Your local movie theater is the biggest QSR you know

30th October 2013
Concessions: Flickr Creative Commons photo by edenpictures

I spent 7 years working in the marketing department of a national cinema chain. It was a fantastic business to hone my craft and came with some nice perks – free movies and all the popcorn I could eat, to name a few.

What may surprise some people is that cinemas don’t make money from the box office. In fact, when ticket prices rise, it’s the studios that benefit from that revenue.

Theaters are just a group of QSR’s that shine a fancy light on the wall

While you may think your cinema is focused on the moviegoer’s experience, in many cases, the shining the light on the wall part that isn’t the thing they are good at. If you think about your recent movie going experience, it may include: complaints about poor audio, people talking, sticky floors and on and on. The real focus for many cinema franchises is generating maximum revenue per patron (RPP). Some like the The Alamo Drafthouse franchise are able to create value with both a higher-end movie going and food experience, but this is not always the case.

A large suburban theater may be home to five QSR restaurants. A large multiplex like this might contain two or three generic concessions stations, but also operate separately branded franchises that sell fries, hotdogs, frozen yoghurt, pizza and coffee. Like any quick service restaurant, cinemas diversify their product offering – not everyone is interested in popcorn – in an effort to increase their RPP.

The challenge

In many ways, running a QSR in a cinema is no different than a stand-alone restaurant. They have the obvious benefit of guaranteed foot traffic, but their rushes are extraordinarily time sensitive. If you think there is pressure to serve a hamburger quickly at lunch, try serving an entire rush of people who arrive within 15 minutes of each other, each with only minutes to spare before their film begins. From the point of view of the customer, every second they wait in line is another “good seat” in the theater taken. Even if they are comfortable they won’t miss the start of the film, they are envisioning spending the next two hours in the front row or between some rowdy teens.

If service is slow at a traditional QSR, people may grumble and a few will leave. You’ve lost that sale (and perhaps future ones). At a cinema, if you cannot serve a patron in the five minute window (they perceive) they have, you lose the popcorn sale and ad revenue from the pre-film advertisements. But, additionally, you may have to refund $40 or $50 in ticket sales – it happens more often than you think.

The industry has made headway in improving wait time. Adoption of franchises, for example: Canada’s Cineplex chain owns locations with Burger King, New York Fries and Yogen Früz, has meant those brands’ standards and processes have been imposed upon the owners, which improves the overall food service at locations.

Improving the perceived wait time

Like more traditional QSR’s, the perceived wait time a customer feels can be positively influenced by using bankers lines, opening tills in a strategic order and keeping interesting content changing on the menu boards. However, if a person misses the start of a film (or even a trailer), their evening out is ruined and the cinema has to compensate for that.

What are the food options at your local cinema? Do they affect speed of service or influence what location you attend?

Chief Operating Officer at LIVELENZ. Greg began working part-time in restaurants when he was 15 and continued in the industry for a decade. He then began working for technology companies developing a passion for improving operational efficiencies at fast-growing organizations.

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