Sneaky Ways Movie Theaters Get You To Spend More Money

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
a 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. Kim Moon: If they did
not have concessions, they wouldn’t be in business. Narrator: 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. Moon: So, when you walk into a theater, you will see tons and tons of imagery, as it relates to food and beverage. Narrator: 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
cases, visible at every angle. You can see popcorn popping, stacks of candy, and giant soda machines. Kit Yarrow: The big, huge boxes serve sort of like a billboard effect. They’re enormous 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. Narrator: 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. Yarrow: 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 of that stimulation. We’re queuing people,
psychologically, to want something. Narrator: And then there is the smell. Aah, 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. Thirty-one percent was from concessions. But AMC was able to keep almost 84% of that concession revenue as profit, compared to just under 50% that they were able to
keep from admissions. Basically, if you spend $1
on food, AMC keeps $0.84. But if you spend $1 on a
ticket, it keeps only $0.50. So it will do whatever it can to get you to spend more money on food. Moon: Buy one, get one free;
free upgrades; free refills; what they’re doing is
using price discrimination. Narrator: 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. Yarrow: They end up wasting
a lot of that popcorn, but, most importantly, they
end up wasting that money. Narrator: 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. Moon: 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. Narrator: 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 movie 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? Moon: Eat before you go.


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