Ever since the first television set, the movie theater industry has had to compete with in-home entertainment. Despite digital distractions, domestic theatrical revenue reached $11.37 billion in 2016—a two percent increase over the previous year. Although the industry is adopting to the latest technology, serving alcohol and even encouraging phone use to keep young consumers in their theater seats year after year, they’re still struggling for growth.
Audiences between the ages of 18-and-24 attended an average of 6.5 movies over the course of 2016—more than any other age group, according to the Motion Picture Association. In addition, 79 percent of all frequent moviegoers own at least four different types of key technology products (smartphones, tablets, etc.) compared to 60 percent of the total adult population.
Young consumers keep coming back, but Disney’s executive vice president of theatrical distribution, Dave Hollis isn’t satisfied with the lack of growth.
“Even though we’ve had these gains in overall box office, we can also see that attendance has been more or less flat,” Hollis said during a state of the union presentation at CinemaCon in April. He stressed that while ticket prices have largely masked the problem, attendance simply isn’t growing—most likely due to increased internet usage and home entertainment. “This is disruption personified,” he said.
It’s not just gourmet food that keeps young audiences going to the movies. In an age where films can be binge watched anywhere and home releases are happening in shorter time frames, theaters entice moviegoers with the latest technology they can’t find in their living rooms.
There are 72 Dolby Cinema theaters in the United States with partner AMC, complete with laser projection and an advanced 360-degree ring of speakers wrapped around the audience. IMAX has opened a number of VR Experiences across theaters in the US, as well. The attractions offer movie tie-in experiences and video games for audiences headed to the movies.
“In the same way an IMAX movie gets you off your couch and into a multiplex, an IMAX VR Centre needs to be different and better, with premium content that’s highly interactive,” Rob Lister, chief business development officer at IMAX, told AListDaily.
Kids these days may not know who Sid Grauman was, but that doesn’t stop the historic TCL Hollywood Chinese Theater from attracting thousands of tourists each day. Among the hand and foot prints of Marilyn Monroe and the Marx Brothers, you’ll find celebrations of more current hits such as Harry Potter and Twilight. The historic location that hosted so many Hollywood premieres in its golden days now offers an IMAX 3D Laser theater, behind-the-scenes videos on social media and special offers for those to venture inside for a show.
The Chinese Theater also recently partnered with MediaMation MX4D for a “theater-to-arena” esports announcement geared to fully take advantage of the “dark weekdays” of movie theaters. The potentially game-changing model was on full display at E3 earlier this month. Sponsors like Soylent have already formed sponsorships with hopes of leveraging a new audience.
Meeting young consumers on their digital home turf certainly helps sustain ticket sales. Fandango allows social media users to purchase movie tickets through Apple’s iPhone messaging app and partnered with Facebook last year to do the same.
“I think these offerings we are unveiling are an important shift, not just for Fandango, but for Hollywood as a whole,” Paul Yanover, president of Fandango, told The New York Times.
These days, tickets are purchased online, phones are scanned at the theater and hashtags appear on-screen before the previews. Movie theaters post frequently on social media, offer giveaways and serve movie-themed cocktails at the concession stand.
“We’re competing with your home,” Hamid Hashemi, CEO of Florida-based iPic Entertainment, a theater chain that offers cocktails and gourmet food, told the LA Times. “It’s really simple. If there’s a way to watch a movie and improve the experience, why not do it?”
Some day, we may be able to step inside a film itself, Star Trek Holodeck style. In the meantime, theaters will continue to evolve with changing technology and consumer preferences to pursue that ever-elusive growth in ticket sales.