Are Movie Tickets About to Become Free? Five Takeaways from a SXSW Panel on the Future of Theatergoing

Liem Soeng

Are Movie Tickets About to Become Free? Five Takeaways from a SXSW Panel on the Future of Theatergoing

Few questions have loomed larger over the film industry since the pandemic than “How do we save movie theaters?” The streaming boom kept us entertained through years of isolation and provided media companies with a massive influx of content, but no business model has come close to offering the potential profitability and cultural impact of old fashioned theatrical releases. Cultural phenomenons like “Barbie” and “Oppenheimer” have proven that there’s still a large market for great theatrical movies, but some of the country’s top theater and marketing executives stress that one-off successes haven’t solved the industry’s deeper problems.

“All of our businesses are in the attention business and we’re fighting for people’s leisure time. There’s TikTok and there’s gaming and there’s this and there’s that, but the magic word is habit,” MoviePass CEO Stacy Spikes said on stage at SXSW on Saturday, March 9. “We have this really rich thing that’s still the cheapest thing you can do as a live event anywhere on the planet. But we haven’t given people the frequency, the consistency, the programming to make it a strong habit where you always know ‘Friday, I’m at the movies.’”

Related Stories

A night on a horse in the middle of a packed outdoor arena; still from 'Ren Faire'

The need to rebuild moviegoing habits is a common industry sentiment, but the path to doing so is increasingly blurry. In a panel conversation on Saturday afternoon, Spikes joined Alamo Drafthouse VP of marketing Chaya Rosenthal and the Cinema Foundation’s executive director Bryan Braunlich for a wide-ranging discussion about rebuilding those consumer habits in the 2020s. Here are the five biggest takeaways.

Cautious Optimism About Subscription Ticket Models

One of the first topics of conversation was subscription models that allow consumers to see multiple movies a month for a single flat rate. The best known example is Spikes’ tumultuous MoviePass experiment, which is launching yet another iteration that uses a credit system to give moviegoers multiple ways to acquire tickets. Individual theater chains have also found success with similar programs such as AMC’s A-List and Alamo Drafthouse’s Season Pass. Spikes has long been the world’s most prominent advocate for the idea — he founded MoviePass in 2011, then was fired after it was acquired by another company in 2018, then he stepped in and bought MoviePass back in 2021, following its bankruptcy. He gave a predictably passionate pitch for a subscription-based future at the box office.

“I’m gonna tell you what I think. The movie industry needs to focus on one thing: subscription,” Spikes said. “Why? Because if you get 30% of moviegoers to become subscribers, they will double their behavior.”

Rosenthal and Braunlich were less convinced that subscription ticket models are the future of moviegoing, but both emphasized that they have a place in the current industry landscape. Rosenthal noted that Alamo Drafthouse’s subscription program drives a high percentage of ticket sales for the theater chain’s repertory programming, a sign that the true value of subscriptions might be convincing the loyalest customers to attend even more additional movies.

Theaters Are Looking to “Event-ize” Everything They Can

A recurring theme on the panel was the fact that, while individual films can still draw large audiences with the right marketing, fewer viewers make standing habits of going to theaters without regard for the quality of the films.

“Back when we were younger, you went to the movies,” Braunlich said. “You didn’t necessarily go to a movie.”

If audiences aren’t going to theaters out of force of habit, Rosenthal explained that the impetus is on theaters to turn each moviegoing experience into a standalone event.

“What we like to do is create a relationship with our customers. We event-ize pretty much everything at the theater,” Rosenthal said of her approach at Alamo Drafthouse. “You don’t just have an experience where you’re there to see a movie. We offer a full menu, we offer a show before the show — you’re not gonna see ads, you’re gonna see a curated show that’s themed to what you’re seeing. It’s a whole experience, and everything is tied together with that.”

Concert Films Help the Cause — Up to a Point

AMC Theaters received a much needed influx of revenue in 2024 from distributing two of the highest profile concert films of all time: “Taylor Swift: The Eras Tour” and “Renaissance: A Film by Beyoncé.” But while both films were major events that packed theaters with music fans looking to experience the year’s biggest tours at a much cheaper price point, the executives all stressed that concert docs aren’t a panacea for a struggling industry.

“The concert industry is really interesting because it can be very hit or miss depending on who the artist is,” Rosenthal said. “It made me think ‘Who else can do this?’ … I don’t know how repeatable it is.”

Theatrical Distribution Needs to Get More Flexible

While theaters are often treated as a monolith for the purpose of discussion, moviegoing is a fragmented hobby that serves a variety of audiences. The needs of a small arthouse film are dramatically different from the rollout of “Dune: Part Two,” and Spikes called for the industry to recognize that by offering a wider range of exhibition options. As big movies get bigger and smaller movies get smaller, he believes that pricing needs to be more flexible to accommodate fluctuations in demand. He called for theaters to move towards a more dynamic model that raises and lowers ticket prices based on a film’s budget, proximity to its opening weekend, and the time of day.

Spikes also emphasized that, much like music, moviegoing is an experience that can thrive in a variety of different venue sizes. He suggested that there could be even more room for theater owners to offer custom experiences in dramatically different sized rooms than what many consumers are used to.

“The way the music industry has a 70,000 seat venue but then you can go listen to jazz in an intimate environment… I want to see different sized movies in different sized venues,” he said.

Hollywood Is Just Scratching the Surface of Monetizing Movies with Ads

When MoviePass famously rolled out its first ill-fated plan that allowed audiences to see unlimited movies for $10 a month, many thought that the exhibition industry would never be the same. The plan ended up being too good to be true, but Spikes is already dreaming of a bolder way to disrupt the industry.

“We believe there’s a world where you can actually go to the movies for free,” he said, suggesting that the film industry could eventually explore a business model where consumers’ willingness to watch ads becomes more valuable than their box office dollars. “I believe that an ad-supported version will be able to make a portion of moviegoing completely free. People will be able to earn credits related to watching that content offline that can convert into movie tickets.”

VIA

Leave a Comment