Online service Tugg aims to match audiences with films and address the issue of low cinema occupancy. Jeremy Kay speaks to co-heads Nicolas Gonda and Pablo Gonzalez.

Walking among the executives from monolithic theatre chains in the corridors of Caesars Palace at CinemaCon will be Nicolas Gonda and Pablo Gonzalez. The co-heads of the highly influential Tugg have won many friends on the circuit since they launched the theatrical-on-demand service at SXSW 2012.

A little over a year since its arrival, Tugg is buzzing along nicely. Gonda, the former Focus Features publicity, marketing and distribution executive and regular Terrence Malick producer, and Gonzalez, whose background is in development and marketing, have built the start-up from humble roots in Austin, Texas, into a globally renowned, plugged-in social mechanism that addresses the alarmingly low occupancy rates of theatres and matches audiences with distributors and film-makers.

“All the theatres we work with, from the major chains to the indies, are all faced with finding ways to engage with their local communities,” says CEO Gonda. “Our presence at [events like] CinemaCon or Art House Convergence is to continue to advance that service and learn from their needs and wants.”

Gonda has gone on record before as saying that Tugg was born out of a question — namely how to improve the system. “I see and continue to see incredible artists always wanting to create [content] and a fanbase that is always wanting to experience [that content],” he says. “There’s sometimes a disconnect, whether it’s a small town that doesn’t get that film or an audience that wants to get a movie back into their theatres. Until now there’s not been an efficient mechanism to allow passionate audiences to do something about it.”

Visitors to choose a film — the company’s licensing deals have so far enabled it to build a 1,100-strong library — and decide where and when they want it to screen. They promote the event through email and social media.

Tugg books the event, determines the ticket sale threshold and takes a percentage of sales. If the promoter does not sell enough tickets the screening is called off and nobody loses a penny.

Major chains like AMC, Cinemark, Goodrich and Rave were quick to sign on to Tugg, as were independent exhibitors like Alamo Drafthouse. Successes include screenings of Craigslist Joe, ReGENERATION and Iron Sky, which over the past eight months has screened to packed houses at dozens of events across the US.

Recent screenings encompass Abbas Kiarostami’s Cannes 2012 premiere Like Someone In Love [pictured], presented by the South Bay Film Society in California, and the war veterans documentary Honor Flight, presented by the Twilight Brigade NOVA in Virginia.

Library titles include 127 Hours, Dr Strangelove, Elf, Bully, Food Inc and It’s All Gone Pete Tong.

Tugg COO Gonzalez notes average attendance per event hovers around the 110 mark, while average ticket prices are $10-$11. A recent Iron Sky screening in Seattle sold out 433 seats. Tugg events are theatrical, of course, so are grosses part of the overall figure reported to Rentrak? “We leave it up to the distributor and the film-maker,” says Gonda.

Tugg’s allure goes beyond repertory theatre. Gonzalez says the industry is now using it to build brands. “We get calls from the marketing arms of studios who are releasing a repertory film and want a marketing push in the way Tugg can provide it,” he says. “Or they may want a Tugg supplement to a day-and-date release, with the understanding that community building is such a crucial part of their strategy.”

Last autumn, Tugg was brought in by Lionsgate/Summit to build buzz on Sinister in a week-long series of advance screenings ahead of the official release last October. The horror film went on to gross $48m in North America. “One word-of-mouth recommendation has an impact on an individual equivalent to more than 200 TV ads,” claims Gonda.

The world is watching. Inevitably, the notion of international expansion has come up in conversation. “We are definitely interested,” says Gonda. “We are seeing a lot of need and demand from both content and promotional partners overseas. However, we are most excited right now about continuing enhancement on the site, taking into account what we have learned in the first year. We continue to be a company that strives to be as self-reflective as possible.”

Nicolas Gonda, Tugg CEO

Gonda previously worked in publicity, marketing and distribution at Focus Features and produces Terrence Malick films, including To The Wonder.

Pablo Gonzalez, Tugg COO

Gonzalez was born in Montevideo, Uruguay, and for more than 11 years led development and marketing teams in an array of industries, ranging from enterprise software to retail products.