Record-high ticket prices raise moviegoers' demands

As the cost of going out to see a film climbs, theater owners try to give customers more for their money.

By Bruce Kennedy Jul 23, 2013 1:57PM

Roll of tickets (Ingram Publishing/Getty Images)The cost of heading down to the local cineplex continues to go up. In fact, the median price of a movie ticket between April and June rose by about 5.5% compared with prices during the first quarter of 2013.


Industry observers say the rising price reflects changes in movie theaters -- and in what their customers now expect from the experience.


The National Association of Theatre Owners reports the national average price of a movie ticket during the second quarter of this year was $8.38, up from $7.94 cents in the first quarter.


Patrick Corcoran, the organization's vice president and chief communications officer, says part of that increase comes from the growing number of 3-D and IMAX (IMAX) versions of films now available.


"Roughly 60% of theaters (in the U.S.) have 3-D," he told MSN Money. "In terms of overall screens, it's . . . about 36%."


One big challenge movie theaters face is competing with what a growing number of consumers have at home. Research group IBISWorld reports that while average ticket prices rose steadily from 2008 to last year, movie theater attendance continued to drop.


Matthew McFarland, the company's movie industry analyst, notes many households have invested in their own digital-format and high-quality home entertainment systems with large screens. Those technological advances also allow consumers to download all sorts of content from online sources, including streaming movies and TV shows from services like Netflix (NFLX).


When you have all those viewing options at home, "going to the movies isn't really about watching something anymore," McFarland told The San Diego Union-Tribune. "It's about having an experience."


And theaters are trying to provide that experience to moviegoers by offering better facilities and food choices, along with reclining chairs, gourmet appetizers and, for a bit extra, food delivered to your seat.


The economic downturn has been hard on movie complexes, which shrank in overall numbers from 5,928 before the recession to 5,697 recently. But fewer theaters also means theater companies can invest in capital improvements, such as the industry's ongoing transition from analog (film) to digital formats. IBISWorld projects these consolidations will allow the movie theater industry to bring up its profit margins from a recession low of 0.2% to an expected 4.2% this year.


Corcoran, of the theater owners group, added that overall attendance at movie theaters this summer is running about 10% higher than it was at this time last year.


"We've got an awful lot of movies, and people are going to see them. It's as simple as that," he said. "We're pretty much the same movie theaters. What's different is the movies we've got."


More on moneyNOW

6Comments
Jul 23, 2013 2:38PM
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Only an action movie with great special effects is worth the costs of a movie ticket. I pity the poor kid who has to spend over $30.00 to go watch a chick flick with his girl.
Jul 23, 2013 3:35PM
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How can anything beat a big screen with surround sound in the comfort of my home, a fridge stocked with my favorites, and the bathroom right down the hallway. Also no travel, parking fee, waiting in line,  overpaying for marginal food. For minimal bucks, a GROUP can be royally entertained for pennies on the dollar. Wasting you bread going to the movies means you're traveling light in the marble department.
Jul 23, 2013 4:26PM
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It's not the cost of the movies that turns me off now - it's the other customers.  When did taking small children to adult movies become a thing?  Sorry, if you've got a child, you should just wait for the Blu-ray.  Why he heck should I pay $30 to take my wife to a movie and listen to your kid chatter throughout the whole thing?  I'd happily pay $40 to take my wife out to a movie if I could get an iron-clad guarantee that there would be no children under 10 in a PG-13 or higher-rated movie after 6:00 PM.  Bad parenting is our nation's new epidemic.
Jul 23, 2013 6:43PM
Jul 23, 2013 5:38PM
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I haven't been to a movie theater in at least 5 years!  Can't say I miss it.  Too expensive!  And only worth going if you're recommended to see an action flick with great effects and sound.  I agree with a previous commenter, not worth going for a drama, chick flick or cartoon.

Of course our 73" TV at home doesn't hurt!

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