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  • So, I just saw the new "Spider-Man".

  • The ticket cost $12, my popcorn was $8, the candy was $4.50, and my soda was $6.

  • That's over $30 for just one person.

  • Movie theaters are like theme parks or carnivals.

  • Once inside, you play by their rules.

  • And if you're like me, you spend way more than you expect to.

  • AMC isn't really selling you a movie ticket.

  • They're selling you this food.

  • You can't get in here without spending money.

  • It all starts with the ticket.

  • You might have heard that movie-ticket prices keep climbing, averaging over $9 nationwide, and almost twice that in big cities.

  • Going to see a movie means you have to spend at least the cost of admission.

  • But if you think that money is going to the theater, you're wrong.

  • Chains like Regal and AMC keep only about 50% of the money they take from ticket sales each year.

  • The bulk of that ticket price goes back to the distributor.

  • And if you want to see higher-quality format, you have to pay a huge premium.

  • But it doesn't really matter how much your ticket costs, because if you're going to a movie theater, chances are you're buying some food.

  • AMC reports that more than 71% of attendees purchase something at concessions.

  • If they did not have concessions, they wouldn't be in business.

  • That's Kim Moon; she's a marketing instructor at the University of Illinois at Chicago.

  • And she's right.

  • Without concession sales, both AMC and Regal would not make a profit.

  • So, when you walk into a theater, you will see tons and tons of imagery, as it relates to food and beverage.

  • Most movie theaters are designed so you have to walk past the concession counter.

  • The actual movies are tucked away down long, dark hallways.

  • But as soon as you get inside the theater, the food is bright, colorful, and, thanks to the glass case, visible at every angle.

  • You can see popcorn popping, stacks of candy, and giant soda machines.

  • The big, huge boxes serve, sort of, like, a billboard effect.

  • They're enormous and... and, so, calling out to you more than an appropriately-sized box.

  • When you open it up, though, it's about the same amount of candy in there as a small box that you might find at the drugstore.

  • All of this is surrounded by TV screens that loop beautiful shots of soda and popcorn.

  • Food is constantly grabbing your attention.

  • Unlike a restaurant, where the food is prepared out of view, a movie theater makes everything right in front of you.

  • Visually taking over the space, they also are physically taking over the space; it's really hard to get around it.

  • You kind of have to stop, figure out where you're going, and, in the process, you're being exposed to all that stimulation.

  • We're queuing people, psychologically, to want something.

  • And then there is the smell.

  • Ugh, that heavenly smell!

  • Ingrained in every moviegoer's brain is the smell of buttery popcorn.

  • This smell gets your attention as soon as you walk in and evokes a sense of nostalgia.

  • You probably don't eat a tub of popcorn and a box of Buncha Crunch at home, but here, you do.

  • And in bigger theaters, there might even be multiple concession areas.

  • If your auditorium is on a higher floor, get ready to pass by two or three tempting displays.

  • And because no outside food or drink is allowed, if you want to eat something during your two-hour movie, you have to get it at the theater.

  • OK, so you want to buy just one thing, something small and cheap.

  • Well, good luck.

  • All of the items at concessions are more expensive than what you would pay outside the theater.

  • And, often, you can't even find a small size.

  • So you have to choose between regular and large.

  • What does regular even mean?

  • The large seems like a better deal; It's only a dollar more.

  • So you may be tempted to spend a little extra.

  • And if you're going to eat all of that salty popcorn, you're probably going to get thirsty.

  • So, you'll buy a drink, too.

  • And that's great news for the theater because all of the food sold at concessions has a huge profit margin.

  • That means they're cheap to make but are sold at a high price.

  • Remember that $8 popcorn?

  • Theaters make a lot more on that bag of popcorn than they make on your ticket.

  • Let me show you what I mean.

  • In 2018, 62% of AMC's total revenue came from admissions, 31% was from concessions.

  • But AMC was able to keep almost 84% of that concession revenue as profit, compared to just under 50% that they are able to keep from admissions.

  • Basically, if you spend $1 on food, AMC keeps 84¢.

  • But if you spend $1 on a ticket, it keeps only 50¢.

  • So it will do whatever it can to get you to spend more money on food.

  • Buy one, get one free; free upgrades; free refills; what they're doing is using price discrimination.

  • That means they'll offer you a greater value with a larger size.

  • The margins aren't as good, but the theater is still getting more of your money.

  • And movie theaters love to offer combos.

  • Popcorn with soda, a hot dog with fries, candy and a slushy... pretty much any combination you can think of.

  • Unfortunately, those combos usually aren't a great deal.

  • Unless you're sharing in a big group, you'll probably be stuck with more food than you can eat and free refills that you won't use.

  • They end up wasting a lot of that popcorn, but, most importantly, they end up wasting that money.

  • Many theaters have also started offering things like alcoholic beverages and full meals.

  • These might bring a better experience, but they also allow theaters to charge an even higher premium.

  • Like this AMC deal that offers a hot dog, curly fries, and a chocolate-chip cookie for $13.

  • Combine all of this with bright-red colors, warm lighting on the food, and brand tie-ins, and it's tough to walk away from the counter with just one thing.

  • But the tricks don't stop at the lobby.

  • Theaters list movie start times that are 15 to 20 minutes earlier than when the movie actually starts.

  • This helps the theater in two ways.

  • It allows them to show more commercials before the trailers, which is another source of revenue, and it keeps moviegoers sitting and waiting for longer.

  • If you have to sit through 20 minutes of ads and trailers, you might give in and go grab a box of candy, especially if those commercials are for food and soda.

  • And delayed start times also remove the pressure of missing the beginning of the movie.

  • So you might not mind waiting in line for some snacks.

  • Each interaction is designed to get you to spend money on concessions.

  • Just look at the ticket window compared to the concession counter.

  • At this AMC, the ticket window is plain and not very stimulating.

  • But the concession counter is bright, colorful, and branded.

  • It immediately catches your eye.

  • But those are the tricks they use only when you're actually at the theater.

  • Theaters are also experts at getting you back to see another movie.

  • Reward points and special-access programs get consumers to go to the movies more often.

  • Gaining points for each dollar you spend is a great motivator to buy a little more than you normally would.

  • They report their members going to movies more often with the subscription than without.

  • And, of course, these members will bring their friends and their families, who will pay full price.

  • And if you saved money on your ticket with a program like AMC A-List, you might be more willing to spend money on food.

  • Some of these programs can actually save you money, but you shouldn't spend more just to get points or discounts faster.

  • Of course, if your loyalty program is on an app, the theater has 24/7 access to your attention and can send push notifications with details about promos and deals, like this AMC ad that offers free popcorn when you purchase a ticket for your friend.

  • Even when you're not at the theater, they're still trying to get you to spend money.

  • You might be pretty annoyed at movie theaters right now, but it's not an easy business.

  • Avid moviegoers want modern, well-maintained theaters with high-quality formats, and because so much of the ticket price is going to the distributor, theaters have to find alternative sources of revenue, which means snacks and drinks.

  • So, should you just stay home, throw some Orville Redenbacher in the microwave, and watch only what's on Netflix?

  • Of course not!

  • Going to the movies is supposed to be fun.

  • But you have to make sure the movies you're seeing and the food you're eating is what you actually want, not just something that has been constantly advertised to you.

  • And these tactics are employed best at big chains like Regal or AMC.

  • At a local theater, you'll often find cheaper concessions and tickets.

  • So, what can you do to save money?

  • Eat before you go.

So, I just saw the new "Spider-Man".

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