[K-Content Future] ⑦Making Films in Vietnam and Expanding Beyond Ho Chi Minh City and Hanoi

Jae Soo Ko, CEO of CGV Vietnam, on Turning Profitable
Focusing on Second- and Third-Tier Cities and Expanding Demand for Local Films
"Implementing Tailored Strategies... Closer Collaboration with CJ ENM"

CJ CGV operates 591 theaters (with 4,207 screens) across seven countries. Many of these locations are still suffering from the aftereffects of COVID-19. The recovery has been slow due to the rise of OTT platforms and price increases. The company posted a loss last year as well. However, the operating loss was reduced by 164.6 billion won compared to the previous year, thanks to strong performances in Southeast Asia. In particular, Vietnam led the improvement, generating 149.9 billion won in revenue and 10.2 billion won in operating profit. Although this is only a quarter of the domestic market, the growth rate is remarkable.

Jae Soo Ko CGV Vietnam CEO

This year also shows signs of being a bumper year. "Nha Ba Nu" (Nha Ba Nu·Family of Nu), which was released on January 22, set a new box office record in Vietnam. The film grossed approximately 430 billion VND, ranking among the top 10 global box office hits this year. The movie was planned, invested in, and produced by CJHK Entertainment, CJ's local subsidiary. CGV Vietnam worked closely to create a boom together. This year, the company plans to focus on second- and third-tier cities and expand demand for local films. Jae Soo Ko, CEO of CGV Vietnam, stated, "We plan to move beyond operating mainly in major cities like Ho Chi Minh City, Hanoi, Da Nang, and Hai Phong, and scale up our operations," adding, "We aim to increase the market share of second- and third-tier cities to around 35%."

-You managed to recover from the aftereffects of COVID-19 relatively quickly. What was the secret?

"Despite suspending operations, we focused on strengthening our brand image and communicating with customers, which proved effective. We relied more on our own social media channels than on on-site promotions. We produced and distributed a variety of lifestyle content that local people would enjoy, even if it wasn't directly related to movies. Currently, we have 4.2 million Facebook subscribers, 670,000 on YouTube, and 200,000 on Instagram. This is the highest not only among local theaters but also across the entire entertainment sector in the region."

-There are significant differences between first-tier cities like Ho Chi Minh City and Hanoi and second- and third-tier cities in Vietnam. It seems a differentiated strategy is needed.

"Everything is different, from consumption patterns to lifestyle habits. To settle in quickly, we produce weekly movie booklets and distribute them intensively in markets and schools. Considering that many are not used to subtitles, we pay close attention to dubbing. We also adjust screening times based on local lifestyles to foster a moviegoing culture. We have already created an environment that attracts customers. Rather than operating as 'stand-alone' buildings, our theaters are concentrated in prime locations such as popular global and local brand malls with heavy foot traffic. We plan to focus on strengthening our core business and improving our cost structure, rather than expanding further, while also boosting high-profit operations."

Movie 'Nya Ba Nu' Still Cut

-Preferences for movies differ by region in Vietnam. Customized programming seems crucial for balanced growth.

"That's right. Last year, the market share of local films in Hanoi and Ho Chi Minh City exceeded 65%. These are major cities, but the key to maximizing profits was supplying films that matched demand. For example, local films are popular in Ho Chi Minh City, while Hollywood blockbusters are preferred in Hanoi. Korean films perform well regardless of region. We plan to further develop tailored strategies for second- and third-tier cities as well."

-In Indonesia, live concerts by K-pop groups or musicals are very popular. What is the situation in Vietnam?

"By law, screening or hosting non-film content is restricted. We are meeting with government officials to request revisions and easing of these regulations. If these issues are resolved, we expect to provide a broader range of experiences and expand the local cultural content market."

-The most successful Korean film in Vietnam last year was "Yuksao." What do you think made it resonate?

"Vietnamese audiences love stories about family love and affection. When these themes are combined with genres like melodrama or comedy and delivered in an accessible way, interest skyrockets. 'Yuksao' was successful for similar reasons. The story of bonds between siblings, lovers, and North and South Korean soldiers, mixed with comedy, brought both laughter and emotion. Careful translation also played a significant role in its success. By incorporating popular slang used by local youth, we generated positive word-of-mouth. As a result, the film attracted 2.25 million viewers in Vietnam, surpassing the 1.97 million in Korea. Even '2037,' which only drew 7,257 viewers in Korea, attracted 330,000 in Vietnam. Its story of a girl dreaming of happiness with her mother despite a desperate situation touched the hearts of the audience."

Movie Poster for "Yuksao"

-You are also directly producing local films based on your understanding of audience preferences.

"Vietnam lacks major corporations leading the cultural industry. The film production environment is still underdeveloped. The number of annual releases has stagnated at around 40 for several years. Growth is so slow that direct involvement is necessary. We are collaborating with CJ ENM in various areas, including planning, production, investment, and distribution. As platform boundaries blur, closer cooperation is needed to secure global competitiveness beyond Vietnam."

-The growth of local films is also crucial for expanding the age range of moviegoers. It could be the key to attracting middle-aged and older audiences.

"I believe Vietnam is no different. For example, during the height of the COVID-19 pandemic in 2021, the local film 'Bo Gia' (Dad, I'm Sorry) attracted 4.9 million viewers. The story about fatherly love drew large numbers of middle-aged and elderly moviegoers. This was more than double the previous all-time box office record in Vietnam. If more films of a similar nature are produced, the age distribution of audiences could become more balanced."

-It seems you are putting a lot of effort into discovering related IP.

"Absolutely. Rather than simply soliciting scripts, we focus on nurturing creators. We are also running a short film production support project with the CJ Cultural Foundation. The growth and diversity of aspiring filmmakers are the driving forces behind new market expansion."

This content was produced with the assistance of AI translation services.