If trailers of Christopher Nolan’s upcoming film Dunkirk (based on the famous Dunkirk evacuation during World War II) have whetted your appetite for more war movies, you could take your pick from the likes of The Guns of Navarone, Where Eagles Dare or Saving Private Ryan. But, as any film buff will tell you, watching these classics on DVD or TV is no match for a theatre experience, where roaring enemy jets swooping down on the Allies can send you ducking for cover too.
PVR Ltd is set to change that. Come October, and it will bring screens to the beck-and-call of moviegoers, allowing them to schedule a show of their favourite film at a screen of their choice and a time of their convenience. Welcome to Vakaoo, a new platform that the company is beta-testing. While a show can be scheduled only if a minimum threshold of tickets is sold, Vakaoo also helps a user reach out to others through social media and tie up with those who are interested in the movie. “People today want to consume content when they want, at their convenience and at a place of their choice,” says Kamal Gianchandani, chief of strategy, PVR. “With Vakaoo, we are offering them such an option.” For this purpose, the company is offering its library of over 1,000 films (Hollywood, Bollywood, and regional movies).
Vakaoo is just one element in the large-scale transformation that India’s biggest multiplex chain is undergoing. Rapid growth (it tripled its screens in the last four years) is no more its sole objective. It is deploying latest technology, data analytics (to understand customers better) and unique food and beverages (F&B) options to offer customers an unmatched movie experience. In doing so, PVR has flipped a switch not just to beat competition from other multiplex chains like Inox, Cinepolis or Carnival, but also from all other forms of ‘out of home’ entertainment that the rising ranks of aspirational Indians are warming up to. Says CEO Gautam Dutta, “How do I go beyond my content to attract someone for a three-hour break at PVR is the challenge.”
PVR Chairman and Managing Director Ajay Bijli’s father, Kishan Mohan Bijli, who was running a trucking business, acquired Priya Cinema in the 1970s. In 1995, Ajay exited the trucking business and launched PVR, which set up its first multiplex in Delhi in 1997. Its initial growth was sedate. It took the company a decade-and-a-half to reach 213 screens in 2012. Then it exploded. It acquired Cinemax (138 screens) in 2012, and DT Cinemas (29) earlier this fiscal for a combined cost of Rs 1,000 crore. By the first quarter of the current fiscal, PVR had 557 screens across 121 properties in 48 cities. Inox, its nearest competitor, had 430 screens, while Carnival and Cinepolis had 325 and 265, respectively.
PVR’s customer-centric approach comes at a time when the industry is rapidly evolving. “Today, competition for multiplexes comes from multiple fronts. When it comes to entertainment and content, the competition is from TV and on-tap demand (OTD) platforms such as Netflix, Hotstar, iTunes,” says Jehil Thakkar, head, media and entertainment, KPMG. “Then, there are other outdoor entertainment activities like a stroll in the park, a visit to the beach, shopping or eating out.”
Agrees Kiran Reddy, MD, SPI Cinemas, the largest multiplex chain in Chennai (PVR was recently in acquisition talks with SPI Cinemas but the deal fell through). “We are competing for people’s time and money,” he says. “It is important for theatre chains to be relevant to occupy a sufficient part of people’s leisure time.”
PVR has adopted a multi-pronged approach to achieve this. And technology is top priority. Almost a decade ago, it shifted to the digital projection system. Today, it has fitted 4K projectors, which offer better resolution than the earlier 2K versions. When it comes to sound, technology has evolved from 5.1 Surround Sound to 7.1 to 11.1 and now Dolby Atmos (strategically placed speakers make viewers feel that the sound is flowing around them). Most of the PVR properties have Atmos as well as second-generation 3D systems. Its Noida property offers the 4DX technology (where all five senses are stimulated). “Cinema has been around for the last 100 years, but it is only in the last decade or more that we have seen massive development on the technology front, especially after the advent of digital cinema,” says Sanjeev. “We are taking full advantage of this.”
The company is testing futuristic technologies with top-of-the-line Barco laser cinema projectors and screens in Bengaluru, which could well be the precursor to virtual reality in cinema. “We want to ensure that when it comes to watching a film, the theatre experience we offer is unmatched,” adds Sanjeev.
For the urbane crowd, going to the movies is not just about what’s on screen, but a cinema-plus experience. For this, PVR has created five theatre formats—Director’s Cut, Gold Class, Premiere, PVR Cinemas and PVR Talkies. “No two properties are similar when it comes to design. Our investment cost per screen is much higher than our competition’s,” says Sanjeev. PVR’s experiment with its Luxury Collection—PVR Gold Class and Director’s Cut—has seen some success. It has rolled out PVR Gold Class (these 28 screens have reclining seats, gourmet menu with live kitchen, and top-end projection and audio systems) where the average ticket price is Rs 1,800 on a blockbuster weekend. “Customers here are a pampered lot,” says Renaud Palliere, who handles the Luxury Collection and International Development for the company.
PVR Director’s Cut, at Ambience Mall in New Delhi’s Vasant Kunj, is a notch above Gold Class. “People come to Director’s Cut for the experience. It is a seven-star movie experience with fine dining,” says Palliere. Employees here have been hired from five-star hotels and the ticket price on a blockbuster weekend can go up to Rs 2,400. But that hardly seems to matter as the average footfall is similar to other formats. “Director’s Cut spoils you. After experiencing it, I do not go to any other cinema,” says Vir Sanghvi, journalist and food critic. Not just the theatre, but Sanghvi has another reason to love the format—the food. “The sushi bar called Simply Sushi is very good. Sushi is an idea whose time has come,” he says. “And the choice of chef Yutaka Saito is the best thing that could have happened to PVR, which had been struggling with F&B options at Director’s Cut.”
CFO Sood is happy too. PVR’s Luxury Collection is helping the company increase its average ticket price and F&B spend per head. “Elsewhere in the world, luxury cinemas lose money as costs are very high. We have been able to crack the code and generate margins that are similar to other formats,” says Sood.
F&B is a focus area not just at Director’s Cut but across all formats. There are good reasons for this. Says Palliere, “We have no control over the film. Its quality is subjective. Good F&B options will ensure that customers still have a good overall experience even if the movie is not up to their expectation.” The company invests a lot to identify what sells where and tries to push out unique products in different locations. Its F&B spend per patron has risen from Rs 40 in 2011-12 to Rs 72 in 2015-16, and it even acquired gourmet popcorn brand 4700BC last year.
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(This story appears in the 14 October, 2016 issue of Forbes India. To visit our Archives, click here.)
Firstly congratulations to Mr. Bijli for bringing this world class experience to us at India. I wish him best. My 2 cents as a movie watcher and his customer. 1. Under indexed screen per mi capita needs to looked as per economic class etc but there is a big potential of eating into the unorganized competition which is cheap but considering the experience quite expensive. We need to look at city based pricing , location based pricing to make it value for money experience and not a once a month.. 2. As we hit the maturity of cinema chains in metros , being the leader , they should segment, segment their audience and insight in each of them and drive away the low time / un-occupancy issue they face. 3. MAKE it Convenient for people to come to you, remember the consumer experience starts as soon they start finding their favourite movie... 4. Lastly : Does the consumer differ between a PVR vs DT experience : create the difference... don't assume, Act like the leader. All the best, keep growing.on Oct 13, 2016