Movie theaters upgrade their menus
The Future. To offset debt and low attendance, theater chains are launching creative food initiatives to generate more revenue. The days of mere popcorn and soda are gone — now, moviegoers can indulge in flatbreads and cocktails. If theaters want to take back the power from streaming services, they might have to pull out all the stops to get people off the couch.
Build theaters to sell food
Movie theaters notoriously generate more profitability from concessions than ticket sales, reports CNBC.
- Revenue from ticket sales exceeds concessions sales by only 33%, according to Eric Wold, an analyst at B. Riley Securities.
- Almost half the revenue from ticket sales goes to studios, while theaters keep all concessions margins, which can amount to more than 80%.
- Marcus Theatres earns 44% of its total revenue from concessions, compared with 39% at Cinemark and 36% at AMC.
Concessions are recession-proof
“Throughout the pandemic, you’ve seen the average concessions per patron go up dramatically,” Wold tells CNBC. “That’s a combination of getting more out of each patron through increasing the basket size of what they order at the counter, but also getting more people to the counter who otherwise would’ve skipped it.”
Some theaters offer as many as 50 items on their menus and curate seasonal specials to pair with the movies they’re showing.
As long as studios continue to release their buzziest films in theaters, theaters will step up their food and drink game to retain customers.