retail news in context, analysis with attitude

by Kevin Coupe

Call it yet another example of disruption in action.

Business Insider reports on how Netflix and Amazon "are spending big bucks" to "beef up their selection" of unique content, which in retailing would be known as private label.

Netflix has said it plans to spend $6 billion on content this year. Amazon is believed to have budgeted $4.5 billion. The only media company expected to spend more on content is ESPN, which invests heavily on rights fees for professional sports.

This content is designed to make people want to stay home (and buy stuff, if they are using Amazon), rather than go to the movies.

Which explains a story in the New York Times about the AMC movie theater chain, where the plan is to turn concession stands into "full-fledged fast-food restaurants."

According to the Times, "It’s part of a strategy to attract younger audiences and stay relevant in the streaming age of HBO Go, Netflix and Amazon Prime. While small theater companies like the 25-location Alamo Drafthouse have been offering full-restaurant cinemas for years — AMC itself already operates a 60-location chainlet of Dine-In Theaters — this effort will bring greatly expanded menus to more than 400 theaters in the United States ... AMC Feature Fare will include cheeseburger sliders, four types of stone-fired pizza, chili dogs, salami bites, chicken tenders, three new popcorn flavors and — for the health-conscious — seven gluten-free snacks."

In short, the hope is that people will leave home if AMC can offer more than just digital projection and more comfortable seats - both of which have been a hallmark of the changes AMC has been making in recent years.

Of course, the Times also points out that there is at least a possibility that the chili dog that attracts one customer might annoy the customer sitting next to him or her. But it is a calculated gamble, and one that AMC feels it has to make ... because otherwise, its customers may stay home and watch Netflix or Amazon.

It has to make the gamble, because AMC sees the changing entertainment business as an Eye-Opener.
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