Movies: Why ticket sales are dropping

Last year, attendance at movie theaters continued a nine-year decline.

Americans are deserting the movie theater in droves, said Brad Tuttle in Domestic box-office receipts in 2011 were down 4.5 percent from the year before, despite increased ticket prices for 3-D and IMAX movies, while attendance continued a nine-year decline. Movie theaters sold 50 million fewer tickets last year than in 2010. “More and more people seem to be giving the modern-day moviegoing experience a thumbs-down.” The reasons are obvious, said the Los Angeles Times in an editorial. Hollywood now routinely churns out an “underwhelming and unoriginal” slate of sequels and action movies aimed primarily at a teen audience. But young people today would rather spend their money, and time, on astonishingly realistic video games such as Modern Warfare 3, which generated $1 billion in sales in two weeks. Older film fans, meanwhile, are taking advantage of “new technologies in the living room” to avoid high ticket and concession prices, waiting to see movies when they’re available via Netflix or on-demand.

To get their audiences back, theaters should consider lowering their prices, said Derek Thompson in The average price for a movie ticket passed $8 this year for the first time, and a ticket can cost as much as $13 in cities. Bafflingly, that price stays the same no matter what movie you watch, be it a “holiday-season juggernaut” like Mission Impossible: Ghost Protocol or an indie movie like Young Adult. This “one price for all” approach doesn’t make sense. Movie theaters have already made money by charging higher prices for 3-D and IMAX movies. Couldn’t they experiment with charging lower prices for smaller, less popular movies? Or even discounted prices on weekdays? That kind of “dynamic pricing” could fill a lot of empty seats.

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