Premium tickets run high in Beijing, but lower prices in smaller cities keeps average ticket price at the equivalent of $5.78 — still pricey given the country's low per-capita income
Big-city moviegoers in China are paying up to $25 per person to see "Iron Man 3," which opened Wednesday, while their rural counterparts could pay as little as $3 a ticket to see the same movie.
In that crucial, and growing, market for Hollywood, the government controls ticket prices. Under its tiered pricing structure, moviegoers in Beijing pay an even higher premium for 3D and Imax presentations than those in New York or Los Angeles.
In Chinese urban markets, tickets for premium showings of movies like “Iron Man 3” can cost between $15 to $25 a person, according to Chinese box-office tracker Entgroup. By comparison, Imax 3D tickets for "Iron Man 3" in L.A. this weekend cost around $20.
The Marvel superhero sequel starring Robert Downey Jr., which is tracking for a $160 million opening in the U.S., is expected to do even better in China than “G.I. Joe: Retaliation,” which opened to $33 million last weekend. “The Avengers” brought in $80 million from that market last summer.
In China, movies are considered a luxury for much of its 1.3 billion population.
The average ticket price was $5.78 last year, according to Entgroup, compared to $7.94 in North America. Bear in mind that the average annual per capita income in China was $6,076, opposed to nearly $50,000 in the U.S.
Ticket prices are higher in large cities due to real-estate costs and a greater reliance on tickets than in the U.S., where concession sales fatten the coffers.
BoxOffice.com editor-in-chief Phil Contrino, who visited China earlier this year, said that content — particularly Hollywood blockbusters — is keeping the multiplexes filled despite the high prices.
“Piracy is still a huge problem in China, and that makes it incredibly easy for people there to digest content at their homes,” Contrino said. “But luckily, spectacle can trump easy access. Chinese moviegoers want to be impressed by Hollywood blockbusters in theaters. That's why “Avatar” is still the No. 1 movie there.”
Nonetheless, establishing a workable ticket pricing strategy has to be priority for Chinese film officials, and will be critical for Hollywood studios banking on continued growth in that market. The Chinese box office reached $2.7 billion in 2012, up 36 percent from the year-earlier total, and trails only the United States.
Contrino believes it's a matter of when, not if, China supplants the United States as the world's biggest market. And he thinks that the movies Hollywood makes will have as much to do with that growth as infrastructure improvements.
“The culture is still figuring out the best ways to serve their citizens," Contrino said. "The answer seems to be mixing Hollywood production values with stories that speak to the average Chinese citizen walking the streets. When the film culture finally figures it all out, then that's when China will pass the North American box office. I think it's happening a lot quicker than most people thought it would.”