The business model for movie theaters has been under threat since at least the 1980s with the widespread adoption of the VHS. DVDs, streaming, and the COVID-19 pandemic have only compounded the issue.
According to Octane Seating, 63% of Americans watch movies at home, which isn’t happy news for big chains such as AMC, Cinemark, and Regal. This is in addition to video games, smartphones, prestige TV, and every other form of media that competes for your attention in the 21st century.
Popular movie chains have been forced to get creative to stay afloat. Tactics such as luxury reclining chairs and top-shelf alcohol haven’t been enough. A new controversial way to bring in needed revenue is to add additional non-trailer advertisements in the preshow, increasing the length from 15–20 minutes to 30. So if you want to see a summer blockbuster flick, plan accordingly.
Let’s take a look at the timeline for this change and if it has impacted audience behavior.
Cinemark and Regal lead the way
In 2019, Cinemark and Regal reached an agreement with National CineMedia to add additional commercials in the preshow slot. One of these was dubbed a platinum spot and would play right before the attached trailers. The movie chains reportedly received 25% of the revenue collected from these prominently displayed ads.
National CineMedia CEO Tom Lesinski promised that this would not deter audiences, as a similar practice was already standard in Europe. “We don’t believe it will be a significant issue for exhibitors or consumers,” he explained in an interview with Deadline at the time.
AMC jumps on the longer preshow bandwagon
AMC initially rejected the idea, but six years later is changing its tune. On July 1, AMC joined Cinemark and Regal. The chain also made sure its patrons were aware of the change by emphasizing it in a disclaimer for ticket buyers.
When news of AMC’s change of policy broke, the movie chain issued a statement explaining the decision. AMC claims this change will not keep audiences away from theaters but doesn’t explicitly say anything about watching trailers.
“While AMC was initially reluctant to bring this to our theatres, our competitors have fully participated for more than five years without any direct impact to their attendance,” the statement explained. “This is a strong indication that this NCM preshow initiative does not negatively influence moviegoing habits.”
How has this impacted the audience?
While theater chains may claim the practice hasn’t impacted attendance, the timing of the COVID-19 pandemic and entertainment industry strikes make it difficult to isolate the exact reason for any changes in audience behavior.
Thanks in part to the “Barbenheimer” phenomenon of two summers ago, 2023 was the best summer box office since all of this drama came about, bringing in $13.6 billion globally. Last year, meanwhile, saw a 10.3% decline domestically over 2023, according to Comscore.
In June of this year, as reported by Deadline, Gower Street Analytics predicted the summer season would make around $12.4 billion in global box office revenue. Moviegoers appear to be holding steady.
However, even though audiences are still showing up, they are starting to skip the trailers. According to Steve Buck’s firm EntTelligence, only 60% of audiences were present for them this year. The numbers get lower in the movie-centric cities of Los Angeles and New York. Only 42% of Angelino cinephiles were present for every trailer, down from 55% last year. Only 42% of New Yorkers saw each trailer, down 5% from the previous year.
These statistics to reveal a potential catch-22. While theater chains have to stay open to new sources of revenue, they may risk repeat business as fewer audience members are exposed to their full slate of coming attractions.
“What if a trailer plays in a movie theater and no one sees it? What good does it do?” Tom Rothman, Sony Motion Pictures Group chairman and CEO, mused to Deadline. “It’s incredibly self-defeating and shortsighted. Since the beginning of the movie business, the single best inducement to see movies is trailers in movie theaters. And now, nobody sees them.”
Only questions remain. Will “the skipping the trailers” trend continue and even grow? Will this lead to opting out of going to the movie theater altogether? Time will tell. For now, be armed with the knowledge that you have extra time to get your popcorn without missing the movie should you so choose.
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