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'Lipstick effect' - People will still spend on the movies

THOUGH times are tough, people still want to go to the movies to lift their spirits.

Compared with manufacturing and other sectors, the financial crisis so far has not hurt local theaters and film distributors.

As China's cinema industry continues to expand, this group of people is still working to a tight schedule, the envy of some unemployed workers.

However, due to the decline in some people's entertainment budgets, the industry needs to work "smarter" to attract a bigger audience.

Over the past months, 40-something Gu Min, a veteran film marketing and distribution manager from a major cinema chain, has spent a lot of time analyzing trends in world cinema, trying to adjust his schedule to the changes.

"The effect of the current global economic downturn on local film distribution is not that fast and obvious," Gu says. "Movie theaters in the city do a booming business. But that doesn't mean that the film industry will not be affected in the following one to two years."

Some worried film investors may decrease their investment these days and require strict controls of the shooting budget, he says.

"This is bad news to many film makers, but on the other hand, it is a good thing for moviegoers as a higher premium will be placed on the quality of film rather than the quantity," Gu explains.

He says many actors now work for lower pay, making it possible for a film to attract an audience with its star-studded cast, instead of expensive animation or stunts.

Making sequels to popular films will be another trend in the economic downturn. With a large established fan base, a sequel doesn't require big promotional expenses. And experienced film crews make the shooting faster and more efficient.

There is little doubt that another sequel, Hollywood blockbuster "Transformers 2: Revenge of the Fallen" will top the local box office when it's released in China on June 24.

"This reflects the 'lipstick effect' theory, meaning that in hard times consumers are more willing to buy less costly goods, such as lipstick," Gu says.

"Watching a film is certainly less costly entertainment," he says. "I am optimistic the movie industry can survive the financial crisis."

Additionally, Gu will be watching the box office for big-budgeted domestic films such as Teddy Chan's action epic "Bodyguard and Assassins" and Gao Qunshu's spy thriller "The Message." They are expected to be released late this year or early next year.

"The public response to these movies will be give important information to investors and producers," Gu says. "It will also signify the future changes, development and opportunities of Chinese cinema."


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