MARKETING | MOVIE THEATERS
Are Movie Theaters Going the Way of the Abacus?
Netflix teed them up for the kill. Covid is swinging the bat.
I hate paying fifteen bucks for a tub of popcorn and a drink at the movies.
“But you get free refills.”
If I were to eat the entire (admittedly delicious) wheelbarrow-sized tub of buttered popcorn and go back for a refill, I might as well live directly in a pigsty. Also, I end up drinking the accompanying pony-keg-sized soft drink during the previews to the previews. Which perfectly times my first restroom run twenty minutes into the feature film.
I have calculated that each time I have to pee during a movie at the theater it costs me around thirty cents worth of viewing time.
Water Smuggling and Ticket Prices
To avoid the exorbitant drink prices, I have been known to smuggle a water bottle in my pants and make do with that. Never you mind where I stash it in my pants.
And, of course, none of the above even takes into account the ticket prices. The average single-ticket price before Covid-19 was $9.16. That’s right in line with an entire month of Netflix’s basic plan, which offers thousands of movies and television shows from the comfort of your own couch, which hopefully doesn’t have spilled popcorn and smashed Raisinettes on the floor in front of it. That calculation doesn’t count what the typical household pays for internet connectivity, but that is typically a sunk cost, anyway.
Now, multiply all that by however many people you go to the theater with. You need to borrow against your 401K just to visit the theater and eat snacks.
Another complication is that the big streaming platforms are creating ever-better original content. And lots of it.
All in all, that’s an uphill fight for theaters.
The Hammer Before the Final Fall
Enter Covid-19.
I drive past the main theater in our town every few days and, frankly, it’s a pitiful sight most of the week. The lights are on, but no one is home. Occasionally, tractor-trailers use the parking lot as an overnight place to stay. It looks like a picture of a movie theater where all signs of normal life were photoshopped out. I’m waiting to see tumbleweeds blowing through the parking lot.
With AMC being in danger of running out of cash in early 2021 and Regal shutting down all 536 U.S. theaters this past October, theater chains are under serious financial pressure.
Adding more fuel to the dumpster fire, movie studios are experimenting with streamed movie openings (Hello, “Mulan” on Disney+). How Disney rolled out Mulan is a story for another time, but the fact is that movies have successfully opened direct-to-streaming. Or successful enough, anyway. Universal’s “Troll World Tour” bypassed closed theaters in April and earned $100 million in the first three weeks.
If Covid continues to be the bane of human existence, movie studios will open more and more big-budget movies to non-theater audiences.
Movies are Loss Leaders
But given that theater owners think of movies as a loss leader, the days of theaters have to be all but numbered. It’s an expensive way to basically sell popcorn, candy, and drinks. Even though the chalk outline hasn’t been drawn around the body yet, theaters are dying in their present form.
Showing movies to essentially sell snacks at prices that piss most people off is no longer a sustainable long-term business concept when virtually every movie ever made can be streamed right to a consumer’s television.
Theaters and Culture
The big “but” to the bad news is that the movie theater, when it’s open, has an enormous screen and an awesome sound system. Great for the Avatar- and Star Wars-type films. Regardless, given all of the challenges I mentioned above, I really have to want to see a movie before I will show my face (and my wallet) in the theater. But when I go, I generally enjoy the experience.
I’m not a cinephile personally. Honestly, that sounds like an extremely naughty word. But movies are a deep part of our culture. And going to a movie theater is a big part of our culture as well.
Theater operators, just a quick appeal to you. Make the prices more affordable and make it up on the volume of new movie-goers you would attract. For cinephiles (there’s that word again), AMC Stubs and Regal’s Unlimited subscription seem like a step in the right direction.
I truly don’t want to see this historic section of culture wiped away. It will never have the power it once held. That is gone. But I would like to visit a comfortable, clean theater every once in a while, and really absorb a good movie with all my senses.
I’m hoping that movie theaters don’t go the way of the dodo bird, the abacus, and Blockbuster Video, but I’m convinced they will.
If Netflix and other streaming services kill them in a competitive marketplace, so be it. But please don’t let Covid do it.
I’ll contribute my part and go see Wonder Woman 1984 and Black Widow and other theater-worthy movies in my local cinema. I might even buy some popcorn to go with my smuggled water.
But movie theaters are treading water in choppy seas. Sharks and hurricanes are coming fast. And popcorn sales won’t save them.
