up sell' opportunities

Threats
* Increasing use of Digital Video Recorders (DVRs) * Growth of online video, alternative media * Economic slowdown in the US * Regulatory risks

Product Offering
Fame Cinemas offering to Indian population 27 theatres with 102 screens Hospitality Services in theatres

AMC Theatres offering to American Population 346 theatres with 5034 screens Hospitality Services in Theatre More than 46% of screens have 3D & more than 2% have IMAX

3. Marketing Strategy
Mission of Fame Cinemas, India

The mission is to provide World Class viewing experience to its patrons.

Mission of AMC Theatres, USA

The mission is to provide Amazing experience to its patrons.

Target Market
In India: Fame Cinemas target the Metros and Tier II Cities as of now but in long term will consider Tier III Cities also as India is now a growth market. The reason for targeting Metros and Tier II cities is to target families with disposable income and aspiration to enjoy the services offered by Fame Cinemas. In USA, AMC Theatres is available in almost all states of USA, being a mature/ declining market, AMC Theatre now targets 12-24 years and 55+ yrs which comprises of 40% of the market.

Positioning

Fame Cinema positioning strategy in India is to position itself as a Film Exhibitor for the aspiring Indian population. Although their product is similar to other competitors like Cinemax, Big Cinemas etc, but vastly different from Single screen theatres , their unique proposition is the location of Fame Cinemas, which are always in the most prime property of the location it operates from.

AMC Theatres positioning strategy is similar to other players in US market, but the unique positioning is to develop a loyal clientele through earlier Movie watcher program and now through AMC Stubs program, i.e Loyalty Reward program which no US exhibitors are offering as of now.
Fame Cinemas in Indian Market wrt Single Screen Theatres 18 inch riser and stadia type Dolby Digital Digital Bucket Seat Available Buy 1 Get 1 AMC Theatres in US Market wrt other exhibitors

Point Of Difference

Seating Arrangement Sound Projector Screens Seating type Advance Booking Reward Programs

18 inch riser and stadia type Sony Digital Digital Loveseat Type Available AMC Stubs

Marketing Strategies Marketing Mix

Product
Fame Cinemas Core Product Provides Actual Product Dolby Digital Bucket type Provides Provides Augmented Product Provides Provides Provides Doesnt provide AMC Theatres

Features

Movie Exhibition Sound System Seating type Comfortable Seating Centralized AC Food Court Convenient Ticket Booking Car Parking Loyalty Reward Program

Provides Sony Dynamic Digital Loveseat type Provides Provides Provides Provides Provides Provides

Based on the above study, It can be inferred that Fame Cinemas and AMC Theatres have not much difference in the Product offered to the Consumers.

Pricing:
Fame Cinemas Pricing Strategy Doesn't Follow Follows Follows Doesnt Follow AMC Theatres

Features

Age Based Show timing Based Seating Position Based Group Discount offer

Follows Follows Doesn't Follow Follows

Actual Price in INR ** Fame Cinemas Silver Premier Executive 270 250 200 Matinee Show 320 300 250 Evening Show 320 300 250 Night Show AMC Theatres Senior Adult Child 476 476 420 Matinee Show 532 588 420 Evening Show 532 588 420 Night Show ** : Actual Price of "The Dark Night Rises" on 22nd Jul at FAME Malad, Mumbai and AMC Montebello, Los Angeles. Assuming 1$= Rs 56

Based on the above study, It can be inferred that Fame Cinemas follow Seating Position and Show timing Based Pricing Strategy, whereas AMC Theatres follows Age and Show timing based Pricing Strategy. It also shows the pricing approach for Fame Cinemas is Value Based Pricing, whereas for AMC Theatres , being in mature market has to follow Competition based pricing and hence even there is huge difference between purchasing parity between India and USA , the Average movie ticket prices in AMC Theatres is only 1.8 times of Fame Cinemas ticket price.

Place

Features Available in No. of States No. of theatres Screens

Fame Cinemas 7 in India 27 102

AMC Theatres 32 in USA 346 5034

Based on the above study, It can be inferred that Fame Cinemas has long way to go to capitalize its position in a growth market, whereas AMC Theatre is firmly positioned in a Mature and highly competitive market with market share of 19%.

Promotion:

Features

Fame Cinemas Promotional Strategies

AMC Theatres

Daily Advt, in Local Newspaper Online Marketing Ticket Booking through 3rd Party Service providers Loyalty Card system Buy 1 Get 1 Free Schemes for Selected Clientele of Credit Card, but with riders. Baby Matinee Shows to attract families with small kids

Follows Follows Follows Doesn't Provides

Follows Follows Follows Provides

Provides Doesn't Provides

Doesn't Provides Provides

Based on the above study, It can be inferred that Fame Cinemas operating in a high growth market can benefit well with Word of Mouth Publicity and spends minimal on Promotional schemes to attract Customers, whereas AMC Theatres in a Mature market has to come out with Loyalty Card System to maintain its clientele. For e.g. AMC Stubs is an all-new program that AMC Theatres offering to their guests as a way to reward them for going to AMC theatres. The benefits are:

$10 reward for every $100 spend Free upgrades on concessions anytime Online ticket purchase fees waived Access to online ticket stub collection

People:
Fame Cinemas AMC Theatres

Features

People Strategies Nos Of Employee 1650 Employee Attire Uniform Employee Behavior Courteous Attitude towards patrons Pleasant Training and Development Well Trained

18500 Uniform Courteous Pleasant Well Trained

Fame Cinema Recruitment and Training Process : Fame Cinema recruits both through Online Advt of open positions and through Recruitment consultants. HR function is still managed centrally from their Mumbai Headquarter and HR representative in each location coordinate with Theatre Manager to arrange interview with right Candidates. Post recruitment they arrange On the Job training programs for quick integration of the New employee to Fame Cinema way of work.

AMC Theatre Recruitment and Training Process: AMC Theatre receives approx. 1.75 Million job applications a year. To ensure consistent hiring practices these applications are handled online .Local Theatre Managers select promising candidates based on applications and online assessments (Psychometric tests), then Schedule Interviews. The Individual interviews follow an AMC Script using behavioral assessments and situational Questions, helping them to assess applicants compatibility with AMC performance standards for all Associates. Once an employee is selected he/she undergoes weeklong training, including cross training in all aspects of theatre operations.

Process The process is a sequence of actions to deliver the service to the customer. Fame Cinema : In this case the following is the process followed by FAME. The customer arrives to FAME by car and first goes to the pay n park to park the car. The customer then moves on to the ticket window to purchase the ticket for the movie he is interested to watch. Then the customer enters the building. Here the usher at the door checks for the tickets. Then the customer will move on to the screening area and watch the movie. In the interval the customer will mostly come out to eat or drink something from the cafeteria. The customer goes back to the screening area to continue the movie. Watching a movie at Fame Cinemas is like taking a short vacation. There is a cool ambience, quality service and convenience in booking. AMC Theatres: The AMC Theatre process is similar to FAME Cinema.

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Physical Evidence

Features

Fame Cinemas Ambient factors Yes Yes Stadia type Design factors Deep Purple T shirt Purple Hue Based Yes Yes Social factors Yes Yes Yes Yes Visual Picture

AMC Theatres

Air conditioning Excellent ventilation Seating Arrangement Uniform Color Interior Color Scheme Extensive parking lot Spacious interiors Well dressed employees Courteous Elite and up market crowd Family atmosphere

Yes Yes Loveseat Deep Black Shirt Red Hue based Yes Yes Yes Yes Mixed Yes

Inside Seating

Food Court

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