Popcorn, candy and soda have always been fan favorites at movie theater concessions stands, but with ticket sales declining and entertainment options within the home growing, movie theater operators are looking for new revenue options and premium concessions via food service shines as one of the most profitable ancillary revenue streams. Today we’ll look at trends in the theater and how you can include dinner at the movies into your strategy for 2015.
Movie Theater Concession History
First, a brief history on why it’s taken so long for movie theater concessions to become more than just popcorn and candy. According to Patrick Corcoran, director of media and research for the National Association of Theater Owners, up until the last fifteen years, first-run movies wouldn't even play in theaters that offered food because it was thought to be distracting from the movie itself. Looking back even further, the first cinemas of our nation declined popcorn sales within the theater as it was thought to cheapen the experience by bringing noise and mess into what owners of the time wanted to be a sophisticated location. It wasn’t until the late 1920's when street vendors started selling popcorn outside the theaters to movie patrons and people passing by alike. Soon after seeing the missed sales opportunity, theaters began allowing vendors inside the theater lobby to sell concessions for a small fee.
Fast forward to 2015 and more and more theaters are recognizing the potential revenue bump from offering a wider variety of movie theater concessions. According to Time movie theater concessions are huge profit makers. Of each dollar spent at a concessions stand, about 85 cents is pure profit. With profit margins that high, it’s no wonder theaters around the world are looking to add options to their menus.
Movie Theater Concession Strategy
It’s not enough to just offer popcorn, candy and soda anymore, though these are high profit items. The rising trend is to offer full meal options to patrons and promote dinner at the movies instead of dinner before the movies. You’ll need to expand your food service equipment to offer a larger line of menu items and we suggest using the AutoFry and MultiChef, two of the leading ventless food service equipment options, to start your expansion. Ventless means you won’t need to add hood installation to your overhead cost of expanding your menu. Premium beverage equipment can also be brought in to expand the diners drink options from soda to higher profit items.
Once you've got equipment out of the way, you’ll have to explore how you’d like patrons to eat the food you’re serving. Without booths or tables you’ll need to provide your patrons with a place to put their food so they can enjoy it while watching the movie. An easy solution is to provide trays that clip on to the arm rests of pre-existing seating for those purchasing food. Another more pricey option is to designate specific theaters within the cinema as Dinner and Movie theaters and outfit them with permanent tables for food service. AMC is one of the largest food service cinemas in the US, offering the standard movie experience in addition to the food service movie experience. Their up-charge in providing food service is minimal and the return on investment has been great.
Another great revenue booster is adding the option to purchase alcoholic beverages at your theater as well. With high profit margins these adult-add ons can be a great compliment to your concessions strategy. Whether you offer beer, wine, mixed drinks or all three, you can tailor the offerings to what movies are playing at the time. Nitehawk Cinema in Brooklyn, NY actually creates food and drink specials inspired by the movies being shown each week. For example, this week you can eat the Good Bird (a fried chicken dinner) and drink a Method Gin Cocktail while watching Birdman.
Finally, you have to market your new offering to your patrons. Email lists, social media and even print advertisements all make for increased awareness of dinner at the movies. If you plan to offer specials related to specific movies, make sure you include that information on your website. Nitehawk Cinema does a great job of this by offering movie trailers, synopsis show times and menu options all on the same page. Even if a customer was just checking the site for movie show times they can’t help but notice the menu offerings and are more likely to purchase concessions than if they hadn't known in advance of getting to the theater.
The Bottom Line for Movie Theater Concession
When it comes to a night on the town, why shouldn't dinner at the movies be on your customer’s radar? Now is the time to expand your menu offerings and really enhance the movie going experience for your patrons. With the right strategy and marketing campaign to promote your new menu, you can really generate a whole new stream of revenue that movie theaters had previously ignored and really boost your profits.