When I would go to the movie theaters when I was a kid, the options at the concession stand were pretty standard: popcorn, hot dogs, an assortment of candies, and soda. Sometimes — but not all the time — a theater would also have nachos. That was always exciting.
These days, however, the options are practically limitless. You can get chicken fingers, burgers, mozzarella sticks, pizza, salads, gourmet chocolates, not to mention all the classic choices previously mentioned. Eating at the movies is now like eating at a full-service restaurant.
So why the change? The simple answer: Competition. Movie theaters are facing more competition than ever from streaming services such as Netflix, Hulu, and Amazon, which are providing a vault of already-released movies and television shows as well as new original content, all delivered to a customer’s home at prices lower than watching a movie and getting food at a theater.
For that reason, big national movie chains like AMC Theaters and Alamo Drafthouse Cinema have introduced alcohol and premium food at concession stands. About a third of AMC Theaters now feature a bar called MacGuffins. And table service at the movies, which was few and far between just a short time ago, is now becoming commonplace.
In short, movie theaters no longer have a monopoly on premium content and must look to offer something that the streaming services haven’t tapped into yet: high-end food and booze.
How necessary is the shift? Do services like Netflix and Hulu really pose that much of a threat? Well, the facts don’t lie:
According to a report by the Motion Picture Association of America, movie ticket revenue and sales decreased by 5% last year from 2013.
Netflix members streamed 10 billion hours of content and the company added 4.9 million subscribers in the first quarter of 2015, according to a letter to investors.
Eighty-two percent of U.S. consumers are willing to pay up to $20 to watch a newly released movie at home, according to a study by Price Waterhouse Coopers.
Movie theaters are now at war with streaming services – good food and alcohol versus the comforts of home. Which side will prevail?