The movie theater industry is in a weird place right now. The pandemic has been delivering massive blows since March 2020, and while there is clearly a demand for huge blockbusters (hence the spectacular success of Spider-Man: No Way Home), just about everything else released by Hollywood enters what could be described as a depressed marketplace. It's not exactly a stable situation, and as a result things are going to change with the implementation of new ideas – such as AMC Theatres starting to charge more for tickets to popular films.
Adam Aron, CEO of AMC Entertainment, took part in a post-quarterly earnings webcast today, and according to Deadline he revealed that the worldwide theater chain is going to be charging movie-goers extra to go see The Batman this weekend. There was no specific price differential mentioned, but casual research suggests that tickets for the DC Comics movie will cost between $1 and $1.50 more than other options currently playing on the big screen.
This is going to be a new thing in movie-going for the United States, but in selling the idea, Adam Aron noted that it is something that is already practiced in different variations around the world. He explained,
This is all quite novel in the United States, but actually AMC has been doing it for years in our European theaters. Indeed, in Europe we charge a premium for the best seats in the house — as do just about all sellers of tickets in other industries — take sports events, concerts and live theater. for example.
Economically, this is a super straight forward example of supply and demand. When a company has a product that isn't selling, they lower the price of said product to try and improve the market. And when a product (especially a limited one) is in high demand, capitalism dictates that prices go up to take advantage.
This tactic is especially effective when competition is low – and while obviously there are other major theater chains, none of them match AMC's expanse. The company is taking a calculated risk that regular customers will pay the extra cost to go see The Batman at the theater they most often frequent rather than hunt for a different location.
Will this be an effective tactic to take advantage of The Batman's popularity? Math would suggest it is. With the average ticket in the United States costing $9.37, raising the price by a dollar theoretically means a 10 percent boost to total profits. Making an extra $10 million off of a $100 million hit could be a nice way to get things back on an even keel after the disappointment of, for example, Death On The Nile (which only made $12.8 million in its opening weekend last month).
Should this pan out, it's easy to imagine AMC Theatres raising prices for all of the major blockbusters set to come out in the coming months – including Fantastic Beasts: The Secrets Of Dumbledore, Doctor Strange In The Multiverse of Madness, Black Adam, Jurassic World: Dominion, and Spider-Man: Across The Spider-Verse (Part One). The opening weekend performance of The Batman will likely dictate a lot, so be sure to check out the CinemaBlend box office column this Sunday to see how the situation shakes out.
