Economics of movie theaters

Quote: FrGamble

Apparently he made more in concessions than ticket sales.

Ticket sales are turned over almost whole to the studio or the distributor.

I wonder back when X-rated films got shown in theaters, whether ticket sales at multiplex theaters for "family" films were higher than average, in particular among teens.

$8 for a small bag of popcorn the other night. I can believe it.

Quote: Pacomartin

Maybe ultra long term, but they don't build them and tear them down very quickly.

Yes, talking decades. Sometimes they buy more land than they need and sell the surrounding off as well. Seen it happen.

Quote:

Demographics movie tickets sold relative to percentage of population
-11% Caucasian
-8% African American
+38% Latin
+29% Other

Whoa! Never seen this before. Must wonder about the "other." Must be some Asians in there as just seems they have a cinema tradition culturally. For white to be less than 1/5 of what an even distribution would be is amazing. To me it is a mix of whites have nicer stuff at home, whites are older and see less movies, and whites are tired of the nonsense a the theater.

I also wonder if it isn't part geographic, more Latins in CA so skews things?

Quote:

But I just can't get over that 59 patrons on average per screen day. You have to figure that given 6 showings in a typical theater, there must be 500-600 available seats in a day.

I believe it easily. A few times I have been 1 of less than 10 in a showing. I did an audit one weekend and one showing had 0 people, none had more than 20 or so. The same theater in the 1980s and 1990s paid two guys to shoo traffic to the outer lots and one to just stand and direct people to the right show.

It will not change, Hollywood model suits studios fine, they will not notice until it is too late. I do not care, I at most see a flick every 18 months or so.

Quote: AZDuffman

I do not care, I at most see a flick every 18 months or so.

A surprisingly large group of people go to the movies at least one time per year. Hard statistics: More than two-thirds of the U.S./Canada population (68%) – or 225 million people – went to the movies at least once in 2012, consistent with prior years. But 9% of the population saw EXACTLY one movie in 2012. A total of 32% of the population over age 2 saw ZERO movies in 2012.

Quote: AZDuffman

Whoa! Never seen this before. Must wonder about the "other." Must be some Asians in there as just seems they have a cinema tradition culturally.
I also wonder if it isn't part geographic, more Latins in CA so skews things?

It is that 13% of the population that sees at least one move per month, that buys 57% of the total tickets. California, Texas and Illinois are the highest per capita movie going states of the large states. Latinos and Asians go more frequently than most.

Partly it is an age thing. Caucasians tend to be older than Latinos. Perhaps if they systematically did a comparison by age groups there would be no difference between Caucasians, Latinos and Asians.

Quote: AZDuffman

I believe it easily. A few times I have been 1 of less than 10 in a showing. I did an audit one weekend and one showing had 0 people, none had more than 20 or so.

Still you wonder what would be the purpose in building so many screens given that they knew the number of theater goers has been stagnant for decades.

2014 1,268.2 million tickets sold
1989 1,262.8 million tickets sold: Batman was #1 movie

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From my initial post
Average attendance is 59.1 patrons per screen day (multiple showings). Admission is $7.23 per person of which $4.01 is Film exhibition costs (leaving $3.22 for the theater owner) and average is $4.55 per person in concessions.

Quote: FrGamble

I heard a good line from someone who owns a movie theatre in Indiana. He said, "the key is to find a place where people like popcorn and build your theater there." Apparently he made more in concessions than ticket sales.

It isn't a question of making a little extra profit like showing the commercials at the beginning. Without the concession sales there is no business. They would close their doors. Carmike closed their box office, and you know must go to the concession stand to purchase tickets.

The long haul real estate game does seem like the only possible explanation.

Quote: Pacomartin

It is that 13% of the population that sees at least one move per month, that buys 57% of the total tickets. California, Texas and Illinois are the highest per capita movie going states of the large states. Latinos and Asians go more frequently than most.

Partly it is an age thing. Caucasians tend to be older than Latinos. Perhaps if they systematically did a comparison by age groups there would be no difference between Caucasians, Latinos and Asians.

It seems movies need to be marketed like baseball. The rule of thumb for baseball is if you get everyone who goes once to go twice you triple paid attendance. Baseball teams thus put in an effort to get you to buy two tickets. If I were a theater owner I would push blocks of tickets for two dates with the second half off. IOW, you can't use the half-price one to bring your date.

This would require studios to accept a lower payout on some tickets. But it might be the answer.

Back to the Latinos, it may also be regional? Latinos have a huge concentration in CA and the southwest. Do more people go to movies there?

Quote:

It isn't a question of making a little extra profit like showing the commercials at the beginning. Without the concession sales there is no business. They would close their doors. Carmike closed their box office, and you know must go to the concession stand to purchase tickets.

The long haul real estate game does seem like the only possible explanation.

When I did the audit, the manager was there, and I am not kidding, 20 years ago when I serviced the place in the 1990s almost 20 years prior. He had seen the fall. His place lost a lot of customers to newer places that cut off customers from the eastern suburbs of the city. But it was more than overbuilding. He thought they had pushed too far with the concession prices.

Popcorn and soft drinks are big enough for several people. I might pay $3 for a small drink but no way I am paying $6 for one 4Xs what I can drink, and at that size I care not about free refills. Popcorn same way. Now, some places are marketing to repeat customers with a $20 or whatever one-year refill deal. Maybe it helps.

But I will go back to a conversation I had this week, and have had before. For many people, it is just annoying to go out for what is as good at home. Maybe it is being older. Maybe it is a MAWG thing. But had the conversation about sports, and a few of us said we do not care to go to an NFL game again, ever. Same reasons. Cost of admission and in sports case parking. High food costs. Too much rowdy behavior. Why go out and do that?

Seems as if innovation is not going to be rewarded, hire two dolts as popcorn sellers and thats it.

Perhaps even some theaters are restricted by anchor tenant leases from innovating.

Its similar to those storage units. People bought the land and put storage units on it to pay the taxes while development took place. Now its taken place but there is no real incentive to get out of the business because the loacations are not valuable. So limp along with some dumb manager and wait a few more decades is the only sensible thing to do.

Well, judging from Carmike, the 4th largest circuit, it looks like they are just barely holding on by the skin of their teeth. And Jurassic World was a far bigger hit than anyone predicted,


Net (loss) income Carmike Theaters
$ (6,257): 3rd quarter 2015
$ (1,445): 2nd quarter 2015
$ 391: 1st quarter 2015
$ (8,942): annual 2014
$ 5,753 :annual 2013
$ 96,308 :annual 2012
$ (7,710) :annual 2011

Carmike Cinemas, Inc. is a U.S. leader in digital cinema and 3D cinema deployments and is one of the nation's largest motion picture exhibitors. As of June 30, 2015, Carmike had 270 theaters and 2,881 screens in 41 states. All of our theatres are equipped to provide digital cinema and 257 theatres and 1,079 screens are equipped with 3-D capability. Carmike's focus for its theater locations is mid-sized communities.

Quote: Pacomartin

Carmike closed their box office, and you know must go to the concession stand to purchase tickets.

That is brilliant!!!

Quote: DRich

That is brilliant!!!

I know! Instead of trying to increase revenue by selling tickets to movie screen versions of operas, they are selling us $5 boxes of candies that are making us look like opera singers (but without the talent).

I did buy a box of candy for SPECTRE, which I don't normally do. My movie ticket was $5.75 and the candy was $4.75 .

Quote: Evenbob

I'm amazed people still go to movies.
Last time I went was 2011. People
coughing and talking, having to breath
the air that 100 other people have just
exhaled. If I never go again it would be
fine with me.

Ain't for me, either. I had to look it up; I haven't been since '03. Haven't missed it either. Was just talking to my best friend about this. We both buy media years after it comes out. Typically 3 years for games and such. It's the same product, but at 20% of the cost and hassle. All you miss is being "in" at the water cooler, and who cares about that?

That being said, I see there's a Moby Dick spinoff out now. Might take the kids to see it. I'll report back if I do