Hans Gunadi: Driving The Transformation Of The Indonesian Cinema Industry

Hans Gunadi: Driving The Transformation Of The Indonesian Cinema Industry

Hans Gunadi , President & CEO

Hans Gunadi

President & CEO

As the leader of Indonesia's largest cinema chain operator, Hans Gunadi, President & CEO of Cinema XXI, leads a significant role that is inseparable from contributing to the flourishing national film industry. With nearly 30 years of professional experience, Gunadi has been instrumental in bringing about positive changes and elevating the cinematic landscape and experience for audiences in the country. Hans received his Bachelor's degree in Civil Engineering from Parahyangan Catholic University and a Master's degree in Project Management from The University of Manchester. His leadership style has been described as collaborative and visionary, with a focus on innovation and growth. In this exclusive interaction, we have spoken about his journey toward success, let’s dive into it.

Could you share a bit about your professional journey and what drives you each day?

With over 12 years of experience in Indonesia's cinema industry, I started as the President & CEO of Cinema XXI, the country's largest cinema chain operator. Beyond that, I'm also the President Commissioner of PT Nusantara Elang Sejahtera, which manages TIX.ID, Indonesia's largest ticket aggregator platform. Prior to this, I spent almost 15 years in the financial sector before being asked to apply my expertise in transforming Cinema XXI into an international standard company by its founding family.

I believe that success comes from a united team effort rather than individual heroics. Over the past three decades, our organization's strong sense of belonging and teamwork has been critical in overcoming numerous challenges. Knowing this motivates me to strive to be a better leader every day by prioritizing the team's welfare, improving our organization, and enhancing our services to the public. It takes a great deal of effort to provide top-notch entertainment to the public, and I'm proud to lead a team that delivers just that.

With more than twenty years of experience, can you describe your journey to achieving success and what is your key to success?

Success cannot be achieved overnight. As I mentioned earlier, the success of our company today is not solely due to my efforts. I always stress to the entire team at Cinema XXI that every role is equally important. Every individual and department contributes to the company's success by utilizing their unique strengths. Similar to a car, no matter how excellent the engine or driver is, if there is a malfunctioning part, the car will not run smoothly.

We have always been at the forefront of technological innovation & believe that technology plays a major role in creating a seamless experience for movie-goers

Can you describe Cinema XXI's organization and its position in the market? What sets your organization apart from others, and what facilities do you plan to introduce to enhance the movie-watching experience for your audience?

Cinema XXI is Indonesia's largest cinema chain operator, with 225 cinemas and 1,216 screens across 55 cities by the end of 2022. Around 67 percent of our screens are located in tier 1 cities, and we are expanding our presence in tier 2 and tier 3 cities to promote the growth of movie-going culture in Indonesia, along with support for domestic movies and filmmakers. Our vision is to be the best cinema chain in the world and the pride of Indonesia, and we strive to achieve this by providing uncompromised quality and affordable entertainment while constantly serving forever better products and services for movie-goers.

Since opening our first modern cineplex in 1987, we have continuously innovated to provide a diverse range of offerings that cater to the heterogeneous preferences and behaviors of Indonesian movie-goers. We offer theater formats with tiered pricing, such as Deluxe, The Premiere, and IMAX, and we take a hyperlocal approach to adjust movie choices and ticket prices based on local disposable income. We complement our extensive range of domestic and international content with high-quality, and innovative F&B menus whose channel has expanded from only concessions and restaurants to online marketplaces.

Hans Gunadi ,President & CEOWe have always been at the forefront of technological innovation and believe that technology plays a major role in creating a seamless experience for movie-goers. We launched m.tix, the first SMS-based movie ticket reservation system in Indonesia, in 2006, which has since evolved into the first widely-used mobile ticketing app. We use this app to accompany movie-goers throughout their entire movie-going journey and beyond, providing personalized push notifications, seamless digital ticketing and F&B purchasing experiences, exceptional entertainment experiences in our theaters, and data-driven movie recommendations and loyalty program rewards to encourage recurring admissions.

Our constant innovations and consistent delivery of high-quality products and services have made us the most recognized cinema brand by 97 percent of movie-goers in Indonesia, achieving 97 percent satisfaction level for sound and visual quality, 95 percent for comfort, and 82 percent for F&B options— based on our survey conducted with Euromonitor. We maintain our position as a household brand by running highly efficient operations and managing a prudent balance sheet. This culture has helped us weather many challenges over the past three decades, including the COVID-19 pandemic, and we expect to return to pre-COVID performance.

Can you describe your leadership and governance style and the principles that guide your actions as a leader?

The way I lead the organization is heavily influenced by the founder of Cinema XXI, who was also my parent. Their leadership style is not only motivated by a clear vision, but also by a deep love for the industry, the company, and all its employees. We are encouraged to work with passion, and like our parents, we stress the importance of building strong teams, especially when dealing with challenges and difficult situations. As the second generation, it is both an honor and a significant responsibility to continue the legacy of Cinema XXI and take it to new heights.

Going forward, what are the changes in market behavior that you anticipate and what are the opportunities that you foresee?

We are anticipating the growth of GDP per capita in Indonesia to positively boost customers' dispos­able income, and thus, our industry. Based on our observation, once a country's GDP per capita reaches the range of $5,000-$10,000, the disposable income will increase as well and there are three industries that will reap the most benefit: food, travel, and en­tertainment—two of which we focus on. It also pos­itively affected the cinema industry of emerging countries that we observed: Russia’s total screens soared from 1,800 in 2009 to 5,700 today, Brazil’s from 2,000 to 3,500, and Mexico’s from 4,000 to 7,500.

"It's essential to keep in mind that there is no ‘superman’, only a ‘super team’"

Meanwhile, according to Statistics Indonesia, In­donesia's GDP per capita passed $4,700 in 2022. Through various data that we have gathered, we see that Indonesia is displaying similar characteristics. Consumer spending behavior in Indonesia has be­gun to change since 2016, and this is also reflected in our F&B sales, which recorded nearly double the increase in percentage in the past five years (from 2016 to 2022, excluding 2 years of the pandemic 2020-2021). We hope that once Indonesia’s GDP per capita reaches the said threshold, Indonesia too will benefit from this cycle in the next couple of years.

As an experienced industry professional, what guidance would you offer to emerging leaders in the field?

My advice is to cultivate a culture of innovation and teamwork within the organization. These qualities are crucial in overcoming obstacles and fostering morale. It's important to remember that success is not solely the responsibility of a leader or upper management; everyone in the company should share credit for the success since each individual plays a unique role. Finally, it's essential to keep in mind that there is no ‘Superman’, only a ‘super team’.

What measures have you implemented to ensure the welfare of your employees?

We consider the relationship between the organiza­tion and employees to be mutual, so we have imple­mented three human capital policies: talent man­agement, training and development, and incentives and compensation. The talent management policy aims to adapt and change our recruitment and tal­ent management strategies to align with millenni­als' perspectives and needs. We aim to enable em­ployees to grow with us instead of merely working for us. In terms of training and development, we of­fer programs that encourage employees to improve themselves, such as managerial development and knowledge exchange programs. Regarding incen­tives and compensation, we provide the best com­pensation and benefits schemes, including promo­tion packages, health insurance, employee welfare, competitive incentives, and annual bonus schemes.

Can you discuss some of the toughest challenges you have faced during your journey, how you overcame them, and what you learned from them?

The COVID-19 pandemic was the biggest crisis we faced in our company's history, forcing us to shut down operations for almost ten months. Throughout that dire situation, everyone was willing to share the burden. We have a super team who was down to fight the crisis together and tirelessly figured out ways to keep the company running, along with the lives of over five thousand employees who depended on us. As a result, we survived the pandemic with EBITDA positive and without anyone being laid off. We also found a silver lining in that it forced us to improve and innovate our existing offerings, such as selling our F&B products on food delivery platforms. This led to the launch of an online F&B service within our existing mobile ticketing application, m.tix. We learned that as long as we trust each other and work together, we can overcome any challenges.

Tell us about your plans ahead

Our long-term goal is to grow with the national film ecosystem and be there when the industry reaches its peak potential. Indonesia's domestic film contribution to the national gross box office, currently at 40 percent to 50 percent, is the fifth largest in the world, and this has led to increased investment in domestic content, and thus, viewership.

Our other long-term goal is expansion. Currently, Indonesia is a significantly under-screened market with only 0.8 screens per 100k population. We see a huge opportunity to fill this gap by penetrating the second and third-tier cities in Indonesia. Their number of admissions per screen is nearly as high as that of first-tier cities, coupled with promising growth of disposable income.

So, the room for growth is huge, and it strengthens our motivation to expand to these cities.

Hans Gunadi, President & CEO, Cinema XXI

Hans Gunadi is a seasoned business executive from Jakarta, Indonesia, currently serving as the President & CEO of Cinema XXI. With over 12 years of experience in this position, he has led the company through significant growth and expansion. Along with his role at Cinema XXI, he is also a co-founder of TIX ID. Prior to his work in the entertainment industry, Hans held various positions in the financial sector. He worked as a Vice President at Citi in Singapore from 2008 to 2010 and held the same position at Salomon Smith Barney Holdings from 1999 to 2007.

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