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Author
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Topic: Movies for $4 less in Ontario
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Ron Keillor
Expert Film Handler
Posts: 166
From: Vancouver, B.C. Canada
Registered: Jul 2003
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posted 01-27-2005 12:53 PM
POSTED AT 6:01 AM EST Thursday, Jan 27, 2005
By GAYLE MacDONALD
From Thursday's Globe and Mail
Toronto — Blame the almighty DVD, the splashy home theatre and the comfy armchair in your family room.
All those factors were cited yesterday for a stealthy drop in attendance at movie theatres that prompted Famous Players Inc., the country's largest exhibitor, to chop $4 off its ticket prices in Ontario.
Starting tomorrow, cinephiles will shell out $9.95, rather than the usual $13.95 for general admission, as part of a marketing ploy to lure warm bodies out of their homes and into the stadium-style seats.
The timing is impeccable for those keen to glean the Oscar worthiness of those contenders now flying planes, inventing Peter Pan, or boxing their hearts out on big screens across the land.
The Famous Players initiative is an across-the-board cut in Ontario and applies to all show times, any day of the week. Company president Robb Chase said his motivation for dropping general admission to under $10, its lowest level since 1998, is simple economics.
"Box office is up, prices are up, but attendance is what drives the health of the theatre business," he said yesterday, noting that while discount Tuesdays will disappear, seniors and children's prices will remain at $8.50.
Since 2002, North American box-office revenues have been generally robust, thanks to ever-inflating ticket prices. But admissions have declined in the United States and Canada -- a disturbing trend for movie chains, since the majority of their butter comes from high-margin popcorn and pop sales.
"It's a gutsy but business-savvy move," said Howard Lichtman, president of The Lightning Group, a marketing consulting firm.
"What Famous Players is trying to say is, 'Come to the movies. We've made it more affordable.' A dollar or two price cut wouldn't have ignited the attendance they're looking for.
"Now the $100-million question is will the strategy work to stimulate attendance?" Mr. Lichtman asked.
"The best-test case was our own Canadian model, half-price Tuesdays, where Canadians reacted dramatically to a one-day-of-the-week price drop. That not only changed movie-going habits, but lifestyle habits as well."
Mr. Chase said he blames a combination of things for the decline in theatre admissions, everything from improvements in home theatre viewing, more aggressive pricing of DVDs and videos, and the plethora of other entertainment options.
"All that kind of stuff is nipping around the edges of theatre attendance. So we added it all up and decided we needed to do something to give people incentive, to capture their imagination, to get them out to the movies more often."
Yesterday, Pat Marshall, vice-president of communications at Cineplex Galaxy, said her company had no plans to follow Famous Players' lead. "Of the 40 Cineplex Odeon and Galaxy Cinemas in Ontario, 30 out of the 40 theatres already offer the same or lower tickets for both adults and children/seniors than Famous Players' newly announced reduced ticket prices," she said.
"We pioneered this ticket-pricing model over five years ago in our Galaxy theatres."
But regardless of who did it first, movie lovers will no doubt be pleased, primarily because a night with Nicole Kidman or Jude Law was no longer cheap, costing two people roughly $50 in major cities once the $30 for two tickets and $20 for snacks are tallied. To that total, some people had to add the cost of a babysitter.
Paul Dergarabedian, president of the box-office tracking firm Exhibitor Relations Inc. in Los Angeles, said a $4 price drop might be the kick in the pants movie goers need.
"It's smart to think of the foot traffic," he said. "The more people who walk into the theatre, the more people buying popcorn and soda, which is what propels their bottom line."
In 2004, 1.51-billion tickets were sold in North America, according to Exhibitor Relations, down almost 2 per cent from 2003. Attendance of 1.54-billion in 2003 was off almost 4 per cent from the modern benchmark of 1.6-billion in 2002 -- the year of blockbuster hits such as Spider-Man, the sleeper My Big Fat Greek Wedding and Harry Potter and the Chamber of Secrets.
Trackers such as Nielsen EDI and Exhibitor Relations estimate that the haul from the North American box office in 2005 will be $9.2-billion (U.S.) to $9.4-billion, in the range of the record $9.3-billion set in 2002.
So, studios are obviously not hurting, but an increasingly large chunk of overall movie revenue is coming from DVDs and videocassettes, with combined consumer spending on home video totalling slightly more than $22-billion in 2004, according to Exhibitor Relations.
Since the early 1990s, Famous Players and Cineplex Galaxy have gradually rolled out price discounts in markets such as Victoria, Calgary, Ottawa and Montreal. In almost every instance, both firms say, attendance has grown.
For now, the price change at Famous Players is temporary. But Mr. Chase said "if the audience reacts the way we hope they will, we will be very inclined to keep it in place."
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