By Daniel Loria
What are some of the main points that art-house and independent exhibitors can take away from your presentation at Art House Convergence?
This is the first time NAC is involved with Art House Convergence, and we'll be talking about the value and benefits of concessions at art-house theaters. Interestingly, the average independent art-house theater only gets around 15 percent of its total revenue from concessions, whereas the typical circuit or chain theater gets around 35 to 40 percent of its revenue from concessions. We see an opportunity for the smaller independent theaters to improve their bottom line while also providing people with what they like on a trip to the movies. We always operate under the same philosophy: why should you allow people to leave your theater without eating if they plan to do so, whether it's before or after? It'd be wonderful to keep that money under one roof. In this case, hopefully with some creativity and real marketing savvy, we'll be able to find a way for art-house theaters to keep that money. I'm going to be doing a 75- to 90-minute presentation showing the benefits and trends in food, not just in concessions but also through many hospitality venues. We'll be going through product after product in the presentation; I'll have around 30 samples of everything, including bottled water, corn chips, and candy. It's a wonderful opportunity to engage with what can and what cannot work, examples that range from alcohol and dine-in to standards like popcorn and candy.
What sort of potential do art-house audiences represent in terms of concessions sales?
The average art-house moviegoer can go to the cinema almost twice as much as they go to any other theater. We're talking about going to the movies ten times a year instead of four. That speaks to the loyalty of those moviegoers. These are moviegoers that are usually more upscale, and that presents a wonderful opportunity. It's a different audience, so you need to be aware of trends like non-GMO to gluten-free and types of items that can appeal to that audience.
One of my favorite cinemas here in New York City draws an older crowd --let's just say they sell a lot of senior-discount tickets-- and it's interesting to see how that is reflected in their concessions strategy: they offer a variety of cakes and muffins that they display just as prominently as their popcorn and candy. How do demographics play into the equation?
Like any owner of a retail establishment, you need to know the demographics of your customers. What works in Manhattan, New York, doesn't necessarily work in Manhattan, Kansas. You need to know your audience, key questions like knowing if they have dollars to spend. If they don't, then you can always down charge some of the more popular items. In many ways you need to know your demographics in order to make your concessions business more profitable.
Hot food has been an important trend in exhibition as of late, but I can understand why more budget-conscious exhibitors might shy away from tapping into it. Are there any alternatives for smaller exhibitors who might want to try an extended concessions menu without having to take the financial risk it entails?
Some theater chains are hiring third parties so they don't incur the hassle or expense of opening up a kitchen. I know of locations that have opened up doughnut stands and bars that have been contracted out to third parties, receiving a percentage of their take. There are ways of getting around the overhead and liability issues involved in hot food.
What role does in-theater dining play in today's art-house cinema?
One of the largest members of Art House Convergence is Alamo Drafthouse. In my book they're an art house, but they're certainly a circuit as well if you see how they're growing and franchising throughout the country. They're doing very, very well. They've found a great way to make money through food and beverage. Companies like Alamo are just as good restaurants and bars as they are cinemas. We have members that focus just as much on their food and beverage as what they have on screen, because that's where they make more money.
How can NAC help art-house cinemas in their concessions strategies?
We pride ourselves on our work with smaller companies and entrepreneurial exhibitors and suppliers, and we've had a lot of success. We are obviously very excited to have great members like AMC, Cinemark, and Regal as part of our organization because they bring a lot to our company. But frankly, the ones who need our services most are the smaller companies that don't have the excess cash to do the research on their own. We can help them. We have the education and certification programs for them. In that sense, it's an opportunity to use the membership to extend their value.