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Second Run Movie Theaters. Assessing its Value to Customers. NCCU – IMBA Marketing Final Project Presented by: Rakesh Prasad - Alex Yong - Himansu Das - Shubha HS - Marian Jarquin. Agenda. 1. Introduction. 2. Research Questions & Objectives. 3. Field Observation. 4. Hypotheses.

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Second run movie theaters

Second Run Movie Theaters

Assessing its Value to Customers

NCCU – IMBA

Marketing Final Project

Presented by:

Rakesh Prasad - Alex Yong - Himansu Das - Shubha HS - Marian Jarquin


Agenda
Agenda

1. Introduction

2. Research Questions & Objectives

3. Field Observation

4. Hypotheses

5. Methodology

6. Findings

7. Conclusion



Movie theaters
Movie Theaters

2nd

RunMovie

Theater

Art

House

Theater

1st Run

Theater

Adult

Theater

  • New Release Movies

  • Located at High End Areas

  • Prices according to location

  • Art Films

  • New Concept: Art films showed at pubs

  • Prices depend on location

  • Pornography Films

  • Presents those new releases after

  • 1-2 months

  • Located at middle or low areas

  • Lower Prices


1 st run vs 2 nd run movie theaters
1st Run vs. 2nd Run Movie Theaters



Research question objectives
Research Question & Objectives

  • How do 2nd Run Movie Theaters capture value for customers?

    • Explore the Business Model

  • Is there a potential demand to open a 2nd run movie theater near NCCU?

    • Market Research


Field Observation

Exploring 2nd Run Movie Theaters’ Business Model


Pricing promotion
Pricing & Promotion

Pricing

Promotion


Advertising
Advertising

  • Limited or No Advertising:

    • Except for Hsi-men Theater which promotes school concerts.

  • TaiwanFun.com:

    • Brief information about the theaters

  • MRT Station:

    • Information Board


Location
Location

Frequently visited areas:

  • Next to main road

  • Near to MRT stations

  • Close to night markets

  • Close to schools/universities

  • Close to other recreational businesses


Customer segmentation
Customer Segmentation

Customer Segmentation

Monday Movie Goers

Parents

&

Children

Senior

Citizen

Students


Market Research

New 2nd run movie theater near NCCU?


Hypotheses
Hypotheses

Seven hypotheses formulated for the purpose of the research were related to three important factors:

3 Important Factors

Distance/

Location

2nd Run Movie Theaters

Demand

Price

Text



Methodology
Methodology

Conducted a survey to collect Primary Data:

Design Question

Sample

Limitations

A total of 15 questions were asked:

10 Q’s– Movie Attributes

5Q’s - Demographic

Total sample

of 82 NCCU students and Muzha residents

Excluded 9 surveys due to incomplete info.


Methodology1
Methodology

Hypotheses analysis:

  • Z distribution and T distribution were used as the statistical tool to test the hypotheses.

  • Results:

    • Price and location are significant factors affecting the demand for 2nd Run Movies.

    • Potential demand from NCCU students and Muzha Residents.


Findings

New Business Model


Price
Price

Important points to be considered while deciding on the price:

  • Industry average NT$ 60-90

  • 95% Confidence Interval estimate for average price is between NT$ 87 – 100

  • Nearest competitor price (Guang Ming Theater in Muzha) is NT$ 60


Location1
Location

Important point to be considered while deciding on the location:

  • Distance is a significant factor: our survey indicates that most people are not willing to travel for more than 20 minutes to get to the new cinema.

  • Accessibility plays an important role in generating demand, therefore the ideal location for a 2nd Run Movie Theater would be nearby:

    • MRT station

    • Night market

    • Fun, entertainment and leisure related activities/businesses


Other important findings
Other Important Findings

  • Target Market:

    Survey result indicates that difference in “income levels” and “age” does not affect individual’s preference for 2nd run movies


Other important findings1
Other Important Findings

  • Creating Value

    • Explored the opportunity for offering additional fun and recreational activities under the same roof

    • 78% of the respondents supported the idea

    • Research shows that 2nd run movie viewers are price sensitive and would not be willing to pay higher price to have access to such activities under the same roof


Other important findings2
Other Important Findings

  • Other considerations

    • Movie selection/genre: students preference are Drama, Comedy and Action.

    • Advertising: low budget banners, brochures, promote and sponsor school concerts (PR), and customer loyalty program (membership).



What is the potential demand1
What is the Potential Demand?

* ρ = 21% (Sample proportion choosing 2nd RM)


What s the potential demand
What’s the Potential Demand?

  • 95 % C.I. estimate for π is between 11% and 30%

  • 95% C.I. estimate for potential demand:

    16,098 – 42,454 customers

* 20% (Probability to visit the new 2nd RMT at least once every 2 weeks)


Estimated monthly revenue
Estimated Monthly Revenue

BENCHMARK “QIAO XING THEATER”

Monthly Revenue = NT$ 901,000


Next step
NEXT STEP

  • Accomplished our research objectives:

    • New Business Model

    • Is there Potential Demand ?

  • Based on the market research, if any investor is interested in opening a New 2nd Run Movie Theater, estimate of costs (Fixed and Variable) are required.



Conclusion
Conclusion

  • There is potential demand from the NCCU students and Muzha residents to open a 2nd Run Movie Theater.

  • Opening a theatre close to NCCU may not be appropriate due to lack of accessibility to entertainment and other leisure related activities/businesses.

  • The alternative concept cannot be accommodated as customers are too price sensitive.




Other important findings3
Other Important Findings

  • 2nd Run Movies are less popular amongst target population

  • Competitors: DVD


Methodology2
Methodology

Conducted a survey to collect Primary Data:

  • Surveyed a total sample of 84 NCCU students and Muzha residents.

  • Excluded 9 surveys due to incomplete information.

  • A total of 15 questions were asked.


Cycle diagram

Add Your Text

Text

Text

Text

Cycle name

Text

Text

Cycle Diagram


Methodology3
Methodology

SAMPLE

SURVEY

LIMITATIONS

A total of 15 questions were asked:

10 – Movie Attributes

5 - demographic

Excluded 9 surveys due to incomplete information

A total sample of 84 NCCU students and Muzha residents


3 d pie chart
3-D Pie Chart

TEXT

TEXT

TEXT

TEXT

TEXT

TEXT


Marketing diagram
Marketing Diagram

Customer Segmentation

Residents

around the

area

Low

Income

workers

Families

&

Children

Students


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