National CineMedia plans programmatic advertising in movie theaters

Article by Sara Lebow | Aug 7, 2023

National CineMedia (NCM) announced Monday that it will sell movie screen inventory programmatically starting in Q4 of this year.

NCM reaches 20,300 screens in 1,600 theaters across the US, according to the company.
The programmatic ads would leverage its NCMx data and analytics platform, which debuted during the 2022 upfront season.
The ad company faces an uphill climb after filing for bankruptcy in April of this year.

Most US programmatic display ad spend growth comes from video, which will grow 30.2% between 2023 and 2025 for a total of $96.98 billion, per our forecast. NCM wants in on that growth.

Will NCM’s programmatic ads win over advertisers? It’s hard to say.

NCM boasts something that streamers can’t: Its theater ads aren’t skippable or mutable.
NCM can also be certain of exactly where viewers are and what their watching behaviors are, reducing some of the uncertainty of other forms of programmatic advertising.
But it’s unclear how moviegoers would opt into sharing data with NCM. The movie theater isn’t a place where consumers expect to see personalized ads, and retargeting (serving customers ads for products they’ve already engaged with) could creep out moviegoers.

“Whenever ‘opted-in’ is casually thrown in next to ‘geolocation data,’ my eyes narrow,” said our analyst Evelyn Mitchell-Wolf. “Advertisers should always be asking tough privacy questions where retargeting is involved.”

Plus, there’s the question of audience: Movie theaters are struggling as people continue the pandemic behavior of watching movies in their homes. With that being said, people are returning to theaters.

Midsummer box office sales were down 2% from 2022, per Comscore as reported by Deadline.
Movie theater tickets were the No. 1 expense US adults cut back on due to inflation, according to a March 2023 survey from Morning Consult.
But there’s good news too. “Barbie” reached $1 billion at the box office last week, becoming the first Warner Bros. movie to sell so many tickets so fast, per the studio as reported by The New York Times.