New Owners Means New Competition For B-N Movie Theaters | WGLT

New Owners Means New Competition For B-N Movie Theaters

Sep 25, 2017

The end of summer marks the end of the worst summer box office for Hollywood in over a decade, thanks to an especially floppy parade of sequels.

Bloomington-Normal’s three movie theater chains aren't just waiting around for the movies to get better. They're spending big on renovations, adding customer-loyalty programs, and scheduling shows that aren't even movies. This increased competition locally is part of a larger problem facing theaters across the country—how to stay relevant in the age of Netflix, Hulu, and Amazon.

All three Bloomington-Normal theater chains have undergone ownership changes in the past two years. Marcus Theatres bought Wehrenberg and its theater on Bloomington’s west side last winter. This year, Marcus began renovation work “in the millions of dollars” that includes new comfy recliners and reserved seating, in addition to marketing programs like $5 discount days and a customer-loyalty program, said Marcus Chairman, President, and CEO Rolando Rodriguez.

"We wish that some of the films were better than what they were, and that's really what it comes down to."

“These are major investments that we make,” he said. “And we make them to make sure the price-value relationship and the type of experience we provide to consumers are in line with their expectations.

“We are a company that’s been around for 82 years in the theater business, and we hope to be around another 80. And the way to do that is you need to make sure you’re constantly changing and evolving and understanding your consumer better than you did the day before,” Rodriguez added.

(And in case you’re wondering, yes, the creepy whispering guy still appears before the show at Marcus’s Wehrenberg theater. A new “welcome” video featuring Rodriguez even pokes fun at it.)

New owners mean new competition. Starplex Cinemas in north Normal was bought by AMC in December 2015. And in a related deal, a new company called New Vision Theatres acquired the Ovation Cinema Grille dinner-theater in far east Bloomington in April 2017.

Before Marcus did it, reserved seating in comfy seats was kind of Ovation Cinema Grille's thing. That's the theater with waiters and waitresses who bring you beer, a sandwich, or popcorn. Looking to keep up with their competition, New Vision has already experimented with a date-night package and $5 discount Tuesdays. They'll be rolling out a moviegoers rewards program this fall.

John Halecky from New Vision said his company is putting a greater emphasis on food and beverage since taking over the Ovation Cinema Grille. That was one of 17 theaters in nine states that regulators said had to be sold as part of AMC's acquisition of rival Carmike.

“We have been introducing some local options, whether they be beverage options from local breweries, or favorite foods that are indigenous to a particular area,” Halecky said. “These changes will continue on the food and beverage side, but also on the some of the programming that happens in the theater.”

This consolidation and movement toward customer experience tracks with industry trends across the country, said Jeff Bock, senior box office analyst with Los Angeles-based Exhibitor Relations. It’s harder and harder for smaller theaters to stay competitive with larger chains, especially when a consistent product—aka, good movies—is not there, Bock said.

“That’s the way the entire business is going coast-to-coast. It sounds like what you have there (in Bloomington-Normal) is a microcosm of what’s going on everywhere in North American cinemas.”

Summer box office grosses were down 16 percent in 2017 versus last year. The biggest culprit were sequels that flopped, like "Pirates of the Caribbean 5" or "Transformers 5." Only three of them made more than their predecessors, which is rare, Bock said.

“People will come if you build a product that they actually want to come and see,” Bock said. “Right now, the quality of what’s on Netflix, HBO, and Amazon is far superior week in and week out to what’s in theaters. That’s the thing that Hollywood has to directly combat against.”

Rodriguez from Marcus Theaters agreed. He points to the recent success of the Stephen King adaptation “It" as a bright spot, a rare case of Hollywood delivering something audiences wanted to see on the big screen. It broke box-office records for the month of September.

“We wish that some of the films were better than what they were, and that’s really what it comes down to,” Rodriguez said. “When there are (good movies), clearly the consumer reacts and appreciates that this is an entertainment option that they want to pursue.”

It’s not just a one-year problem. People just don't go to the movies as much as they used to, and that’s not just compared to the 1950s or 60s when there wasn’t much else to do.

The trend line on moviegoers in the U.S. and Canada is on a downward trajectory. Admissions peaked in 2002 at 1.6 billion moviegoers, according to data from the Motion Picture Association of America (MPAA). Attendance fell to 1.3 billion last year.

Movie Attendance - U.S. and Canada
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To insulate themselves from Hollywood flops and draw in new customers, local theaters are looking beyond big-studio new releases. On a recent weekend, the list of movies at Marcus/Wehrenberg, for example, included several Indian films, plus re-releases like "Close Encounters of the Third Kind."

That's a relatively new development, Rodriguez said, adding that his company is driven by consumer demand. They even showed the recent McGregor-Mayweather fight on the big screen.

Across town at New Vision's Ovation Cinema Grille, they're scheduling more and more one-time-only screenings targeting niche audiences, like Broadway shows and opera performances.

“You can see a mainstream movie at any mainstream theater. Some of our competitors are so large that it’s tough to be nimble,” Halecky said. “We had to focus as a new company trying to cultivate what we call ‘cinema events,’ which are limited engagements of movies that might be obscure, foreign, or a little bit gaudy. But also live events that might not otherwise be available in the area.”

All of these programming changes have caught the eye of Adam Fox, the Town of Normal’s civic arts manager who oversees the Normal Theater, the historic arthouse cinema in Uptown.

But he welcomes any increased exposure for good film in the community. His theater, after all, has one screen and can show only so many movies each year.

“A lot of what they show—the major triple-A releases, the big-budget Hollywood films—are not the things we’re gonna have on our screen, or at least not for another 10-15 years when we can show it as a throwback, cult-classic type of thing,” Fox said. “We actually have a very amicable relationship with all of those places. They show the films we show, we show the films we show. And all of us together are getting people out of their house. Getting them off the couch. Getting them out to support film in the cinema, which is so important.”

For moviegoers, the bad news is that tickets aren't likely to get cheaper anytime soon, barring discount days and other one-offs.

They always tick up over time. A decade ago, the average ticket price in the U.S. and Canada was $6.55, according to the MPAA. Now it's $8.65.

“Part of that is probably a lot of the investment that AMC and other theaters have done that call for an increase in ticket price,” Bock said.

Movie Ticket Prices
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The theater chains say Bloomington-Normal remains a good market, in part, because it's a college town, filled with moviegoers interested in both blockbusters and off-the-beaten path films.

There's also some disposable income, and a reasonably diverse population that's lead to the Indian films popping up. Hispanics, which represent 23 percent of all ticket sales in the movie industry, are another demographic that could be better served, Rodriguez said.

Halecky from New Vision said the bad box office summer is all about the studios and their biggest movies. For theaters like his, the real story is what they do to get you out of the house and away from your smartphone in a room full of other people.

“It’s something inherent in the nature of humans,” Halecky said. “The greatest cure for cabin fever is a two-hour vacation at a movie theater.”

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