The future of the movie industry has been a hot topic in recent years, with more individuals turning to in-home viewing, and more movie studios reaching out to 3D technology to compete.
According to Sean Phillips, executive producer of Yahoo! Movies, ticket sales for the current summer are down by 7% to 8% over last year — yet ticket prices are up by 40 cents per ticket on average, the highest year-over-year increase in ticket history.
“The summer movie season was a bit disappointing,” said Phillips. “Studios relied heavily on the strength of 3D movies, but I think the titles just weren’t compelling enough this year.”
Phillips said that although Toy Story 3 and Iron Man made for a great start to the summer, overall audiences — and some of the studios themselves — were let down.
“When studios are spending more to make a movie in 3D, they want to make sure the fan base is already there, but it’s not a sure bet,” said Phillips, who referenced Sex and the City 2 as one that surprised Warner Brothers when it fell flat this summer.
But 3D isn’t just for theatres anymore — 3D TVs have recently been introduced to the market by manufacturers like Sony (NYSE:SNE) and Samsung. However, Phillips said we are about three seasons away from those being “even remotely a competitor.”
“Going out to the movies is still an event. People are still willing to spend their $6 for a bag of popcorn, and it’s part of our culture,” Phillips said. “A movie is still one of the most affordable nights out you can have when you leave the house, and anything that falls on the cheap end of the spectrum like that, people will continue to gravitate to it.”
But the reasons why people are drawn to movies has changed, according to Kirthana Ramisetti. Managing editor at survey company Predicto.com that polls individuals on a Friday afternoon about their weekend movie-making decisions.
“What we have found is that there is a fine line between people knowing too much about a movie and knowing just enough to be interested,” Ramisetti said. “With Inception this year, people rushed to see it because they didn’t want the ending to be spoiled, and they wanted to be a part of the conversation.”
The summer movie season overall reflects that a little mystery and a good topic will trump an “A” list movie star any day, according to Ramisetti . It’s the concepts — not the celebrity — that attracts moviegoers today, she said.
Of course, the term “moviegoer” today can have many different meanings. In-home movie company Netflix (NASDAQ:NFLX) boasted 15 million customers in June of this year, up from 13 million last year. When the company got its start 12 years ago, it sent DVDs by mail, yet now the company offers “instant streaming” and movies can be watched within seconds of pushing play.
Arguably, services like these have forever influenced the coveted box office draw. But Steve Swasey, VP of corporate communications for Netflix, said the company has only changed the way Americans watch movies at home.
“We believe Netflix members enjoy going out to the movies as much if not more than other Americans,” said Swasey. “Look at it this way: if you like to eat, you find lots of different ways to do it. You’ll cook at home, you’ll go out to a restaurant, you’ll go over to a friend’s house. It’s the same thing with movies. You certainly haven’t seen a decline in box office take because of Netflix.”
Netflix stands only as a compliment to the box office, Swasey said, and although Netflix has evolved to offer movies in multiple formats, theatres are evolving, too. Swasey pointed to the evolution in surround sound, IMAX and now 3D as reasons why the theatre-going experience will never die.
Just as the way people watch movies are changing, the way people buy tickets is changing too — in a way that shows movies are evolving as an “event” experience, according to Joel Cohen, CEO of MovieTickets.com
People are booking movie tickets in advance just like they would a Broadway play or other events. According to MovieTickets.com, the “advance ticket” window for purchasing tickets before a movie is expanding. What was originally a one to two-week pre-purchase window is now as long as six weeks.
“Advance ticketing really gives us tremendous insight into how well a film will do,” said Cohen. “And the only reason the window has expanded is because of increased demand. “
Five years ago, only around 5% of a show’s seats would be pre-ordered. Today, that number falls somewhere between 10% to 20% depending on the area of the country. Demographically, around 32% of MovieTicket.com’s customers are between the ages of 35 to 49, while almost 50% of customers are between the ages of 17 to 34, showing a greater interest in advance ticket purchases from individuals who are younger on average. As this tech-savvy demographic ages, the trend will only increase.
So what’s ahead for the fall movie season?
“The big night out at the movies is still a big thing,” said Cohen. “You find things there you can’t replace, people get together in groups and dress up, and that’s the kind of thing that can never be replicated at home.”
According to MovieTickets.com, the top three anticipated movies coming up this fall are Harry Potter and the Deathly Hallows Part 1, Paranormal Activity 2, and Wall Street: Money Never Sleeps.