The Problem: Cinema attendance has decreased and many cinemas have closed.
The Solution: Make films loss leaders for high-margin food and drink to get more footfall into cinemas.
Cinemas continue to have difficulties getting people to visit in enough numbers to stay open, and are set for further problems as more films move onto streaming sites.
From my own experience, a visit to the cinema is usually too expensive to justify on a regular basis, coming in at over £25 for film, popcorn and drink (what’s the point going to the cinema if you don’t get popcorn!).
Unless there is something I really want to watch, (such as Downton Abbey), or that won’t come out on DVD (such as National Theatre Live performances), I don’t go, and friends are the same; the cost if just too great.
I therefore propose shifting the cinema business model away from charging for tickets to instead charging for food and drink, and offering a wider selection and better quality than is currently available.
As such, I would offer a £20 a year membership to a cinema chain which gave 10% off food and drink and 20% off the price of tickets all year round, but which also offered a free cinema ticket when someone spent more than £15 on food and drink.
The cinemas would offer a wider range of food and drink, including pizzas and burgers for example, as well as a range of soft drinks and alcohol. All food and drink would be massively over-priced to ensure it was high-margin, but people would still feel they were getting a good deal as they would get a £15 cinema ticket for free.
The cinema would get some revenue from the £20 membership, which would also encourage people to visit more often through the year to make use of their discounts and offer price discrimination: only people who paid the membership would get the discounts. If they visited regularly, the cinema would earn from the food and drink sold, if they were infrequent visitors then the cinema would not lose out on much revenue as it had the £20 membership fee.
Such a scheme could change the nature of cinema; people coming back from work too tired to bother cooking dinner could go to the cinema to enjoy dinner and a movie instead of sitting at home with a takeaway. That would increase viewing numbers on weekdays, helping to fill usually empty screens, and on Fridays and weekends the traditional mass numbers could return as they used to.
There is even an option to improve streaming services; put films available on Netflix into cinemas, but only allow people with Netflix accounts to watch them, their account being their entry ticket. It would be free for them to go to the cinema to watch the film, and they would get discounts on food and drink, but it would also offer the chance to see the films on the big screen, not just on tablets and televisions at home.
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