HANOI UNIVERSITY

FACULTY OF MANAGEMENT AND TOURISM

SERVICES MARKETING
REPORT OF NATIONAL CINEMA CENTER

Lecturer: Phan Thị Kim Ngân

Tutor: Trần Thị Thanh Thư

Group: U30
Members: 2204050021 - Trần Ánh Dương
2204050028 - Phạm Hồng Hoa
2204050043 - Nguyễn Thị Ngọc Mai
2204050048 - Nguyễn Hà Ngân
2204050061 - Nguyễn Thu Phương

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EXECUTIVE SUMMARY
The population of Vietnam is steadily increasing, with the majority being young people. This
demographic has a high demand for entertainment, leading to a thriving market for artistic
entertainment, especially cinema. The National Cinema Center (NCC) is one of the most
renowned providers of cinema services in Vietnam. Established in 1997, it has been a
familiar destination for many Vietnamese moviegoers over the years.

The purpose of this investigation is to analyze the demand patterns of NCC and examine the
strategies employed to address changing demand, with the aim of providing
recommendations for optimizing its operation as well as that of other cinema.

In the first section, we analyze the demand patterns of the NCC based on daily, weekly,
seasonal, and other influencing factors, explaining the fluctuations in demand and determine
some challenges they may face with fixed capacity. We then investigate how the National
Cinema Center deals with demand fluctuations through 5 strategies regarding pricing,
promotional programs, adjusting screening slots, diversifying services offerings, adopting
technological progress. We also identify problems that the National Cinema Center
encounters when faced with significant changes in demand. Finally, we provide
recommendations to help the National Cinema Center address the challenges they may
encounter due to demand fluctuations.

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 TABLE OF CONTENTS

EXECUTIVE SUMMARY......................................................................................................2
I. Company Introduction.........................................................................................................4
II. The National Cinema Center’s demand pattern and influencing factors......................4
1. Demand pattern by time in a day........................................................................................4
2. Demand pattern by day in a week......................................................................................4
3. Demand pattern by season..................................................................................................5
4. Demand pattern by random changes..................................................................................5
5. The challenges of different demand patterns on the fixed capacity...................................6
III. The National Cinema Center’s strategies to meet demand variation...........................6
1. Adjusting screening slots....................................................................................................6
2. Pricing strategy...................................................................................................................7
3. Promotion strategy..............................................................................................................8
4. Diversifying services offering............................................................................................9
5. Adopting technological progress........................................................................................9
IV. Recommendations to deal with fluctuating demand....................................................10
1. Upgrade technology..........................................................................................................10
2. Adjust screening slots to audience’s demand...................................................................11
3. Offer discount to more audienees.....................................................................................11
V. Conclusion..........................................................................................................................11
REFERENCE.........................................................................................................................12

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I. Company Introduction

The National Cinema Center was established in 1977 by the Ministry of Culture, Sports, and
Tourism. It is known as one of the oldest and most famous cinemas in the capital city of
Hanoi. This cinema belongs to the Ministry of Culture, Sports, and Tourism. The National
Cinema Center currently has a system of over 10 modern movie theaters that meet
international standards. Today, it is one of the leading entities in cinema services. With
relatively low ticket prices compared to other cinemas in Vietnam, the National Cinema
Center targets individuals with low to medium incomes. In just the first six months of 2023,
the National Cinema Center served 750 thousand audiences and earned 60 billion VND from
its cinema activities.
II. The National Cinema Center’s demand pattern and influencing factors.
1. Demand pattern by time in a day

The time of day a movie is shown significantly impacts customer demand at the cinema.

For families with young children, mornings and afternoons reign supreme. Early bedtimes for
little ones dictate these preferences, ensuring a smooth transition from the cinema to home
without disrupting sleep schedules.

Teenagers and young adults have more flexibility but gravitate towards evenings. This
timeframe offers them a welcome break from school or work . Similarly, evenings become
prime time for adults seeking leisure activities. After work, this window provides free time
for socializing with loved ones or enjoying some solo moviegoing as a form of relaxation and
escape.

Adult preferences encompass a wider range. While evenings are undeniably popular for
social moviegoing, afternoons or late nights can be equally appealing for some. These
showtimes offer a quieter and less crowded atmosphere, perfect for those seeking a more
immersive viewing experience. Adults with flexible work schedules or night-shift jobs might
also find afternoons or late nights more convenient than evenings (Thanh Nam, 2023).

Senior citizens, another valuable customer segment, often prioritize mornings or afternoons
for similar reasons. Avoiding crowds and late-night navigation, especially for those using
public transportation or walking long distances, makes these earlier showtimes more
attractive. They can enjoy a quieter environment and the movie itself without compromising
their safety or sleep routines.

2. Demand pattern by day in a week

The demand for movie theaters in Vietnam differs significantly during the week. Weekdays
typically witness a moderate level of viewers. Conversely, weekends experience a significant
increase in attendance, marked by higher occupancy rates and increased ticket sales.

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Most customer segments are tightly restricted by work and school commitments, which
leaves them with less free time for leisure activities like going to the movies. Consequently,
the number of moviegoers during the week remains fairly steady but tends to be lower
overall. In contrast, weekends offer individuals more leisure time, which increases the
demand. Moreover, following a busy week, people look forward to relaxing and being
entertained during the weekend, with watching a movie being a popular way to unwind.

Cultural norms and social preferences also play a role, as weekends are traditionally
associated with social gatherings and entertainment activities in Vietnamese culture. It is
further evidenced that the majority of people visit the national movie center with their
friends, accounting for up to 60% (Q&me, 2019). Because it is simpler to make plans for
groups from Friday to Sunday, movie theaters at that time benefit from a larger crowd and
increased ticket sales.
3. Demand pattern by season

The demand for watching movies of Vietnamese people often increases during important
holidays compared to normal days of the year

Holidays offer a significant break from work and school routines, creating abundant free
time. This naturally drives a desire for leisure activities. Watching movies provides a perfect
escape, allowing relaxation and shared experiences with family and friends.

Movie studios also capitalize on this increased demand by strategically releasing blockbusters
during holidays to align with the heightened enthusiasm for cinematic experiences among
audiences. This approach guarantees a ready audience, eagerly anticipating entertainment
options during their leisure time, thereby maximizing the commercial potential of these
blockbuster releases.

Cinemas further amplify the appeal with targeted marketing campaigns. Eye-catching
commercials, online ads, and social media promotions all work together to increase
awareness of new releases.

Box Office statistics show a sharp rise in movie demand during holidays like Lunar New
Year, National Day, and Valentine's Day. This trend is evident in the recent Lunar New Year,
where ticket sales in Ho Chi Minh City and Hanoi jumped 30% compared to usual days, with
significant increases in advertising and online ticket revenue as well. In particular, according
to a 2024 survey by NCC Cinemas, movie ticket sales during Tet increased by 180%
compared to regular weeks. This coincides with the release of the film "Dao, Pho, Piano"
which grossed over $2 billion after 15 days releasing during the holiday period (Hồ, 2024).

4. Demand pattern by random changes

Surprise blockbusters significantly impact cinema demand, challenging predictions due to
their lack of traditional success markers like star power or extensive marketing. "Hai
Phượng" (Furie), featuring Ngô Thanh Vân and released in 2019, serves as a prime example.

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Its unexpected success, driven by compelling action and a strong female lead, led to high
attendance and outperformance in the Vietnamese market.

The viral nature of social media can cause sudden shifts in consumer behavior. "Đào, Phở và
Piano," a war-themed film commissioned by the state and launched without marketing
exemplifies the impactful role of social media trends in shaping cinema demand patterns.
Despite its low-key release, the film's popularity surged on social media following a widely
shared clip, leading to a sudden increase in cinema attendance (Hoàng, 2024).

Weather significantly affects how many people go to the movies (Nguyễn, 2019). According
to Gilchrist and Sands (2016), bad or extreme weather leads to more people choosing to
watch films indoors, increasing cinema visits.

5. The challenges of different demand patterns on the fixed capacity

It's worth noting that movie theater seats are perishable inventory. Furthermore, unlike other
services such as hotels or airlines, theaters cannot enable consumers to overbook, making it
more difficult to adjust to rapid fluctuations in demand. As a result, different demand patterns
might represent a significant risk to service providers if they are unable to manage the fixed
capacity. Failure to manage capacity alongside fluctuating demand can result in long wait
times and overcrowding during peak periods, leading to dissatisfied customers and lost sales
opportunities. Conversely, maintaining excess capacity during low-demand periods can
increase operating costs and hinder profitability. In the long run, inconsistent service quality
may harm the reputation, impacting customer loyalty and brand image.

III. The National Cinema Center’s strategies to meet demand variation

1. Adjusting screening slots
The National Cinema Center's initial response to escalating demand for the film "Đào, Phở và
Piano" involved augmenting its screening frequency from a handful to between 18 and 20
sessions (Dung, 2024). Subsequently, due to the heightened demand for this particular movie,
the center strategically redirected screening resources from another film, "Mai" by Trấn
Thành, towards "Đào, Phở và Piano." As demand persisted, the screening count for the film
was further increased to 30, with anticipations of continued growth in the immediate future.

This sequence of actions represents the cinema center's implementation of a capacity

stretching strategy, aimed at effectively reallocating existing resources and modifying
screening schedules to optimize service delivery and align with consumer interest.

The need for operational agility in rapidly adjusting these schedules presents a potential
challenge, especially for cinemas facing limitations in screen availability or requiring close
coordination with film distributors. Nonetheless, despite these efforts to meet consumer
demand, the cinema encountered difficulties in fully addressing the abrupt surge in patron
interest, resulting in extended queues of individuals awaiting ticket purchases.

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2. Pricing strategy

The National Cinema Center has applied various pricing strategies based on time of day.
Typically, ticket prices are lower throughout the week than on weekends, lower in the
morning and higher in the evening, or higher on holidays.

This approach can alter the demand to best fit the fixed capacity of the theater, with several
advantages. By offering lower prices on weekdays, theaters can potentially increase
attendance during off-peak hours, optimizing capacity and revenue. In a market like Vietnam,
where weekends and holidays often see a surge in moviegoers, promoting weekday
attendance is crucial for sustaining business viability.

However, the effectiveness of such pricing strategies is dependent on knowing local

consumer behavior and market dynamics, since research has shown that price sensitivity is an
important factor to consider when developing different prices (Kotler, Armstrong, and
Opresnik, 2017). Vietnamese moviegoers, in particular, may demonstrate varied levels of
price sensitivity; for example, students are more sensitive to modest price differences
between weekdays and weekends, but many individuals are unconcerned about such
adjustments. Hence, pricing strategies must resonate with the segmentation to tailor to
specific target audiences.

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3. Promotion strategy
The National Cinema Center has implemented two promotional strategies to target specific
audiences and potentially increase ticket sales.

Recognizing students as a price-sensitive demographic, the National Cinema Center has

initiated a targeted discount policy to make moviegoing more accessible. This strategy offers
a discounted student ticket price of 55,000 VND for 2D movies, directly catering to the
budget-conscious needs of this customer segment. The second strategy focuses on a special
"Special Monday" promotion, offering a flat rate of 50,000 VND for all 2D movie tickets on
the last Monday of the month (Trung Tâm Chiếu Phim Quốc Gia, n.d). This strategy aims to
attract customers on a traditionally slow day and potentially create a habit of Monday
moviegoing.

Discounted student tickets and "Special Monday" pricing make moviegoing more accessible
for budget-conscious individuals, particularly students. Additionally, both strategies
showcase targeted marketing. Focusing on demographics with potentially higher interest, like
students and moviegoers on Mondays, can maximize the impact of the promotions and create
a loyal customer base who frequent the cinema specifically on Monday. “A company should
target segments in which it can profitably generate the greatest customer value and sustain it
over time” (Kotler et al., 2023).

However, promotions exclude other demographics, potentially missing out on a larger market
segment. Similarly, "Special Monday" is restricted to a single day per month, limiting its
overall impact. Profit margin is another factor to consider. Discounted prices can decrease
the revenue generated per ticket.

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4. Diversifying services offering
National cinema centers not only serve as venues for film screenings but also extend their
services to include additional offerings such as souvenir sales, fast food catering, and
entertainment gaming zones (Mytour, n.d.). This diversification of services aims to broaden
their customer base and attract new potential clients. This strategy is particularly effective in
responding to fluctuations in demand within the entertainment industry. By providing
supplementary services alongside their core product, cinemas can adapt to varying consumer
preferences and market conditions. During peak periods, such as weekends or holidays,
ancillary services contribute to enhancing the overall customer experience and alleviating
congestion within the cinema premises. Conversely, during quieter times, these diversified
offerings serve as an attraction, drawing in customers who may not have intend to watch
movies. Moreover, the inclusion of supplementary services add value to the core product
which is film screening (Wirtz and Lovelock, 2018). However, cinemas must maintain a
balance between their core product of film screenings and the supplementary services
provided, ensuring that the cinematic experience remains paramount.

5. Adopting technological progress

The NCC has implemented an online ticketing system and installed self-service ticket
booking machines for its customers. This measure aims to alleviate staff workload during
peak periods and reduce customer wait times. However, occasional website crashes occur due
to an overwhelming volume of traffic, such as multiple users attempting to book tickets for
popular movies like "Đào, Phở và Piano" , resulting in website downtime (Sang, 2024). On
the positive side, the online ticketing system and self-service machines enhance operational
efficiency by streamlining the ticketing process and providing customers with greater
convenience. Moreover, the system's scalability allows for more flexible handling of demand
fluctuations. However, the reliance on technology exposes the cinema to technical issues,
including website crashes, which can disrupt service delivery and potentially lead to negative
Word-of-mouth. Furthermore, accessibility concerns may arise for customers who are not
accustomed to or lack access to online booking methods.

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 NCC’s Service Blueprint

IV. Recommendations to deal with fluctuating demand

1. Upgrade technology
To address the problem of websites and apps being crashed , we suggest that the Nation
Cinema Center should expand system processing capability by utilizing more powerful
servers with higher processing capabilities to accommodate sudden spikes in traffic or add
more servers to the system to distribute loads and increase parallel processing capabilities.
Large e-commerce platforms and event ticketing websites often use a system that
automatically balances traffic across servers to avoid congestion and crashes. Moreover, the

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NCC can collaborate with e-wallets, banking apps like Vnpay, Momo,... to sell tickets online
and share traffic.
2. Adjust screening slots to audience’s demand
In dealing with the challenge of sudden demand spikes for films, such as "Dao, Pho, and
Piano," the National Cinema Center's strategy of merely increasing screenings proves
insufficient. A strategic approach involving reserved screening allocation and enhanced
customer communication is recommended. Specifically, the cinema should designate a
proportion of screenings exclusively for online reservations, ensuring equitable access for
both pre-planned and impromptu cinema visits. Concurrently, leveraging digital platforms for
proactive communication about peak viewing times and anticipated wait periods can
effectively manage audience expectations and encourage attendance during less congested
screenings. By minimizing congestion and cutting down on wait times, this dual approach not
only optimizes attendance distribution throughout various showtimes but also improves the
entire viewing experience.
3. Offer discount to more audienees

Following Kotler et al.'s (2023) emphasis on customer value – “according to the principle of
customer-value marketing, the company should put most of its resources into customer value-
building marketing investments”, the National Cinema Center can enhance its promotional
strategy by implementing a two-pronged approach.

Firstly, expanding targeted demographics beyond students would maximize the reach of these
promotions without compromising affordability. Offering similar discounts to young
professionals, seniors, or families on specific days caters to a wider range of budget-
conscious segments. This diversification increases the customer base and capitalizes on
existing infrastructure, maximizing the value proposition for both the National Cinema
Center and its patrons.

Secondly, introducing tiered discounts on "Special Monday" based on showtime fosters a

more dynamic approach. Offering higher discounts for earlier shows incentivizes attendance
during traditionally slow periods, ultimately increasing overall customer value. This strategy
not only broadens appeal but also optimizes resource allocation by filling up less popular
time slots. By implementing these recommendations, the National Cinema Center can create
a more sustainable and value-driven promotional strategy, aligning perfectly with the core
principles outlined by Kotler et al. (2023).

V. Conclusion

In conclusion, the analysis of the National Cinema Center's demand patterns and strategies to
address fluctuations provides valuable insights for optimizing operations in the dynamic
cinema industry of Vietnam. By understanding the diverse preferences of their customer
segments and implementing agile strategies such as adjusting screening slots, pricing tactics,
promotions, diversifying services, and embracing technological advancements, the National

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Cinema Center can better meet fluctuating demand and enhance the overall customer
experience. However, challenges remain, particularly in effectively managing fixed capacity
and technological infrastructure. Therefore, we have recommended some approach such as
technological upgrades, audience-driven scheduling adjustments, and expanding promotional
efforts to diverse demographics are crucial for ensuring sustained success. We hope that this
report is valuable for people in movie industry especially cinema systems in Vietnam.

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