Inland Northwest Cinemedia allows local advertisers to buy their own little slice of the big screen, complete with a local audience to watch their pitches.

"Nobody ever says, 'I don't want my ad to be in the movies,'" says co-owner Mary Beth Murphy.

Murphy and her husband, Kelly, bought the company last year, and he has been running the day-to-day operations since last October. Kelly Murphy says the venture allows him to keep both feet on the ground after an 18-plus year career of crisscrossing the country by plane as a national account manager for biotechnology giant Amgen Inc., which has its corporate headquarters in Thousand Oaks, Calif.

"I like the freedom," Murphy says. He says he used to be always in flight, in an airport, or on a conference call. Now, he works out of an office at his home and says, "Even in a worst case scenario, wherever I am I can get in my car and drive home."

Cinemedia sells advertising time on independent movie screens before the beginning of movies. The advertisements are professionally produced stills, animations, or videos, complete with sound, and typically 15 seconds long. Each advertisement is guaranteed to be shown at least three times among a rotation of about 20 ads, seven days a week before each movie on each screen in the movie theater where the ad plays. The Murphys say that means most ads are shown about 6,000 times a month and are seen by more than 45,000 moviegoers in a theater such as the Village Centre Cinemas at Wandermere Mall here, which has 14 screens.

The ads currently are shown at seven theatres in the Northwest, including Village Centre here, along with theaters in Pullman, Pasco, Moses Lake, Wenatchee, Port Angeles, and in Lewiston, Idaho.

The Murphys, who bought the three-year-old business through a company they formed here called K & M Cinemedia Inc., say they're pleased with their first-year results. They've increased Cinemedia's revenues to about $325,000 for 2008, from $250,000 in the previous year, and they now have about 100 clients whose ads are being shown in any one of those seven independent movie theaters in Washington and Idaho, Kelly Murphy says. He says he anticipates sales growth of up to 30 percent over the next 18 months.

Advertisers buy time on a monthly or annual basis, for what amounts to about 10 cents a showing for most ads, Murphy says. About 60 percent of the company's clients have annual contracts, he says. In addition to the paid advertising, Cinemedia also runs spots to highlight theater guidelines, and donates time for public service announcements.

Up to 20 ads are shown in rotation at each movie theater complex, using a computer server that Cinemedia installs. The server is connected to individual digital projectors that are installed next to the large film projectors. The digital projector shuts off automatically when the movie projector next to it starts, Murphy says. Software on the server continues running after the movie starts and continually provides a video signal to the other projectors for when they need it.

Inland Northwest Cinemedia owns and maintains all the equipment used to show its advertising, and pays the theaters at which it shows advertising a percentage of the revenue generated by ad sales for that theater. Murphy says each digital projector costs about $2,500, but as movie theaters switch from film projectors to a digital format, the advertisements could be shown on the theaters' digital projectors, reducing the amount of equipment Cinemedia would have to provide.

The company's clients either produce their advertisements themselves or Cinemedia refers them to ILF Media Production LLC, a production company here, to have ads created. The cost to have the ads created ranges from $300 to about $700, depending on how complicated they are, Mary Beth Murphy says. Cinemedia charges its clients a one-time fee to insert each ad into the rotation at a theater, she says. Some clients change their ads monthly or for holidays.

Mary Beth and Kelly are the company's only employees, but they also use an independent contractor to sell ads in the Tri-Cities area.

Cinemedia's clients find the advertising to be quite effective, Mary Beth Murphy asserts. She says one restaurateur offered a 20 percent discount to patrons who mentioned the movie theater advertisement, but was so overwhelmed by the huge response he asked Cinemedia to pull the discount offer from the advertisement after just two weeks.

In addition to the positive customer response advertisers receive, they remark that they are thrilled to be "famous," Murphy says. As an added benefit, the company offers 24 free movie passes to clients who sign up for a year-long contract.

A change in flight plan
Before the Murphys bought the venture in August 2007 from Jerri O'Reilly, the company was operated as Inland Northwest Cinemedia Inc. O'Reilly had been running the business as a part-time endeavor, and was a client of Mary Beth's yoga and personal training studio.

Meanwhile, Kelly Murphy had wanted for some time to change careers, as he had tired of the frenetic pace of traveling city to city. He says he'd often be on a flight to Los Angeles on a Monday morning or on a flight home from Dallas on a Thursday evening, scanning newspapers for businesses for sale.

When O'Reilly confided to Mary Beth that she wanted to sell her business, Mary Beth says something clicked. She says her husband reviewed the company's books and decided it was a niche he thought he could make work.

"He gave his notice, and we're small-business people now," Mary Beth says.

Kelly says they've spent the past year establishing their presence as the new owners, and seeking to increase revenue while avoiding growing too quickly to be manageable.

Mary Beth recently closed her studio and began working full time at Cinemedia as vice president of sales and marketing, though she still does personal training and teaches some Pilates classes at a small North Side gym.

Kelly Murphy says he hopes one day that one or both of the couple's two daughters will get involved in the business. Their oldest, Lauren, is a freshman at the University of Montana, in Missoula. He says he brimmed with pride when she asked him a business-related question for a class she was taking. Their younger daughter, Jocelyn, is a sophomore at Gonzaga Preparatory School here.

Murphy says that though it's been positive overall, there are some trade-offs to owning a small business.

"It's always 11 p.m. at night when a bulb goes out" on one of the digital projectors, he quips, adding that the benefit of always being within driving distance of home makes the few late-night calls worth it.

Most equipment issues are minor, and the theater staff members will move any projector that doesn't work to a screen that has a small audience at that time until it can be repaired, Murphy says. Since they've owned it, the company has never been off-line during a big premier, such as the recent opening of "Twilight," he says.


The best bang for the buck
The big chain theaters do similar advertising before shows, but Murphy asserts that the cost for ads for those theatres is far more than a small company typically would be able to pay. Some small independent theaters, like Spokane's Garland Theater, sell a similar self-produced service themselves. Most of Cinemedia's clients have budgets somewhere in between those two ends of the spectrum, he says.

Mary Beth says there has been some reticence on the part of advertisers to buy cinema ads in the slow economy, but for the most part, the company's customers feel they get a lot of bang for their advertising buck.

She says captive-audience advertising that can't be turned off, paged through, or moused over is hard to find. In addition, people are primed for a positive experience when they go to a movie theater, which helps Cinemedia's customers brand themselves favorably, she says.

Murphy says he thinks the business will continue to grow, as movie theaters appear to do well in down times.

"Every one of my theaters is building additional theaters or adding screens," he says.

If all the theaters carry out their expansion plans, including one that is planning to build a new theater in Moscow, Idaho, Murphy says, the number of screens Cinemedia advertisements will be shown on will increase to 95 from the current 65 screens across its markets now.