Tag Archives: AMC Theatres

AMC’s Premium Recliner Seating Plans Revealed

AMC recliner seats

A week after Regal announced that it plans to convert 25% of its screens to luxury seating, AMC has provided details about its plans for reseating. While the Chinese-owned exhibitor is not committing to a particular screen percentage target, the ambition is great for the cinema chain that in many ways kickstarted luxury reseating trend amongst the major exhibitors. AMC also continues to stress that reseating is only a part of its overall enhanced guest experience.

While attendance and box office was down for AMC in the forth quarter of 2014 (by 4.3% and 4.5% respectively), as well as for the year as a whole in line with the rest of the industry, the exhibitor managed to eek out an overall increase thanks to better concessions spend. AMC’s food and beverage (F&B) revenues per customer increased by 13.5% to $4.46 in the last quarter of 2014, a record high for the company.

Speaking at the Q$ 2014 earnings call (transcript by Seeking Alpha), CEO Gerry Lopez reminded the analysts listening in that when the reseating initiative was started three years ago it was not universally well received. “I don’t think I can use over an open line some of the adjectives and some of the names that we were called for this notion of taking two-thirds of the seats out of an auditorium,” he said. Yet today, “we’re seeing the same things that you are seeing which is everybody’s announcing them and everybody is doing them.”

At the end of the 2014 calendar year AMC had refitted or installed luxury recliner seats in 598 screens across 53 theatres, which represents an increase of 51% on the previous year. The reseated theatres are said to have delivered an increase in admissions of 13.8% on a per screen basis, compared to an average industry decline of 4.3%, in the last quarter of 2014.

Looking at the year as a whole, AMC claims that reseats delivered a 25.3% increase, compared to an industry slump of 5.6%. Taken together reseats thus delivered an 18 and 31 point outperformance for the quarter and the year.

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Regal To Convert Quarter of All Screens To Luxury Seating

Regal premium seat

Regal premium seats in Avalon, Alpharetta (photo credit: Jonathan Phillips)

The world’s largest exhibitor Regal has announced plans to convert 25% of all its screens to luxury seating. The move mirrors similar efforts by other large chains such as AMC and Marcus Theatres, and is an attempt to extract more revenue from patrons as cinema attendance declines in the United States.

The announcement came during Regal’s Q4 2014 earnings conference call when CEO Amy E. Miles gave an overview of plans for capital investments “to enhance the customer experience in 2015,” covering several areas including seating, concessions/F&B and more.

Regal installation of luxury recliner seats has been going on for some time, but was said to have gained ‘significant momentum’ in the last quarter of 2014. Significantly, a large enough installed base of luxury seating now exist to make meaningful year-on-year comparison in terms of revenue generated from premium seating.

Converted screens were said to be producing box office revenue growth in excess of over 40% for the first six weeks of 2015. While some of that can perhaps be attributed to the surprise success of “American Sniper”, one film alone cannot shift all converted screens. Overall box office was said to ‘only’ be up by around 10% in the same time period.

The success of the first wave of premium seating has led Regal to accelerate its conversion program, with 40 multiplex sites representing 500 screens scheduled to have their seats swapped out in the coming year. Ultimately Regal expects to outfit at least 25% of their screens with luxury seating.

Miles also discussed the “ low-cost, low-risk investment” to upgrade food and beverage offerings to offer greater food menu options and alcoholic beverages. Though not mentioned in the conference call, the latter may be “low risk” but still requires approval or local regulations to be amended and relaxed, which requires political action at the county or district level. This means that cinemas can only ‘convert’ to alcohol serving once they have local permission to do so, while the pace of rolling out luxury seating is Regal’s decision in conjuncture with the landlord. The “enhanced menu” will be rolled out to a further 65 locations in 2015, while Regal will offer some type of alcoholic beverage in around 80 properties.

Regal’s CFO David Ownby expanded on what the capex would entail in 2015 (transcript of the con. call by Seeking Alpha). “In light of the customer-focused initiatives Amy outlined earlier in the call, we expect our 2015 capital expenditures, net of asset sales and landlord allowances, to be between $135 million and $145 million.”

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Daily Cinema Digest – Wednesday 14 January 2015

AMC Wanda logo

USA (NV) – Is AMC going to ditch Imax for Dolby Cinema? Of course not, but this and other nuggets emerge from a Citi Global Internet, Media & Telecommunications Conference transcript with AMC’s Craig Ramsey, EVP and CFO, where he talks about the company’s five different strategies.

But to my point about our proprietary brands, I want to do a plug on — and we love IMAX. I’m not being negative against IMAX, because it’s been a great partner. But if you think about it, really there’s only one party that needs to make the decision on the proprietary brand whether a film is in the big auditorium with the big-screen, the big seats, and the Dolby Atmos sound system that you’ve spent a ton of money on, and it’s us. Because you don’t have to reformat that film.

And so you can deliver, I think, an IMAX-like experience over a broader range of product. Some that hasn’t been. So I think the growth opportunity, at least for us, we’ve got 17 of our private label and I think we have a big growth opportunity in more rollout of our AMC Prime proprietary product. In some cases where we also have IMAX, because the two can be complementary. LINK

Worth reading in full – this is after all the exhibitor that has 67% of the screens of Regal but generates 90% of the revenue that Regal does. Read about the ‘recliner’ strategy. Nothing is more important in the US exhibition business right now than seating. Repeat: nothing. Not even Imax/Dolby Cinema.

I don’t know if you’ve been — we operate — I said 344 theaters. 55 of those theaters we have remodeled, which has included taking out two-thirds of the seats. Where we had three seats, we have one. And that one is a plush, automatic, motorized recliner, which gives the moviegoer seat east and west more room, and north and south more room. We’ve — it’s been an unbelievable positive response from the guest, more privacy, greater comfort.

What you may be thinking well, but you’ve taken all that capacity out of the auditorium. You probably are missing some attendance because of the sellouts.

On the whole, our industry operates on about 11% capacity utilization. There’s a lot of room in this business to take seats out and deliver a better guest experience through a better seat. Recliner reseats, take two-thirds of the seats out, and attendance on average in these theaters has increased 50%. In an industry that is experiencing declining attendance, our recliner reseat theaters are growing attendance by 50% year over year. Pretty dramatic.

cineworld-logo.jpg

UK/Europe – Cineworld’s diversification strategy of spreading out across Central and Eastern Europe (and Israel) seems to be paying off in offsetting declines in cinema going in the UK, where higher ticket prices still kept profits ticking.

Cineworld has unveiled a blockbuster trading update, saying its full-year earnings will be at the top end of analysts’ expectations after it managed to persuade British cinema-goers to spend more on their tickets.

The company said that while admissions in its UK & Ireland business declined by 3.7 per cent during the year, this was offset by growth of 4 per cent in the average ticket price.

Visiting cinemas is not a declining trend across its entire business, however.  LINK

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How MoviePass Converted AMC From Foe to Friend

MoviePass and AMC

Last week MoviePass, the unlimited moviegoing subscription service, reached a major milestone in the development of their company and possibly the decades old theatrical exhibition business model. AMC Theatres announced an agreement with MoviePass for a pilot partnership that will let its patrons in Boston and Denver sign up for a premium MoviePass subscription package. The program should be in place in early 2015 in both markets, allowing film buffs to see every movie in cinemas, in any format, including 3D and IMAX.

MoviePass Premium, as the new package has aptly been named, differs from the company’s standard subscription which does not include 3D or large format showings. It also costs USD $45 per month instead of USD $35 per month for the standard subscription.

For those unfamiliar with MoviePass, the company offers a subscription that allows moviegoers in the United States to see an unlimited number of films each month at a rate of one per day. Each film can only be viewed a single time. These features and regulations will be the same between both plans, however MoviePass Premium subscribers will only be able accepted at AMC locations in the pilot markets.

Just a few days earlier I had made a note to check in with Stacy Spikes, the co-founder and CEO of MoviePass, to get an update on how the company was doing for a potential post. The AMC announcement gave me the perfect opportunity to catch up with him in what could arguably be seen as a moment of vindication for Spikes and MoviePass. After all, when MoviePass first attempted to launch a beta in June of 2011, AMC Theatres told its personnel to reject vouchers from the Netflix-like service. The program was quickly halted when other exhibitors complained and it took MoviePass nearly a year to relaunch.

So, I reached out to Spikes the day AMC published their press release concerning MoviePass and, as has always been my experience, he responded within minutes. We were talking by phone within the hour; no publicists and no fuss. If only speaking with all motion picture professionals for a story were that easy.

When asked how it felt to be partners with one of the cinema chains that once tried to thwart MoviePass, Spikes said with a deserved sense of joy, “It’s kind of like a hard fought fight, but it’s a beautiful thing. You know, data kind of wins the day. It’s hard to argue with people who sign up and then want to go to your theatre more often.”

Spikes always struck me as a shrewd business person, as he demonstrated by not holding a grudge against AMC. “I’m excited about AMC,” he said. “They are so smart and they aren’t afraid to take risks. I think we can do some great things.”

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Sony Hackers Crossed A Line By Threatening Movie Theatres

The Interview Premiere

Though most of the entertainment industry and business world has been riveted to every breaking development of the Sony Pictures hack, we have purposely refrained from writing anything about it. That was until the perpetrators of the cybercrime threatened movie theatres showing an upcoming Sony film release with terrorist acts.

Yesterday morning, in what has become an almost daily ritual since news of the Sony hack first surfaced the group taking responsibility for the cyber attack, who call themselves the Guardians of Peace, sent an email which threatened:

“We will clearly show it to you at the very time and places “The Interview” be shown, including the premiere, how bitter fate those who seek fun in terror should be doomed to.”

The email went on to state that “The world will be full of fear” and referenced the 9/11 terrorist attacks in New York and Washington D.C. It suggested, in no uncertain terms, that moviegoers should stay away from movie theatres screening “The Interview” and those that live near such cinemas should evacuate their homes. No specific reason was given, however since the hack against Sony Pictures first occurred it has been widely speculated that North Korea might be responsible for the attack in retaliation for “The Interview”, a film Sony had scheduled to open Christmas day. The comedy featuring Seth Rogen and James Franco centers around a plan to assassinate North Korean leader Kim Jong-un.

As a media outlet focused on the motion picture exhibition and distribution industries we were among those who received the hacker’s daily emails. Over the past few weeks we could have used this site to dissect the notes of countless DCI meetings from the past ten years or even highlight the terms of Sony’s various virtual print fee (VPF) agreements, details of which were contained in the staggered distribution of Sony’s data. However, there is a reason such information was meant to be kept confidential and its publication serves no greater public need. As well, the commercial matters being discussed within such documents is ancient history and any interest in them would be purely academic at best. That our silence came with the advantage of not publicizing the hackers or their crime was an added bonus.

But when the perpetrators took aim at the general public, threatening innocent people in a venue this particular media outlet considers a place of secular worship, they crossed a line that even the most malicious hackers know to avoid. Virtual thievery in the anonymity of cyberspace gives victims the false sense they are not in direct danger of physical harm. Threatening terrorist acts upon specific people or places in a world still smarting from an endless string of such events panics a public with feelings of immediate personal danger. That’s what makes such threats so affective and why the Sony hackers’ intimidation of movie theatres is far more damaging than any of the data they leaked.

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Answering A Few Hypothetical Questions About the “Interstellar” Unlimited Ticket

Interstellar Unlimited Ticket Meme

Two weeks ago AMC Theatres and Paramount Pictures announced they’d be teaming up to provide members of the cinema chain’s loyalty program, AMC Stubs, an opportunity to see “Interstellar” as many times as they’d like.

The Interstellar Unlimited Ticket, as the offering has been dubbed, costs between USD $19.99 and USD $34.99 depending on location. Stubs members who have already seen the movie can purchase an upgrade for USD $14.99. “Interstellar”, the latest film from director Christopher Nolan; a science fiction epic that was released to a great deal of buzz and in numerous formats, including traditional 35mm film, 70mm film, IMAX and digital.

In the press release sent out by Paramount announcing the program, Elizabeth Frank, AMC’s executive vice president and chief content and programming officer, stated:

“Christopher Nolan has created a masterpiece that movie fans are saying gets better every time they see it. The Interstellar Unlimited Ticket gives these fans an opportunity to experience the spectacular cinematography and heart-warming stories as many times as they would like – at any AMC location, any showtime, in any format, including IMAX.”

Not sure who these fans are with enough free time to sit through multiple viewings of a three hour movie, nor if that says anything about the unemployment rate in the United States, however “Interstellar” was one of this year’s most highly anticipated films and got pretty decent reviews. So, putting the question aside of whether there is actual demand to see “Interstellar” an unlimited number of times during its initial run, we contacted AMC hoping to get a few questions answered in an effort to write up a post that went beyond simply regurgitating the press release.

Thus, we are inserting the following obligatory statement:

AMC did not respond to multiple phone calls and emails seeking additional information and comments for this story.

We even went so far as to send the appropriate personnel at AMC some of the questions we had about the the Interstellar Unlimited Ticket, yet heard nothing back. Left with no way to cover the announcement in a manner that doesn’t come off as pure promotion, we came up with the concept of providing answers to the questions we had hoped to ask AMC. We’re not saying our answers are accurate, but simply educated opinions based on our own research and knowledge of the industry. Let us know what you think of them, and feel free to provide some of your own constructive answers in the comments section of this post.

When did the idea for the unlimited ticket program come about? Was it before the film’s release and, if so, how long did it take to put together?

The idea came about before “Interstellar” was released. One way to take a movie from being a strong success to an outright blockbuster is getting fans of the filmmaker or cast to see the movie more than once. Thanks to shortening theatrical release windows and the increased quality of home entertainment systems, the practice of seeing a release more than once in cinemas has decreased to an insignificant number.

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Regal Cinemas Causes A Disturbance In The Force

Regal's Star Wars Force Awakens Teaser Release

A few days ago you may have felt a great disturbance in the force, as if millions of PR managers suddenly cried out in terror, and a theatre chain was suddenly silenced.

Translation: Regal Cinemas learned the hard (and often harmless) lesson so many online retailers have already experienced on countless occasions.

While updating their customer-facing website over the weekend, Regal broke the news that a teaser trailer for “Star Wars: The Force Awakens” (a.k.a “Star Wars: Episode VII”) would be shown in a small number of theaters. The circuit’s website even went so far as to list the nine cinemas showing the teaser before all films from November 28th through November 30th. In a commendable attempt to be thorough, Regal also posted links to the announcement on Facebook and Twitter.

The only problem in all this is that the official announcement of the teaser trailer for “The Force Awakens” was meant to come from its director J.J. Abrams who had not yet made the news public. Oops.

The “incident”, if you can actually call it that, occurred early Monday morning setting off a nerd alert in certain sectors of the Internet galaxy. Though Regal quickly took down the webpage and deleted their posts on Facebook and Twitter, they were soon made aware (if they weren’t already) that once something is published online, it is impossible to erase. Screenshots of their webpage and even a YouTube video began making the rounds on social media and the blogosphere.

It wasn’t long before official word came from Abrams, via his production company’s Twitter account, that an 88 second teaser for the highly anticipated release would hit select theatres this Friday. Shortly afterwards Regal republished their webpage announcing details on where and when to see the “Star Wars” teaser.

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AMC Scores Promotional Hat Trick With “Big Hero 6″ Giveaway

AMC Big Hero 6 Pin GiveawayI awoke on Monday morning to a notification on my iPhone related to “Big Hero 6“. The latest animated release from Walt Disney Pictures had just topped the box office in North America during its debut weekend, fending off Warner Bros. “Interstellar” by taking in over USD $56 million.

The iPhone notification however didn’t have anything to do with the past weekend’s box office. Rather it was sent by the AMC Theatres mobile app I have installed on my iPhone. I have the app set to enable notifications and even allow for it to use my location. That’s why every time I drive past an AMC multiplex my mobile buzzes with a notification. I still haven’t determined if that’s annoying or not.

The notification concerning “Big Hero 6″, pictured here, was alerting me to a special promotion the cinema chain was running that gave away limited edition pins for the movie with the purchase of tickets. The message read, “Which Baymax pin will you get?” with pictures of both the pins featuring the huggable robot at the center of the film. One ploy in the promotion is that only one in ten pins will be of Baymax in his hero armor, presumably making those versions more valuable.

The ultimate catch in all this is that the giveaway is exclusive to members of Stubs, AMC’s loyalty program. I continue to pay for Stubs each year, always swearing it’s the last year I’ll do so. Even though I could personally care less about them, exclusive benefits such as these giveaways make more inclined to not question the annual Stubs membership charge. After all, my kids would probably love the pins… even though each would probably get different versions leading to arguments over who gets which one on the way to our seats.

I only point all of this out to highlight how AMC used the giveaway to score a promotional hat-trick. They promoted the film, “Big Hero 6″ and their loyalty program, Stubs, while at the same time reminding me about their mobile app (which I rarely use).

They may have even convinced me to head on over to the nearest AMC Theatres so I can see the film while supplies last. Maybe I can pay for my Stubs membership by selling the pin on eBay. At the time of this writing they are already fetching over USD $11.40 and counting.

Exhibitors Pin Their Hopes On Promotional Giveaways For Disney’s “Maleficent”

Regal Entertainment's Maleficent Giveaway

If Disney’s “Maleficent” fails to generate box office returns when it opens on May 29th it certainly won’t be due to a lack of marketing campaigns touting promotional giveaways. At least that’s the case in North America where the studio has partnered with two of the world’s largest motion picture exhibitors to run opening weekend promotions for the big budget movie which focuses on the villain from “Sleeping Beauty”.

Moviegoers buying a ticket to “Maleficent” at Regal Cinemas during opening weekend will get a free poster for the movie. It’s not clear from their promotional artwork (pictured above) or website whether the poster being given away is the official one sheet or if it’s a special poster created specifically for the Regal give away. Ironically, should the movie turn into a smash hit, it will be the latter which becomes more valuable in secondary markets such as eBay, since presumably such posters would only have been produced in limited quantities for the Regal promotion.

AMC Stubs Maleficent Pin Giveaway

That is the very approach being taken by AMC Theatres, which is using its “Maleficent” promotional giveaway as a springboard for a contest driven by social media. Anyone seeing the movie at an AMC cinema during its first few days will walk off with a collectible pin from “Maleficent” made exclusively for the exhibitor’s campaign. In an attempt to incorporate its own marketing push on top of the promotional giveaway, AMC is asking patrons to share pictures of themselves with their “Maleficent” pin on social networks such as Twitter, Facebook and Instagram. One winner will be selected to receive a USD $25 AMC gift card from those that submit selfless with the hashtag #shareAMC and #maleficent. This type of effort is meant to spark a network effect that builds awareness of the new release and ultimately the cinema chain.

AMC is also feeding into a tradition that has cropped up around the Disney brand over the years. Many die-hard Disney fans have taken up the hobby of collecting and trading collectible pins that feature characters, rides, attractions, etc. from the company’s movies and theme parks. Disney not only sanctions the practice, but encourages it by selling each collectible pin only for a limited time. Visit any of Disney’s theme parks and you’ll see loads of people walking around with pins that sometimes go back decades. Park cast members (as Disney refers to its employees) often have pins stuck to the lanyards holding their staff badges.

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AMC Theatres Expands Content Marketing Efforts With “Versus”

YouTube Preview Image

AMC Theatres is taking a page out of the latest marketing play books with its new online series “Versus”. The first episode was posted to their website, via YouTube, on Tuesday, January 28th.

The show is hosted by blogger John Campea and the format centers around two opposing advocates defending their viewpoints on a hotly contested issue. At least that’s Campea explains it. Not sure determining who gives the better super hero performance, Robert Downey Jr. as Iron Man or Christian Bale as Bat Man, is an issue that is either hot or all that contested. Even so, “Versus” marks AMC’s latest attempt at content marketing.

If you haven’t heard the phrase “content marketing” yet, I can assure you that will change soon enough. By the end of 2014 you’ll be bombarded with so much content marketing the mere mention of the practice might send you running in the opposite direction. You know, kind of like the way traditional marketing does now.

That’s actually why content marketing was born in the fist place; consumers stopped responding to traditional marketing methods, so corporations began to attract their attention by producing and distributing relevant and informative content. The marketing technique requires the creation of media such as e-books, blogs, magazines, videos, podcasts, etc. that enhance the entire category in which a company operates.

Some classic, often cited, examples of content marketing include the Lego Club and its associated magazine, which help promotes Lego and the Cleveland Clinic’s Health Hub, an online health resource published by the academic medical center. Probably the paradigm that sets the bar for most content marketers is the Red Bulletin, a magazine for adventuresome thrill seekers published monthly by Red Bull, which manufactures an energy drink. Red Bull has proven that the readership of the Red Bulletin matches the demographics of the customers they are trying to acquire. It’s also served to raise the public’s awareness of the brand itself.

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