Individual STEPP Assignment
Paper Due Date
Introduction
Founded by Arthur Russel back in the 1920s as a short films cinema, The Hoyts Group today is an Australian Group of companies, operating 10 cinema complexes in New Zealand alone. The company is continuously diversifying and innovating its business, bringing to the market such solutions as Hoyts Distribution, the largest independent film distributor in New Zealand and Australia and Hoyts Kiosk. Under the growing pressure of internet streaming, the company is planning to launch their own streaming service, according to the CEO Damian Keogh. In 2015, Hoyts Group was acquired by Wanda Group (Reuters 2015).
STEPP Analysis
Social factors
Over the decades, multi-screen complexes started to emerge and shape the industry in the country, which transformed business and culture in New Zealand. Contemporary social profile of the user, however, outlines several major trends, which build on industry outlook (Statistics New Zealand 1):
Home streaming often becomes a substitute towards out-of-the-house film experience.
Price-sensitivity drives the behavior of average consumer in New Zealand in a way that people often prefer streaming and affordable DVDs to the cinema complex experience.
One-stop-shopping solution search is a common trend among the juvenile population in the country. That said, young people often opt for experience, which not only offers a possibility to watch a film outside of their home but combines it with shopping and eating out. This continues building on differentiation strategies from large cinema complex owners.
Technology
Technology plays an important role in shaping the cinema and streaming industry in the country. Three major trends have been identified as they relate to the future outlook of the same:
Internet-based services are more accessible, offering high-quality product and service solutions.
Technological advancements improve the quality of the services and customer experience in cinema complexes.
Growing use of smartphones and tablets demand companies in the industry invest in Research and Innovation.
Economic Factors
The economic environment is a strong macro factor, shaping the development of the industry.
Economic stability creates consumer confidence and brings higher investment and growth to the sector. As such, this can be seen in the development of streaming sector and applications for the film industry in the country.
Globalization provides the companies with wider access to the international products, which makes the companies more competitive on the international market.
General infrastructure in the country, affected by urbanization projects allows development of the industry not only vertically but also horizontally.
Political Factors
The low government involvement in the activities of the companies within the film sector, allows outlining the following trends:
The industry is considered relatively open to new entrants, limited majorly by the size of the initial investment. With that in mind, a number of small streaming and “kiosk” style companies can compete with multinational corporations in particular niche segments.
Trade regulation and license restrictions are relatively low, making cinema industry in New Zealand one of the most up-to-date in terms of titles.
Labour law protects the employer by offering reasonably flexible working contracts and brings in stability to the sector as there is no evidence of significant.
Environmental Factors
The environmental factor is one of the elements that should be considered in a long-term, rather than seen as an immediate influence on the film industry.
Climate change is an important factor, which outlines the future of the industry by determining the types of fisical facilities preferred by the market (Ministry of Economic Development 3-4).
Environmental concerns raise higher awareness and expectations in terms of companies´ operations in the market. This drives Social Responsibility and other environmental initiatives in the sector.
International regulations and activities of the organizations associated with environmentally friendly businesses affect the downstream costs and even content of the products, brought to the final consumer.
Works Cited
Statistics New Zealand. “Key Facts”. Statistics New Zealand, Tatauranga Aotearoa. Web 13 Apr 2016. <http://www.stats.govt.nz/browse_for_stats/industry_sectors/film_and_television/ScreenIndustrySurvey_HOTP14-15.aspx>
Ministry of Economic Development. "Growth and Dynamics of New Zealand Screen Industry." Ministry of Economic Development. April 2012. Web 13 Apr 2016. <http://www.mbie.govt.nz/info-services/sectors-industries/screen-industry/documents-image-library/Economic%20study%20of%20the%20New%20Zealand%20film%20industry%20-PDF%201.1%20MB.pdf>
Reuters. "RPT-China's Dalian Wanda buys Australian cinema chain Hoyts". Reuters. 2 June 2015. RetriWeb 3 June 2015. <http://www.reuters.com/article/hoytsgroup-ma-wanda-cinema-idUSL3N0YO5RG20150602>
