retail news in context, analysis with attitude

Yesterday's Wake-Up Call cited two New York Times stories that I thought taught an interesting lesson. One had to do with how movie theaters are seeking new ways to attract customers (like undulating seats, scent machines and 270-degree screens) to compensate for the fact that young people simply don't go to the movies like they used to.

Part of the reason is that they have options like Netflix, which was the subject of the other Times story that examined how its entire global strategy - including spending hundreds of millions of dollars on original content - is keyed to getting people to stay home.

I commented, in part:

It is very simple, in my view. Successful consumer-driven businesses have to provide unique content in a compelling and differentiated environment. Do that, and consumers will come. Be a "me, too" business, and people will find other places to spend their money.

One other thing. I'm willing to go on record right now as saying that movie theater companies are going to have a better 2015 in terms of box office receipts than they experienced this year.

The reason has nothing to do with undulating seats, scent machines and 270-degree screens.

Nope, it has to do with a little movie coming out next year called "Star Wars: The Force Awakens."

Because differentiated content is the key to differentiated success.

I got a fascinating email from Gerry Lopez, who for the purposes of this email should be identified as the CEO of AMC Theaters:

I completely agree with your point on content.  Totally.  It would be silly, and impossible, to argue otherwise.  The evidence is overwhelming in this regard.  Some of those alternatives that younger folks are choosing to spend their time on are, make no mistake, all about content.  Case in point: video games.  They may have, at one point, been about technology.  today... all about content … in fact, content the user controls, which we can't (yet, anyway) say about movies.

We call it "the experience".  More specifically, the customer experience when the movie going. Is the theatre clean?  Are the chairs comfortable?  Is the popcorn warm and the Coke cold?  Is parking convenient?  The list goes on, and it starts even before the customers arrive at the theatre... how convenient / easy were showtimes to find and tickets to get?

Combined, great content and a great experience make the only case we have for relevance.  and, at the end of the day, that's the holy grail... we have to stay relevant.

To stay relevant, at AMC, we have embarked on a significant push to improve the guest experience.  we have five strategic action fronts to that effect:  a) comfort and convenience;  b) enhanced food & beverage;  c) guest engagement & loyalty;  d) premium sight and sound;  and e) targeted programming.

The most notable of these, so far, is a) comfort and convenience.  this is what has led us to fully remodel almost 50 buildings and 550 screens with plush, fully adjustable, electric recliners, not to mention re-vamped lobbies, bathrooms, box offices and in most cases, full service bars. Those all address comfort, and we've also tackled convenience:  today our showtimes and tickets are available on more websites than ever before.  Reserved seating is being rolled out across the circuit.  I'm sure you saw the "Unlimited Ticket" we put in place for Interstellar.

The impact?  In those 550 screens, the attendance gains this year are in the 50% range.  That's up 50% year-on-year for those 50 buildings, this at a time when the industry is down mid to high single digits.  There is in the neighborhood of a 60-point swing between the industry and where these theaters are as a group.  That's attendance and Box Office, never mind revenues and profits, but you can imagine what happens there when suddenly 50% more human beings are coming through the front door.

Why those results?  Because we're relevant.  Those kinds of gains can not be achieved if we're not bringing along all segments of our audience.  All segments.  Focusing on a well laid out strategy, executed relentlessly, spearheaded by comfort and convenience, has helped up build relevance with all segments.

All of which sounds pretty close to what a lot of customer-facing businesses need to do.

FYI…I'm a big AMC customer. I probably see 35-40 movies a year, and the majority of the time I go to the AMC/Loew's theaters in Port Chester, NY.

From another reader on the same subject:

I think one of the obvious issues for the decline in movie attendance, besides the fact there have been too may re-treads of old movies/themes, is the simple fact that the prices being charges are too high. When you factor in the ridiculous prices being charged for a glass of pop and a bag of popcorn (which cost only pennies to make), it is costing $40+ to get two tickets, a bag of popcorn and a couple of pops to go see a 1 ½ - 2 hr movie – as much as going out to dinner. If you want to throw in dinner and a movie, I think it has gotten to a point of simply being more than a lot of people want to pay, especially when there are so many other options, like Redbox or Netflix.

True, prices are up. I guess I pay about $12.50 per ticket … and while that's a lot more than what it cost when I was young, I think it is fair to say that gasoline, books, clothing, and pretty much everything else costs more, too. When the movie is good, the $12.50 is a bargain. When the movie is lousy, not so much.

My other lead piece yesterday was about how Black Friday was less busy, presumably because retailers have turned the day after Thanksgiving sales into a week-long or even month-long event. One MNB user wrote:

All the drops in TG Black Friday and cyber Monday are due to the Millennials watching more digital movies and shows and the Boomers going to the movies?

Not sure that's exactly what I said.

Yesterday, I also took note of a report about how Meredith Corporation is bringing out a new quarterly magazine, Eat This, Not That! that is based on the longtime column in Men's Health magazine, which features articles on topics like recipes to maximize nutrition and weight-loss impact and a guide for making smart decisions when dining at well-known restaurants."

I commented:

Because what the world really needs is another magazine. Not to mention another diet-oriented magazine.

Which led MNB user Dean Balsamo to write:

For someone like yourself who relies on  print-even if electronically delivered and who has such a strong love of movies- it was surprising to hear you take such a cheap at another vehicle for printed information.

Should we stop making movies about subjects that have already been covered in movies:  American Revolution, WW 1 and 2, Korean War, Vietnam War, anything having to do with rape, relations between different races, religions, political systems, cab drivers, gangs in New York, Chicago, Mexico City….., any kind of love story between men and women, men and men , women and women, space travel, astronauts who get lost, die, rescued in space…

Maybe you like many others subscribe to the notion that the Web has all but destroyed the magazine industry and that publishing new magazines is futile waste of time, money and the paper to print it.

Yet people still do it. Why?

Your comment suggests that we’ve learned all we can about diet and implies anything else relating to the mission magazines have-the dissemination of knowledge, stimulation of discussion and controversy (remember the general fired in Afghanistan over comments he made or the Boston bomber cover in Rolling Stone?), and contribution to a store’s sales-even same store comps-when the selection of magazines - tailored to the retailer’s clientele-drives sales on the topics and products featured in magazines devoted to food for instance-and when those magazines with the higher cover prices sell-and they do.

You yourself are constantly presenting links to or commenting on articles you find talking about the need for retailers to delve deeper in the mysteries of consumer behavior, the buying habits of different generations and so on. If no one thought they could do a magazine (or anything else) better by bringing so new insight or approach-where would we’d be? How would new approaches come about?

And that’s on macro level. What about the changes and the things the people doing this magazine will go through? What will their experiences with this project do for future endeavors they might be involved with?

Since when has human society felt it had learned everything that had to be learned, said everything that had to be said, said and presented everything in some definitive way eliminating the need for anyone else to try their hand, put their own voice out there, tried their hand at disseminating information in their own style?

Why design and build new cars, appliances, write new newspaper articles about the same subject of topical interest, or even do another email newsletter?


I was really just being a wisenheimer.

Maybe I was being a little glib, though I'm also thinking that maybe I hit a nerve.
KC's View: