In an effort to provide updates on the CineAsia 2014 conference and trade show presently taking place in Hong Kong SAR, this post was written live, and in the present tense, during one of the conference’s presentations. Comments attributed to speaker(s) are paraphrased unless denoted specifically by quotation marks. [Also no spell check on my tablet version of WordPress. Sorry.]
The National Association of Concessionaries (NAC), the trade body of the popcorn, soda and other snack vendors, set up a mini-conference room on the trade show floor – similarly to Cine Europe one this summer, though larger. Each seat has a tote bag stuffed full with promotional soda cups, popcorn buckets, merchandising straws and drinks bottles. If there is any doubt where the real money is made in cinemas, this is it.
Building the Experience in Concessions Operations
Craig O’Connel takes the stage, promising raffles and prizes to the three-quarter full rooms. The seminar session is sponsored by Golden Link and Larry runs through the ‘Thank you’s’ to all the other sponsors. He then introduces Dan Barski , Exec VP of NAC (pictured above). He gives an overview of what NAC is and does. He correct the misconception that it is a ‘national’ body “because it is truly international and that is why we are here today at CineAsia.” He then gives a name check to Larry Etter, Senior VP Malco Theatres and Director of Education NAC, who will shortly take the stage.
But first, a raffle prize – a Kung-Fu Panda 2 Power Charger. With that over comes the presentation. Yesterday was Session 1&2 [which I missed]. The first part was ‘landscaping’, which “maybe is not as positive as we would like it to be,” Larry aknowledges. Then they moved onto service, which discussed what customers will expctin the future and how the bar has changed. “In the 1960s and 50s Coca Cola and popcorn was enough, but that’s not sufficient today.” Today is Session 3&4.
“We started yesterday’s second session with the emotional quotient, about how people make decisions. The next part is about financial profitability in how we sell. And there is a certain amount of intelligence required to do that,” Larry. He then refers to the book “Switch” about why people buy when they buy and for what reason. He talks about an elephant walkin thrugh a jungle (the emotions) and man sitting on top steering (the intelligence) and how they often conflict. Then comes the story of Larry’s wife going to shop for white sweaters. The moral is – they don’t buy one, even though plenty are on offer. The next day the temperature drops and they are cold. Then they are compelled to pick a sweater.
“What I want to talk about is the data and analytics that you need if you’re going to run your business efficiently and smart,” Larry proceeds. The quesiton he asks of his members is “What is your transaction time?” He asks a member of the audience who says “one minute” but doesn’t seem completely sure. “Very few people know what their transaction times are,” Larry observes and then talks about how many people get out of the line because they don’t want to wait. He opens the floor to suggestions about how to solve this issue.
“Kiosks”, somebody in the audience suggests. “Pre-sell combos with tickets” somebody suggests [that would be me]. But bundling is troubling, because studios want a cut, Larry observes. That is something that cannot be done in the US. Font size is another critical factor, which might not be obvious. “I always tell people to have at least a two-inch font (5 cm) at the display.” More suggestions: “loyalty programs” someone suggests. But how would tha speed up he line? Because that way you have data about your customers which fits the buying practices of your audiences.
Question is asked how long it takes to prepare pizza slices. 4-5 minutes is the average. “The more complex the offeirng is, the longercit takes to transaction. That is why I suggest no more than 13 different types of concessions. That means Coca Cola, popcorn, sweets, etc., but don’t go higher than 13 because people can’t make up their minds.” Larry mentions kiosks selling icecream or chocolate dipped fruit in multiplexes in Turkey.
Discussion switches to regional differentiations. In the Middle East they are selling more nachos than popcorn. “Those are their customs and buying practices,” Larry observes. Even in the US there are some candy that sells in one part of the country but not another. “Repetition – how do we get people to buy more and more?” Larry asks. “Upselling” somebody suggest, but Larry is after people going BACK to the concession stand. Unlike football game, people don’t go back. [Unless it is in India where films have intermission.] So Larry suggests free refills for large beverages, in his case 44oz. Only one in ten comes back, but that gives the cinema another chance to sell candy.
“Any time we sell a large tub of popcorn, we offer a free refill,” Larry says. Then he points to the back-to-back success of “Big Hero 6” and “Penguins of Madagascar” three weeks apart. He asks if the audience does surveys and checks how often they come back. In US only 12% come once every month, but they spend a lot of money on concessions he observes.
Next piece is scrutiny or secret/mystery shoppers. It is a fair way to evaluate from outsiders. “What secret shooper tells you is where you are falling short.” Concessions might be good, but if the toilet is out of toilet paper then customers are less likely to come back. “Every once in a while you might make a mistake. If this is repetitious, then you might want to correct it. That way you find out why your popcorn is cold or soda not fizzy enough. Reliability is an opportunity to use that useful information that you have. Take that information back and just fix one thing if you can. Then another in a month’s time,” is the call to arms.
Larry then puts up Malco’s data, from one location in a detailed spreadsheet, showing how they sold Ice Cup 12oz in a total quantity of 252 that weekend, but 896 large cups of 44oz of soda. Medium tends to be the most sold, but medium was ‘only’ 608 on this particular weekend, so Malco is doing well in upselling. He points to promotional cups, “because peoples’ eyes are drawn towards them. And people eat with their eyes.” He points to 387 1/2 litre Dasani and 205 large water drinks. His employees told them that they cannot upsell water, yet they worked on that, targeting people to lazy to get up for another water. It worked.
He then moves on to coffee, of which they only sold 10 coffees compared to 5,000 sodas that weekend. “The same thing is happening with health foods.” Malco sold 366 jumbo hot dogs. The number of picnic hummus that was sold the same weekend was… 1 (one), as well as 3 (three) turkey sticks. “Compare that to 210 extra nacho cheese with chili” and other examples of distinctly “non-healthy list” food. “What does this tell me? As much as media tells us we need to offer healthy options. We are entrepreneurs, we need to sell what people want to buy.” The exception is water, “which tells is that people want to buy less sugary drinks.”
Next up is ‘Competitive Advantages of concessions vs other food services.’ Larry notes that employees are more excited about selling Star Wars promotional cups than regular paper cups. Human capital can promote better strategic planning and drive execution.
“Is there productive data of telling us where to go?” Well, the healthy food data from the sales spreadsheet seems pretty unambigious. He gives the example of the hot dog that is all-natural, no MSG, no nitrates, no other ‘bad stuff’ that saw at least 30% increase in ho dog sales the first week alone. “If I didn’t know how many hot dogs I was selling prior to this change, I wouldn’t know the impact that the change has,” Larry enthuses.
Larry talks about the menu board and interruptive marketing. The problem with static boards is that they do not attract they eye. Malco sold out all their Penguin cups within 48 hours with the little trailer on the screen of Penguins dancing across it, as opposed to the normal two week sales window to shoft all the inventory.
Immediate cues – “people will make 11 decisions in less than 7 seconds about your business.” Here they are:
1. Clean (sanitary)
2. Safe (can a child swallow the toy, or is the condiment free of flies?)
3. Fresh (self explanatory)
4. Affordable (problem selling aluminum popcorn tubs, because people don’t see value. Internationally it is different).
5. Value (bundling, packaging)
6. Variety (points to Coca Cola, Sprite, Coke Light, Coke Zero, Dassani, energy water)
7. Fun/entertaining (key rings sold for Catching Fire)
9. Reliable (McDonalds has done it better than anyone else)
10. Up to date/technology
11. Worth a try
Priority shouldbe from the top to the bottom. Fun and Entertaining nowhere near as important as Clean and Safe.
Competitive advantage comes down to Harness the Data to Improve Customer Experience.
Larry says that when he joined Malco they were not even selling Kiddie Combos. They went from zero to 300,000 in the first year.
Per capita income is not as imortant as the money that you put in the bank.
Decisions that support objective. If you start offering hamburger it can lead to less sale of popcorn, which has a higher profit margin.
Use the data to better determine ROI.
Predictive Capabilities through data analysis.[At this point I realize that the Concession university is set to run for 2 hours and 45 minutes, straight through lunch – with NO break in the schedule. That is a long time to be listening to talks about food on an empty stomach.]
Larry now breaks down the different customer types: the perfect patron, the bargian hunter,the trouble maker, the teenager, the activist. Larry emphasises that people “think thin but eats fat.” But 80% of customers are the ‘silent majority’.
Break for more prize giveaways. Underwater camera from Sponge-Bob. [I’m thinking I’d rather want lunch than a prize.]
Now comes the fourth part: ‘The Roof’ that covers all the bases of what was going on before yesterday and today.
What is the last impression that the customer sees? The condiment stand, which is where Larry admits that is where the industry is falling short. “Value action over perfection,” is Larry’s message.
1. Find the need and fill it. Are there voids in your offerings? Seniors and elederly is an obvious next target for combos.
2. Customer Appreciation. End communication with a smile. Give customers that little extra.
3. Competent. Make sure your staff are trained / experiences. responsible.
4. Credible . Integrity.
5. Convenient. Easy to access.
The science behind concession experience: it is an environmental practice of escape. The degree of excellence comes in the form of exceeding expectations.
– Context (framework)
– Cue (controlls)
– Triggering (activation)
Treat all your customers with respect. Customers don’t forget attitudes.
Follow through on commitments, be responsible (at Malco they keep concession stands open until the last customer leaves)
Talk to me, tell me the good and the bad
Listen, don’t interrupt me while I’m talking (customers don’t care what you think, they just want you to listen)
Respond and face the music, answer the phone (in Malco it rings no more than 3 times – or else they get a written memo from Larry, and it’s not pleasent)
How do you treat your customers, what do they think?
Follow thru, customers don’t forget promises (“What kind of coconut oil do you use?” – I don’t now but I will call you back on Monday. Then call on Monday.)
Communication skills, be clear about what they should expect from you.
Be informed and knowledgable.
Be his/her advocate. Let customers know that you are trying to satisfy their needs.
1. Quality – declare your values
2. Value – the price is fair
3. Durability – holds its qulity over time
4. Availability – consistently there and on time
5. Apperance – entertaining and fun
6. Fits – meets the activities of the event
– No substitute for superior quality
– Patrons can forgive you for many things except poor quality
1. Competitive – reward the customer patronage
3. Verifiable – holds quality over time
4. Fits – meets the activities of the event
“That wraps up my part of the day” and Larry then thanks everyone for attending. The come a few more prizes. [I’m rummaging through the goodie bag for anything edible. There is a Coke Zero. I’ll take it.]
- MPA’s Charles Rivkin Brings the Charm to CineEurope 2021 - October 13, 2021
- UNIC Opens CineEurope 2021 With Optimistic Keynote - October 5, 2021
- French Cinema Attendance in “Free Fall” as Other European Countries Consider Health Pass Mandate - July 27, 2021