National CineMedia, Inc. and Screenvision Respond to Justice Department Action
~ Companies Defend Their Merger~
~ Combined Company Will Benefit Advertisers and Theatre Circuit Partners~
NCM Chairman and CEO
Benefits of the Combined Company
Advertisers place a premium value on reach. The merger will increase the number of theatre attendees reached by approximately 60%, allowing NCM 2.0 to offer a greater number of the advertising impressions that will be more competitive with cable and broadcast TV networks and online and mobile video advertising platforms.
Advertisers value ubiquitous audience coverage. NCM and Screenvision's competitors including TV broadcasters, many cable programmers and virtually all the online and mobile advertising platforms have ubiquitous national reach. This limits NCM's and Screenvision's current ability to compete for the budgets of national brands, most notably QSRs, Retailers and CPG brands who have businesses with national distribution (or store) networks that require their advertising to be in virtually all markets in which they operate. The merger will allow the combined company to offer advertisers the ubiquity they require.
Ability to Target Specific Audience Demographics
Advertisers prefer to buy a network that can provide a high percentage of a specific age or gender demographic group (e.g. Female 18-34); audience members outside that target represent waste that is inefficient for the advertiser and the network. Neither NCM nor Screenvision alone have a large enough base of attendance (advertising impressions) to target specific audience groups as well as TV networks or online and mobile video advertising platforms. The increase in advertising impressions resulting from the merger will provide enough advertising impressions to enable us to create targeted buys across the nearly 80 age and gender demographic groups currently sold on a guaranteed basis by TV networks and to provide the psychographic and other more precise targeting provided by Internet and mobile advertising platforms.
Lower Costs for Advertisers
While demanding reach, ubiquity and targeting capability, advertisers also want advertising platforms that will make it less difficult to plan and execute their advertising strategies. Advertisers want a single network that provides consistency across all impressions purchased, makes it less difficult to compare performance with other media acquired for a specific campaign, and improves efficiency of media buying process (i.e., takes less time to execute). The merger creates the network that advertisers tell us they want to buy and eliminates the costs associated with the many differences between the NCM and Screenvision networks including differing proposal and rating point estimate processes, different pre show quality and format and ad placement, confusing messaging about reach and market coverage and the value of preshow placement, different pricing methodologies, different delivery technologies and different posting processes.
Significant Expense Synergies
As a result of the merger more than
As previously announced, the boards of directors of both
Forward Looking Statements
This press release contains various forward-looking statements that
reflect the current expectations or beliefs of the respective companies'
managements regarding future events, including statements about the
proposed merger. Investors are cautioned that reliance on these
forward-looking statements involves risks and uncertainties. Although
NCM believes that the assumptions used in the forward looking statements
are reasonable, any of these assumptions could prove to be inaccurate
and, as a result, actual results could differ materially from those
expressed or implied in the forward looking statements. The factors that
could cause actual results to differ materially from those expressed or
implied in the forward-looking statements are, among others, the outcome
of our defense of the merger with the DOJ and the combined company's
ability to timely and successfully integrate Screenvision's operations
into those of NCM and achieve the anticipated expense synergies and
increased revenue and earnings. NCM is currently unable to
forecast precisely the timing and/or magnitude of any such amounts or
events. Please refer to NCM's
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