Mgt Pre Questions Essay example

EdgeMark Cinemas are a chain of movie theaters located in 37 states with 475 theaters in those states covering the west coast, east coast, and Midwest. EdgeMark’s profits, like other cinemas, have been in a small but constant decline over the last 12 years. Industry Wide Average of 2.05% ticket sales decline per year for the last 12 years also, when adjusted for inflation, revenue has dropped an average of 1% a year for the past 12 years (Domestic Movie Theatrical Market Summary, 2015). The chain is currently looking to increase ticket sales, loyal customers, and profits by adding additional products and services.

The Canadian entertainment industry that is served by Cineplex has been recording sustained growth since 2011 where a growth of 5 percent was recorded. PwC’s Global Entertainment and Media Outlook for 2014-2018 (PWC, 2014) indicate that the industry is set for a take-off. The industry has a

American Movieplex, a large movie theater chain, leases most of its theater facilities. In conjunction with recent operating leases, the company spent $28 million for seats

Discuss the market factors (level 2). How do the relevant market factors affect the performance of the focal organization?

A tenet of that theory is that enlightened egoists will recognize that socially responsible behavior will benefit them.

{. How many consecutives years the company has been profitable, its current ration and its ROE

To provide an analysis and make recommendations to increase revenue in the movie exhibition industry.

A market analysis was first taken out on Reading Courtenay; one cinema under the Reading brand name situated in Wellington. From this analysis, it became apparent that the Internet was one of the company’s largest competitors. Upon further research, the problem revealed to be at such a large level, one single cinema would not be able to control it alone. The view for the marketing plan had to be changed and instead would now support a company-wide view.

By mid 2002, the company had 349 screens in 31 locations and had generated a reported compound annual rate of return well in excess of 20% for its initial investors. 2-for-1 Wednesdays In the spring of 2001, Cinemex’s competitors began offering a special deal: any customer who purchased a ticket to see a film on a Wednesday (traditionally a slow day at the box office) would receive a second ticket at no additional charge. This ploy cut into Cinemex’s attendance figures (Exhibit 3). On five of the first six Wednesdays after the deal’s introduction, Cinemex’s attendance was less than in the same week during the previous year. Heyman faced a difficult decision. Should he offer his own two-for-one deal on Wednesdays? This might raise attendance, but since many tickets would be given away for free, it might also reduce ticket revenues. Or should he do nothing, hoping that the appeal of Cinemex’s customer service package would eventually bring customers back? Heyman’s first step was to review his attendance data. What made this difficult was that week-to-week attendance was highly variable, depending on (among other things) the time of year, the popularity of current films, local weather conditions, and the timing of holidays. The question was how to disentangle the impact of these factors from those of Wednesdays at Cinemex Page 2

risen 20% -- an average of 2% a year -- over the past 10 years.

Cineplex is exposed to a number of external factors that have the potential to affect their performance. Changes to any federal, provincial and municipal rules and regulations related to Cineplex’s business can have an impact on their financial results. Cineplex’s business delivers guest experiences rather than physical commercial products and thus does not present the company with a substantial environmental risk (Cineplex, 2016, p.40). If the law were to change and "require a more stringent management of carbon emissions or more stringent reporting of environmental impacts”; Cineplex anticipates a slight increase in costs and changes to operating procedures (Cineplex, 2016, p.40).

2. What forces are driving changes in the movie rental industry? Are the combined impacts of these driving forces likely to be favorable or unfavorable in term of their effects on competitive intensity and future industry profitability?

Competition between theaters often comes down to distance from home, convenience of parking and proximity of restaurants. Innovations by one theater chain are quickly adopted by others. The differing approaches of the theater chain companies are reflected in their cost of fixed assets per screen.

1. How might the reward program described in case exhibit 5 affect the movie and event –going behavior of major market segments? At retail, what is the average value of each reward structure for customer’s dollars spent – 5 %, 10%, 15% or 20%? Which reward structure would you choose? Why? (For the sake of simplicity, ignore the one-time fees and rewards)?

The main purpose of this paper is to show how Blockbuster is using information technology to gain a competitive advantage, and if it has in fact achieved a competitive advantage. The first section of the paper is an industry analysis detailing the ins and outs of the movie rental business. The next section, Company Analysis, we will describe in