Rogelio Vélez
Director General
View from the Top

From Cinema to a Comprehensive Entertainment Offering

By Gabriela Mastache | Sat, 12/28/2019 - 10:00

Q: Cinemex is the second-largest cinema chain in the country. What is the company doing to improve its position in the market?

A: We are moving forward with our consolidation strategy, trying to differentiate from our main competitor by implementing new concepts, providing better service and trying to show the movies that our guests want to see. An important concept we presented in 2019 is Cinemex Market, which showcases the changes we want our guests to experience. We associated with other companies so our guests can have the opportunity to have a Starbucks drink inside the movie theater, eat some Hooters’ wings or sushi from Moshi Moshi. The objective is to provide more options to our guests so they have a more interesting experience. Although the cinema industry in Mexico is dominated mainly by two players, the intensity of the competition between us has made the cinema industry in Mexico one of the best in the world and why we continue to strive to position our offering.

We have tried to differentiate our theaters in terms of comfort, location and movie offering. We have looked for ways to bring movies from different places in the world to our Art Cinema, which are exclusively shown by Cinemex in Mexico. Providing this cinema option to the people who look for it is another priority. Our 3,000 screens in the country give us the flexibility to do these types of things and to work for all types of audiences. We also have a project called Cinemex Alternativo, where we show NFL games, ballet, opera, concerts and other options that open up our portfolio of possibilities.

Q: How will Alboa, Cinemex’s new entertainment concept, revolutionize the industry and help you attract more clients?

A: Alboa has helped us to have more entertainment options at the best locations. We reach out to developers and offer them not only a cinema but the Alboa concept, which includes bowling alleys and a sports bar and makes us a highly attractive option. We also have another entertainment business called Arena, a concept based on videogames that is having a lot of success. Sometimes, we reach out to developers and offer them our entire entertainment portfolio. However, we have cases where developers reach out to us given our success. Considering that malls are becoming entertainment centers, they are becoming increasingly interested in having more entertainment options.

The market needs more entertainment options, which is why our Alboa and Arena concepts are key in this transformation. Our Prime and Live Alboa locations have a stage where artists can perform. These stages have significant production capabilities in terms of audio and video and have hosted concerts of popular artists, which attracts even more clients.

Q: What are Cinemex’s international expansion plans?

A: We are present in the US and need to continue working on the consolidation of our offering there. We have 39 locations with 401 screens, mainly on the East Coast and before the end of 2019 we will open three new locations. Cinemex is present in the states of Florida, New York, Minnesota, Illinois, Georgia, Maryland, Virginia, New Jersey and Colorado and we are looking at urban centers where we know we can position as a high-quality cinema brand. Although the US has a significant screen offering, we are differentiating our brand through new concepts. The US lags in terms of screen technology and experience while watching a movie. For instance, other cinemas do not offer wait services inside the theater; they have just started changing their seats to recliners. We are trying to expand in the US through a dining concept. People are going to the movies to have dinner and can even order a steak. While in Mexico we go to the movies to have popcorn, in the US they ask for a complete dinner. We are targeting a higher segment in important urban centers where we find the largest economic capabilities.

Q: How is Cinemex working to compete against the growing relevance of OTTs in Mexico?

A: We recognize Netflix as a competitor. What this and similar services are trying to do is make the consumer more comfortable at home. Meanwhile, we are trying to get people out of their houses. That is why we are investing heavily in concepts like Alboa, Arena and Cinemex Market, so people can change their usual environment. We are also working to ensure we have the best audio and video, with the best 3D and 4D offering along with CinemeXtremo, so people can experience something they cannot experience in their house.

Q: What are Cinemex’s growth expectations for 2019 and 2020?

A: We continue looking for locations where there are growth opportunities. There are places like Mexico City, Guadalajara and Monterrey where the screen offering is extremely high and opening new locations ends up impacting us negatively because we cannibalize our own business. For 2020, we also have an aggressive growth plan and we hope to open at least 20 new cinemas. In the US, we will also open at least four more branches in 2020.

Gabriela Mastache Gabriela Mastache Senior Journalist and Industry Analyst