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When we embark
on a strategy as important and big as we are planning, we always
bring it back to our vision and its key elements.
All Customers - when we take our
product to the market, we really want to make it available to
all our customers. That includes not only the white consumer
but more and more the black consumer.
A Memorable Escape - Even though
the product offering and environment will be different, when
the customer thinks about Ster-Kinekor and movies, it must be
something magical, it must be a memorable escape. We must never
loose sight of what the magic is, be it the excellent content
on screen or excellent service levels.
Time and Time Again - Currently
our customers come 3, 4 or 5 times, but with this new strategy
we aim to get them to go 6, 7, 8 times.
WHY THE NEW STRATEGY?
Cinema attendances in South Africa have
been static over the past few years. Our current pool of audiences,
traditionally the white audiences, is shrinking. This is largely
due to the vast choices of entertainment out there, i.e. TV,
Sport, etc. Also contributing, to the decline is that movie
going has become expensive.
Although currently our Black Market strategy
is progressing well, we are not at the levels we would like
to be. We simply don't have cinemas close enough to the audience
we are trying to reach and the black consumer finds it not only
difficult to get to our current cinemas but very costly.
For this reason we plan on, in the long
term, getting cinema closer to our audience and in the short
term make it more affordable for the new South African consumer.
Research
We have invested more than R1 million
over the past 2 years just on formal research. One key factor
from the research is that 42 % of our customers told us that
movie going has become too expensive.
Vitality
We have been running this partnership
for 2 years now where customers only pay R12 for a movie ticket.
Compared to our normal frequency of 3 to 5 times a year, the
Vitality frequency is averaging 9 times and sometimes as much
as 14 times a year. The lower pricing has definitely driven
the frequency.
The Pilot Sites
We launched a number of pilot sites (Carlton,
Sterland, Kenilworth, Southgate, The Wheel, Chatsworth), where
we dropped the prices as low as R10 to R12. A good example of
the impact of lower prices is Sterland. Sterland used to do
2 000 customer attendances a week on its 13 screens. Since changing
the ticket price to R10, Sterland is doing as much as 16 000
customer attendances a week.
Based on the research, Vitality and what
we have learnt from the pilot sites, we decided to embark on
an "affordable cinema" strategy. We are going to split
Ster-Kinekor into two main cinema chains.
· SK Classic
This is the upper end "glamour"
offering. There will be 7 sites, being the big sites like Sandton,
Brooklyn, Gateway, Cavendish, Cresta, Tygervalley and Eastgate.
They will remain at R35 but we will improve the offering. These
sites will offer reserved seating; we will change the look and
feel by bringing in new branding and new logos. Over time we
plan to fundamentally change the service offering. In essence
we want to offer - "cinema as it should be".
We'll have plasma screens in the foyer
showing stunning content and leather couches where our customers
can relax while waiting to go into their movie. The pay-off
line for Classic is "It's for the Experience".
For people who are a bit more discerning, who like the experience
as they know it. It's calm, relaxing and it's classic - it's
what movies should be.
· SK Junction
The remaining commercial sites will change to a "value"
offering. The most exciting element of these cinemas will be
the price. All these sites will now operate at R14. When we
get the kind of uplifts which we have had in our pilot sites,
this strategy has the potential of taking our customer attendances
from16 million to 25 million a year.
"Junction" is the new name
for these cinemas. It's a meeting place, it's vibey, there's
energy, it's exciting, a place to see and be seen and to meet
your friends. What we have used as a campaign line is "Movies
Unlimited". It's new content, it's hot and it's happening
and you get it for R10 - R14.
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MARKETING CAMPAIGN
You are going to experience one of the
biggest media campaigns ever undertaken in Ster-Kinekor. It's
telling all movie lovers about Ste-Kinekor's new strategy and
ensuring that everyone in South Africa is as excited about it
as we are.
The teaser campaign is called
"The Big Secret" and we broke on 11 March 2005
telling people that Ster-Kinekor is bringing you "The
Big Secret". This will tell customers something is
coming, but we won't give any details.
The launch campaign kicks off
on Wednesday 16 March 2005 with a press conference, where we
will announce what we are doing and what our wonderful news
is. The main campaign will be launched on Thursday 17 March
2005. We have secured 2 days of blanket coverage of all media
and from Thursday you will see it in all press from newspapers,
magazines, TV and radio. You will hear a spot every single hour
throughout the day and night. Ster-Kinekor's message will be
everywhere!!
OPERATIONAL EFFICIENCIES
Critical to the success of this strategy
is our ability to deliver on our promise of a memorable escape.
To achieve this we need to ensure that we strengthen and adapt
our areas of excellence.
Perfect Presentation
As market leaders it is our obligation
to make sure that it is always better on our big screen. This
means that every film should start on time every time. The house
lights and music should synchronize perfectly. The air-conditioning
should be at a perfect setting. The sound should be fantastic.
It also extends to the look and feel of our cinemas.
To this end at our Classic sites, we
are introducing new menu board concept as well as plasma screens.
Additionally we are busy with, what has affectionately become
known as the "spit and polish" project to enhance
the appearance of all our sites.
To sustain this we have introduced formalized
facilities management. The purpose of which is to take out the
hassle factor of managing and sustaining our wonderful cinemas.
Transaction Processing
This is our ability to take people from
box office or ticket line through to catering into the cinemas
and out again as efficiently as possible without compromising
on quality. In anticipation of the increased attendances we
are busy with the roll-out of VORTO (the new ticket selling
system) and self service terminals. This will help reduce queue
times as well as transaction times.
Control
We are a cash business and we also have
high levels of easy moveable stock. We also have the challenge
of widely spread cinemas from a geographic perspective. To assist
with this, we are introducing state of the art surveillance
which is intended to protect both the assets as well as the
interest of all staff. We will also introduce the roll-out of
G2G intervention packs and more specifically the administration
pack that is intended to simplify the admin process and therefore
reduce risk.
Customer Service
In the future we will hear a lot about
this as this will provide us with a competitive edge. We have
had lots of fun measuring queue times, measuring transaction
times and this has resulted in shortened queues, however we
have a long way to go. It is critical that we apply these learnings
and principles and ensure that the minimum standards are maintained.
This includes immaculate cinemas, short and fast queues, applying
the figure of 8, perfect screen presentation, etc. The concept
of trailering is still the most important marketing tool we
have and it's important that we get people through timeously
to watch those minimum 8 minutes of trailers.
UNIFORMS
Along with the new look of the cinema
we will be introducing exciting new look uniforms for both the
Junction and Classic sites.
The new strategy will launch on
18 March 2005 and is going to be the most exciting time in the
history of Ster-Kinekor. It's going to be hard work and there
is still a lot to learn, but we are confident that this is going
to put us onto a new growth path where we can really take our
Vision and turn it into Reality.
Ferdi
If you have any questions,
queries, comments or views on the new strategy:
Send e-mail to stratmail@sterkinekor.com
Fax - 011 - 444-0913
Contact your General Manager of HOD
Check the intranet
at www.sterkinekor.net
for responses to all questions.
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