Friday, November 26, 2010

Dine In Movie Theaters - An interesting business model

There are some things that are universally loved by teenagers. Pizza, Ice Cream, A day without homework, and Movies. When my favorite movie theater closed for renovations several months back, I was extremely disappointed, especially since it would mean a summer of either not going to a theater, or finding a less preferable, further distant venue.

I knew they were renovating, but had no idea what was their intended outcome.

The theater that used to be my favorite has left me with something so much greater, but with a little disappointment as well. My theater is now an upscale dinner-movie experience. We were given a wonderful opportunity to see an "older movie" in a free screening to introduce people to this new concept. By "older movie" they meant movies that were no longer in the theaters, but not yet on DVD. I was not disappointed, because we chose "Inception", which I really enjoyed, just as much as the new dining format as well !

Here is a brief comparison to the "old style" theater and the "new" Dinner-movie experience.


Old: Popcorn, Big Candy Boxes, maybe hot dogs and nachos

New: FULL meal experience - Appetizers, Entrees, DESSERTS all delivered right to your seats.


Old: Sodas, Icee Frozen Beverages, Bottled Water

New: Sodas, Bottled Water, Full Bar including Wine, Beer, Top Shelf Mixed Drinks, and Coffee !


Old: Moderately comfortable, minimum reclining

New: WOW. Just as good as first class, very wide, with a button to call for service.


Old: Big, Great sound

New: Same.


Old: $10 per person

New: $15 per person (The seats are MUCH wider, much more comfortable)

Restrictions to entry:

Old: None, Really. If your parents felt safe dropping you off, you were allowed in.

New: Because of the Adult Beverages, No child under 18 without a parent or adult over 21. This last restriction makes me wonder how profitable the entire model will be - Parents can no longer drop off their 16 year old children to shop and then head to the movie theater. This will upset most teenagers -- a big piece of the Cinema business.

The overall cost of the food is approximately the same as a quality pub, TGIF, or Applebee's, but the food was fantastic.

For an average family of four, the entire experience will probably average around $100 - $125 for an evening, if not more, plus tip.

It is a fantastic experience, and I am sure it will be more difficult to be the first one to see the movie on opening day - far fewer seats and far greater demand "for the experience". My guess is that we'll start seeing many more people buying the tickets online to ensure their place in the theater, which will add even more profit due to the online ticket surcharge most theaters charge.

A quick survey around the country of this kind of movie theater has ticket prices varying considerably - from $7.50 per adult ticket in Aurora, Colorado to a whopping $27.00 per adult ticket in Redmond, Washington, EXCLUDING the cost of the food !

I can't say enough how awesome this concept is - I just hope it is sustainable for the business !

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