Question

Explain and Review of Cinemark's Current Strategies and what is the Issues with Current Strategies?

Answer 1

Cinemark is an America movie theatre chain operating in America, Taiwan and Brazil; it is headed by Mark Zoradi.

The current strategies of Cinemark are discussed below:

• Regularly providing access to newest movies and content from Hollywood studios to people.

Cinemark provides all the new releases of Hollywood in its theatre, as soon as the movie is released people can go visit and watch it in a Cinemark theatre, with this Cinemark creates an image in the minds of its customers that this theatre always provides them with the newest content.

Issues: Since the time taken by Hollywood to release the movies for home viewing experience has reduced substantially and online content providers like Netflix has emerged, it has proved to be problematic for Cinemark. The number of Cinemark viewers is going below with an annual rate of 2 per cent.

• To provide larger than life and quality movie viewing experience

Cinemark has always believed in providing moviegoers with experience which is unique and world class quality at their theatres, this has kept its market share intact.

Issues: With the advent of home theatre systems and affordability towards it has reduced the number of people who used to visit theatres to watch movies as the overall consumer perception has changed and people now believe that they can create a theatre like experience at home.

• To provide huge discounts on cinema tickets

Cinemark's one strategy was to provide huge and delicious discounts on its dramatically overpriced tickets.

Issues: The consumers have now understood that the tickets are intentionally overpriced and discounts are provided on it to attract more customers as well as other movie theatres are also offering same type of discounts so this has not remained a key factor to attract customers.

The above discussed strategies have some issues which Cinemark is trying to overcome in the following way:

• Cinemark has expanded its market and now is available in Latin America as well where the penetration of internet media is low and people are still going to movie theatres wo watch movies. After the shrink in market in the US this is a good strategy to expand to other markets in order to have sustainability.
• Cinemark has recently invested in new technologies like 3-D theatres and IMAX style screens in the US which can't be recreated at home and that can attract customers to Cinemark's movie theatres. The company is charging a premium for these tickets.

By changing its strategy according to the market Cinemark has been able to maintain a strong revenue and growth despite the decrease in number of cinemagoers.