New opportunities

Despite China's huge movie market, many experts believe that the domestic film industry has not yet developed a fully mature business model. They said profits should not only come from ticket sales, but also from related sectors, such as merchandising, to maximize revenue and create a sustainable model.

Chen said a probable positive signal for change in the industry was that The Wandering Earth II set a record in its merchandising fundraising, a regular market strategy which sells yet-to-be-produced products to reduce the risk of uncertainty.

For instance, if a film is not popular or the design of the products is not appealing, this strategy can help mitigate potential losses.

The Wandering Earth II started its fundraising presale on Jan 22 with a goal of 100,000 yuan. However, the response from enthusiastic fans was overwhelming, and the presale surpassed 100 million yuan within one week, generating the highest revenue for a Chinese movie's merchandise in history.

Moreover, due to the high demand, the companies making the merchandise had to stop the presale, as they had already reached their annual production capacities.

Deemed a breakthrough in film merchandise, which typically consists of small, low-cost items such as keychains, stickers and stuffed toys, the sci-fi blockbuster's best presold item was a replica of a dog-shaped robot that features in the movie. The robot has more than 1,800 parts and is controlled by a smartphone app.

In addition to The Wandering Earth II, the merchandise of other popular movies such as Boonie Bears: Guardian Code and Deep Sea has also sold well, indicating the huge potential of the once-niche market.

Zhi, from the Chinese National Academy of Arts, said the merchandise sales for Spring Festival blockbusters this year far exceeded expectations, but also showed that the domestic merchandise business is still in the primary phase.

Noting that Hollywood relies on long-running franchises such as Star Wars to earn more profits than box-office revenue from merchandise and create an enduring influence among fans, Zhi said Chinese filmmakers should plan ahead and start designing merchandise when a movie project is launched.

"With a greater range of cultural products associated with a movie franchise, the development of intellectual property will become more sustainable, resulting in a more mature industry," she said.

Two years ago, China unveiled a 14th Five-Year Plan (2021-25) for the domestic film sector, with the aim of becoming a major force in the global movie industry and deepening the impact of Chinese films on the global cinema landscape.

With the recovery of international tourism, those efforts are being revived. At the recent 73rd Berlin International Film Festival, 15 Chinese films were nominated in various categories, including two titles — the animated feature Art College 1984 and The Shadowless Tower, based in Beijing — that were nominated in the main competition category.

As a successful example of Chinese movies going abroad, The Wandering Earth II has been released in many countries, including the US, the United Kingdom and New Zealand, and is scheduled to reach more overseas markets, such as Russia and South Africa.

Speaking about the resurgence of Chinese movies on the international stage, Huo said it is inspiring to see both commercial blockbusters and art house films gaining attention overseas, indicating a significant leap forward in Chinese cinema's decadeslong efforts to expand abroad.

Emphasizing the importance of China's goal to become a strong film power by 2035, Huangfu said that it will require an increase in the number of annual productions and the quality of domestic movies, which will necessitate various improvements, including the cultivation of more talent and the development of cinematic technology.

He said Chinese filmmakers should root their creations in real life and portray the authentic emotions of the Chinese people, thus gaining empathy from the majority of audiences and forming a sustainable, healthy film ecosystem.

Knowles, the US actor, said: "The film industry has always been like surfing in the ocean. Sometimes you catch a big wave and sometimes you are waiting for the next one to come in … what China is offering now is bigger and bigger waves, so you had better be ready."