Despite plenty of gloomy forecasts, top execs at IMAX, STX and AMC are optimistic about growth in the theatrical movie exhibition business.
“Having great innovative product is the thing that makes it easier to succeed than anything else,” said AMC Entertainment CEO Adam Aron on Tuesday during a morning session at TheGrill 2016, at the Montage Beverly Hills.
Aron, who took over the movie theater chain at the start of this year — following years in the sports and travel fields — warned against being pessimistic.
“It’s not easy,” he said. “Far more movies flop than succeed. But if you look at the first three, four months of 2016 there was double-digit growth,” he noted of overall box office returns.
While Aron admitted that May and June of 2016 were “pretty tough” and that people in the media saw “storm clouds,” he emphasized that summer box office finished strong this year.
Noting the volatile nature of the box office, Aron asked, “Would you be as pessimistic about the movie business if we were having this conversation right after ‘Star Wars’ … or ‘Deadpool’ opened?” Indeed, both movies were enormous hits.
If you look at moviegoing now compared to 15 years ago, it has grown — from 1.21 billion in admissions and $4.35 average ticket prices in 1995 to 1.32 billion tickets sold and $8.43 average ticket prices in 2015.
What both Aron and IMAX Entertainment CEO Greg Foster said they’re laser focused on is improving the moviegoing experience for audiences.
“The best way to get people to a movie a second time is to give moviegoers a good experience,” Foster said.
“Sure, there’s cord cutting,” he added. “Like everything else, there needs to be course correction.”
Foster noted that IMAX has moved into virtual reality to create an added revenue stream to its core business of giant-screen movies.
“The experience in a good movie theater can’t be replicated at home,” said Adam Fogelson, chairman of STX’s motion picture group, a new studio that just enjoyed success with “Bad Moms.”
“I’ve watched movies in rooms with 10, 17 people, and I’ve watched with 400 to 500 people — and [the bigger theater] is a significantly better experience,” he said about the “communal experience” of seeing comedies and horror films with a theater full of other audience members.
“We’re laughing at the same jokes, screaming at the same scary experience,” Fogelson said.
When you have the right type of offerings at the multiplex, argued the STX exec, “people don’t want to stay at home.”