Boxoffice® Pro - February 2014

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EXECUTIVE SUITE Setting standards NATO’S IN-THEATER MARKETING GUIDELINES TAKE EFFECT by John Fithian, President and CEO, NATO, and Brigitte Buehlman, Director of Industry Relations, NATO The Executive Board of Directors of the National Association of Theatre Owners (NATO) voted to adopt a guide that will standardize in-theater marketing materials with the goal of driving movie ticket sales and creating a better moviegoing experience. Announced in late January 2014, the voluntary guidelines went into effect immediately for any advertising campaigns being developed for movies scheduled for domestic release on or after October 1, 2014. (Advertisements already in cinemas for such movies at the time the final guidelines were announced will be grandfathered.) n The process of creating these guidelines was not an easy one. In April 2013, NATO’s executive board voted to move forward with creating industry-wide guidelines to encompass marketing lead time for in-theater marketing materials; trailer length and placement; guest engagement methods; and film checker/auditor conduct. NATO met with the largest seven studios later in 2013 to discuss the guidelines. After some very engaged conversations, NATO took the constructive feedback we received and made significant modifications to the draft guidelines. Specifically, NATO substantially lengthened the marketing lead time requirement; added two exemptions per distributor per year for both trailer length and marketing lead time; and made other changes. A copy of the revised and final guidelines as adopted by the NATO Executive Board of Directors accompanies this article. Highlights from NATO’s In-Theater Marketing Guidelines include: All in-theater marketing materials should include the targeted theatrical release date of the film/event once the release date has been set. Cinemas will advertise a wide-release movie no sooner than 150 days with trailers and 120 days on all other marketing materials before its theatrical release date. The final guidelines permit two exemptions per year per distributor based on the theatrical release dates for two movies. Trailers shall not exceed two minutes in length. The final guidelines permit two exemptions per year per distributor, with a maximum length of three minutes. NATO members appreciate that their studio partners strive to make the best use of marketing dollars by developing and distributing effective advertising materials to sell their movies. For the cinema environment, though, some marketing materials can be distributed too early to be optimally effective, and some trailers can be too long. Given the limits of time and space in theaters, and the desire to maximize sales to all movies in a fair and competitive environment, exhibitors believe these new guidelines can help the entire industry sell more tickets. Movie distributors own their movies. Motion picture exhibitors own their theaters. Exhibitors license the right to play features. But the time on screen before the feature, and the available space throughout the cinema complex, are owned and managed by the exhibitor. NATO’s members do not exercise any control over movie advertisements in other media outside of the cinema environment. To maximize the industry’s marketing efforts and to best promote competition, however, exhibitors must set the parameters for advertisements in their own cinemas. NATO, on behalf of our executive board and general membership, emphasizes that these guidelines will evolve in response to technological innovations, marketing and advertising trends, competition in the marketplace, and consumer demands. Furthermore, the guidelines are completely voluntary and will be implemented through individual exhibition-company policies, which may vary. NATO will serve simply as an information clearinghouse where distributors may notify the industry of their desire to exercise an exemption under the guidelines. Questions regarding the guidelines can be directed to Brigitte Buehlman at bgb@natoca. com. NATO IN-THEATER MARKETING GUIDELINES MARKETING LEAD TIME All marketing materials (trailers, printed materials, standees, digital posters, clings, display cases, mobiles, and all other in-theater advertising) should include the targeted theatrical release date of the film/event once the release date has been set. Cinemas will advertise a wide-release film/event no sooner than 150 days with trailers and 120 days on all other marketing materials before its theatrical release date. • Two exemptions per year per distributor (exemptions are granted per title and not per marketing material), based on theatrical release date. • Advance notification of the intended use of an exemption must be given to NATO via exemption@natoca.com. IN-THEATER PROMOTIONS & EVENTS All film marketing promotions and events (including project pictures and special screenings) require exhibitor home office approval. Please refer to individual exhibitor policies regarding approval, insurance, participation, etc. PRINTED AND DIGITAL MATERIALS AND STANDEES Negotiations of marketing materials will be coordinated between the distributor and the exhibitor’s home office. Installation of marketing materials will be coordinated between the installer and theater management. TRAILERS Two-Minute Trailer Length Limit Trailers shall not exceed two minutes in length. Two exemptions per year per distributor, with a maximum length of three minutes, based on the theatrical release date of the film being advertised. 10 BoxOffice ® Pro The Business of Movies FEBRUARY 2014
BULL’S-EYE HOW THE TARGET DATA BREACH OFFERS A REMINDER TO PROTECT YOUR BUSINESS FROM CREDIT/ DEBIT CARD THEFT by David Binet, Director of Membership, NATO Advance notification of the intended use of an exemption must be given to NATO via exemption@natoca.com. Any on-screen marketing materials that are considered special content (behind-the-scenes footage, sizzle reels, extended looks, etc.) must be negotiated with individual exhibitors. Trailer Placement Exhibitors will only place trailers with content appropriate for the particular feature (expands on ratings match currently in place). NATO encourages its members to follow the MPAA trailer placement advisories and NATO coordinates with MPAA on a regular basis to communicate this information in a timely manner. No third party brands/endorsements (video games, television shows, etc.) are to be embedded. On-screen marketing materials should be thematic to the feature. Trailers, whether attached or not, are played in theaters at the discretion of each theater chain or individual theater owner. (See MPAA Marketing Administration guidelines.) Trailer Standards Industry standard trailer ID/naming convention is to be used by the distributor in order to facilitate programming/playlist assembly at the theater level. No direct response prompts (QR codes, text-to, sound recognition, etc.) other than URLs are to be placed in/on the trailer, as they encourage mobile phone use during the show. Distributors must make trailers available in both flat and scope so that exhibitors may match the trailer’s format to that of the feature. FILM CHECKERS & AUDITORS Required to check in with theater management when they arrive at the theater before starting their inspection. They must be professional in dress and demeanor, and be respectful of the management team’s time. Any information requested will be provided at the manager’s convenience once all guests have been handled. Required to wear proper identification and have an approved letter from the distributor, or they will be asked to purchase a ticket. May not in any way affect the guest experience, cannot take up a seat in the auditorium, and cannot interact with guests. Once their official duty has been completed, they must leave the auditorium (they may not watch the film/ event). Film checkers and auditors violating these rules will be asked to leave the complex. n The recent 19-day breach of Target’s card-processing network is among the largest recorded data security breaches in the United States. It was a worse display of protection than the Miami Dolphins’ offensive line. This incident exposed the credit and debit card information of more than 40 million people who paid with plastic at U.S. Target stores between November 27 and December 15, 2013—you know, the busiest shopping days of any and every year. The information was stolen from all types of credit and debit cards. It’s a big enough crime to even prompt the U.S. Secret Service to get involved [cut to a sneering Clint Eastwood from In the Line of Fire]. Just a few days before Christmas, as naive consumers reportedly increased holiday spending by 2.3 percent, Target announced to the world how this incident unfolded: thieves stole account information by installing malicious software on the retailer’s checkout terminals, and then captured magnetic-strip data from customers’ cards—a process known as “skimming.” The data was then rerouted through an intricate system for the thieves to collect. It was an enormous and well-executed plan, prompting one reporter to say it required military precision. In the ensuing commotion after news reports surfaced, some creditors quickly canceled cards that had been used at Target stores. That amounts to a massive disruption in customer spending confidence, as well as potential damages for business. While a huge retailer like Target may escape any significant loss of revenue, the same isn’t necessarily true of your cinema operation. Target’s wasn’t the only publicly disclosed data breach during the year. According to a CNBC report, there were almost six hundred such data breaches in 2013. As a cinema operator (aka merchant), you need to get an education in the potential risks of data theft, especially with the continued proliferation of card purchases. Look, this subject is a veritable Pandora’s Box of scary stuff, but our industry needs to awaken to the realities of potential data theft. We’re already acclimated to the rigors of the joint movie-theft program with the studios; cinema employees across the country are trained to seek out camcorders. Now the industry must protect the loyal customers who attend our cinemas by learning more about credit/debit card theft, a blunt reality already experienced by one of your fellow NATO members. George Rouman (Rouman Amusement Company, Rhinelander, Wisc.) endured an ordeal this past spring regarding his card-processing system. According to the forensic investigation—yeah, it got that serious—Rouman’s network was compromised, sending data to various IP addresses throughout Eastern Europe. The thieves somehow infiltrated the system and stole customer data, allowing them to make several online purchases in France. It was like a twisted version of Taken, only without Liam Neeson’s particular set of skills to hunt down the thieves [cut to Neeson staring intently into the camera]. Luckily for Rouman, he had recently switched over to Vantiv for card-processing services, and they provide a Breach Assist program to cover any losses. Most card-processing companies provide such a service, so make sure that your card processor offers something similar, or you may be stuck with a hefty bill after a data breach. In order to better protect your cinema operation from a potential FEBRUARY 2014 BoxOffice ® Pro The Business of Movies 11
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Boxoffice® Pro - February 2014

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