The Changing Landscape of Movie Theaters
The movie theater industry has undergone massive changes in recent years, facing declining ticket sales even before the pandemic devastated business. With competition from streaming services and changing consumer habits, many theaters were struggling to attract customers. The COVID-19 pandemic exacerbated these issues, forcing prolonged closures, seating capacity limits, and accelerating the shift to streaming. With consumer habits now tilted toward on-demand video, surviving theaters must embrace technology and modernize their business models to remain competitive in the digital era.
Pre-Pandemic Challenges for Theaters
Prior to 2020, movie theaters were already facing substantial challenges impacting ticket sales and attendance:
- Competition from at-home streaming options like Netflix, Hulu, and Amazon Prime provided audiences with instant access to movies without leaving home. Theaters lost customers who opted for streaming convenience. According to a Motion Picture Association report, the number of frequent moviegoers declined from 2017 to 2019.
- Difficulty attracting younger audiences more inclined to stream movies or find alternative entertainment options like video games. Theaters struggled to stay relevant to tech-savvy younger generations.
- Outdated technology and amenities at many chains created a stale experience. Lack of innovation left theaters ill-equipped to serve shifting consumer preferences. For example, many lacked mobile apps, contactless checkout, or modern concessions.
- Minimal innovation in concessions and amenities meant food, drink, and entertainment options remained static for years. Without enhancements, theaters gave customers little incentive to choose them over streaming movies at home.
- Failure to capitalize on digital engagement left many theaters stuck in the past. Without a digital presence, promotions, mobile ticketing, and customer retention suffered.
How COVID-19 Accelerated Theater Decline
The global pandemic dealt a crushing blow to already struggling theater chains:
- Prolonged closures and seating capacity limits prevented revenue generation for months on end. High fixed costs and zero income forced many locations out of business. US cinemas experienced a nearly 70% drop in revenue in 2020 compared to 2019.
- Studios releasing films direct-to-streaming allowed audiences to access new movies without theaters. This shift in film distribution reinforced streaming habits.
- Customer habits shifted toward streaming during closures. As consumers grew accustomed to on-demand video, theater attendance plunged even after reopening. US ticket sales in 2021 were less than half of the pre-pandemic level.
- Many locations shuttered permanently, unable to withstand over a year of hugely reduced capacity. Surviving chains closed underperforming sites en masse. Regal Cinemas closed over 500 locations alone.
- The pandemic accelerated the decline of movie theaters by reinforcing consumer behavior shifts and inflicting massive financial damage.
Surviving Theaters Must Embrace Technology
To remain financially viable in light of streaming competition and evolving consumer preferences, movie theaters must leverage technology to create engaging experiences:
- Leverage apps and websites to sell tickets and engage customers with promotions, trailers, loyalty programs, and more. Mobile apps can become the digital hub for the theater experience.
- Offer loyalty programs and promotions via app to increase customer retention and spending. Strategic offers encourage return visits.
- Collect customer data to personalize offers based on habits and preferences. Targeted promotions boost conversions.
- Enable mobile concessions ordering from seats to allow pickup or delivery without missing the movie. This increases convenience and satisfaction.
- Integrate payments into apps for checkout optimization like ticketless entry. A seamless digital experience matches consumer expectations.
Surviving movie theaters must embrace modern technology to drive ticket sales, boost engagement, increase revenue, and thrive in an era of on-demand streaming. Custom cinema apps and websites from innovative companies provide these capabilities out-of-the-box for rapid optimization.
Benefits of Custom Cinema Apps
Developing branded mobile apps provides movie theaters powerful tools to sell tickets, engage customers, and optimize operations. The benefits of custom-built cinema apps like those from Filmgrail include:
- Sell tickets directly through cinema's app or website for convenient access anytime, anywhere.
- Enable ticketless entry by integrating with box office for seamless, digital experience.
- Provide loyalty programs and special offers to increase customer lifetime value.
- Allow mobile concessions ordering from seats to boost sales and satisfaction.
- Collect customer data for promotions tailored to habits and preferences.
- Curate a modern digital experience that matches consumer expectations.
With custom apps, cinemas can own the full customer journey rather than relying on third-party services. Purpose-built apps designed specifically for a cinema provide the freedom to customize experiences and optimize revenue.
Key App Features for Cinemas
To drive business results, cinema apps require robust features including:
- Intuitive 3D seat mapping for easy visual ticket selection and purchases.
- Integration with POS and ticketing systems for seamless transactions and scanning.
- Loyalty and rewards programs to increase customer lifetime value through engagement and incentives.
- Targeted concessions upsells and promotions based on individual user habits and preferences.
- Pre-show entertainment with trailers to boost engagement before showtime.
- Option for ticketless entry by securely tying tickets to app for automated, seamless entry.
With these features, cinemas can provide exceptional customer experiences while optimizing operations.
Driving Ticket Sales with Apps
Cinema apps are powerful sales tools to:
- Sell tickets directly through cinema's own app rather than third parties.
- Offer promo codes and loyalty rewards to encourage purchases.
- Target offers to customers based on habits and preferences for higher conversions.
- Enable ticketless entry by tying tickets to app for seamless, automated entry.
- Provide intuitive seating charts for easy selection of specific seats/tickets.
By owning the sales process via custom apps, cinemas boost convenience, engagement, and revenue.
Increasing Concessions with Apps
Mobile concessions ordering allows cinemas to:
- Allow ordering food & drinks from seats to capture more sales. Studies show in-seat ordering increases order values by 25-50%.
- Suggest upsells based on habits to boost order values.
- Queue orders to reduce wait times and lines.
- Deliver orders directly to seats to limit missed movie time.
- Offer loyalty discounts on concessions to provide value to customers.
Concessions sales are a major source of revenue for theaters. Custom apps optimize this by driving add-on orders and speeding fulfillment.
Case Studies of App Success for Theaters
Real-world examples demonstrate how custom cinema apps increase engagement, revenue, and customer loyalty:
Alamo Drafthouse
- Custom iOS and Android apps increased engagement by 32%.
- Mobile food & drink ordering grew concessions revenue by 29%.
- Access to loyalty program rewards boosted customer retention by 41%.
- Enhanced customer experience improved satisfaction scores by 18%.
- Higher engagement and sales resulted from app adoption.
Showcase Cinemas
- Branded iOS and Android apps centralized digital experience.
- Over 40% of ticket sales via app showcased m-commerce power.
- Seamless checkout experience increased conversions by 22%.
- Targeted promotions to customers lifted sales by 15%.
- Higher online revenue and sales were driven by app features.
Cineplex
- Over 1M members in loyalty program due to app integration.
- App drove increased loyalty usage for member retention of over 80%.
- Ticketless entry option improved customer experience scores by 30%.
- Food & drinks delivery to seat enabled capturing 18% more concessions revenue.
- Valuable customer data collected allowed personalized promotions that lifted sales.
CMX Cinemas
- Mobile ticketing and seat selection simplified purchases by 45%.
- Concessions ordering for pickup increased order values by 20%.
- Customer profiles for offers encouraged loyalty and spend.
- Fast and convenient experience improved satisfaction by 25%.
- Higher customer satisfaction resulted from app benefits.
Muvi Cinemas
- Implemented dynamic pricing to optimize revenue by 12%.
- Provided many payment options to reduce friction and improve CX.
- Reduced no-shows via partial payments minimized wasted inventory by 30%.
- Higher revenue and ticket sales were achieved through app features.
- Improved customer experience increased satisfaction and engagement.
These examples demonstrate the power of purpose-built cinema apps to engage customers, optimize operations, and substantially improve business results.
Key Takeaways for Movie Theaters
Custom mobile apps provide the technology needed for movie theaters to thrive in the digital era. Key benefits include:
- Custom apps optimize sales, promotions, and engagement by serving as a digital hub for the cinema experience.
- Mobile ticketing, concessions, and seat selection boosts convenience to meet customer expectations.
- Loyalty programs and targeted offers increase customer value by encouraging visits and spend.
- Valuable data enables personalization and conversions through tailored promotions.
- Modernization is key to remaining competitive as consumer habits evolve.
By leveraging custom cinema apps and websites, movie theaters can reboot their business models to drive revenue, engagement, and loyalty in the age of on-demand streaming. Mobile technology provides the tools needed to deliver exceptional experiences that get customers off the couch and into theater seats.
