Movie theater attendance was down in 2011, but Tribeca's COO asks: What can we learn from pro sports?
By Jon Patricof
The preliminary estimate of a 4 percent decline in movie theater attendance in 2011 vs. 2010 is certainly not good news for the film industry.
That said, if you are in a room filled with the 48 owners of professional sports teams whose teams also saw their attendance decline in the last year or, more specifically, sitting next to any of the 21 team owners who saw their attendance decline by more than 4 percent, you would realize attendance woes are not ours alone.
Credit: Tribeca Film
Attendance at professional sporting events (NFL, NBA, MLB, NHL) in U.S. was flat in 2011 at 132 million. This amounts to about 10 percent of the 1.2 billion Americans who last year attended movie theaters.
And while the film industry gets bashed over rising ticket prices, on a national average movie ticket prices went up less than 1 percent from 2010 to 2011. This might look a little high relative to the MLB teams, which raised prices 0.6 percent. On the other hand, NFL teams raised them 1.1 percent and the NHL raised them 5.3 percent.
Many in our industry argue that movie attendance is down because the theaters haven’t been upgraded and the experience stinks… however, it seems facility upgrades and better concessions (and the associated price increases) don’t necessarily hold the answer. Look at the New York Yankees, who recently spent $1.5 billion on a new park but saw attendance drop 3 percent in 2011, or look at the World Champion St. Louis Cardinals, who play in an almost brand-new stadium and saw attendance drop 6 percent, or when you look at the Dallas Cowboys, who moved into a new $1.2 billion stadium in 2009 and have seen attendance drop from 2009 to 2010 and again from 2010 to 2011.
In contrast to sports and movie attendance, Broadway raised ticket prices 4 percent in 2011 and saw attendance up 5 percent! Spider-Man Turn Off the Dark just set the record for the highest single week gross in Broadway history.
In the first half of 2011, ticket sales for the top 50 music tours were down 2 percent. However, revenue from these tours was up 11 percent due to increased ticket prices. And the recent year-end report shows music sales rebounding, albeit slowly. Album sales were up 1 percent overall, with bright spots like sales of jazz albums, which were up 26 percent. Adele sold 5.8 albums, of which 1.8 million were digital—the highest ever.
So what does this all mean, and what should we look for in 2012? Here are some thoughts:
1. We in the movie industry are great at looking at ourselves and our shortcomings, but it’s important we spend time looking around at other people’s shortcomings (and successes too) in order to gather learnings and context.
2. While the macro-picture is interesting, it is of limited interest to many of us who work in the industry and are much more focused on how each of our companies and projects perform on an individual basis. So while there might be bad attendance news for some studios coming out of 2011, attendance at Paramount’s films was up 12 percent and Universal’s 15 percent . In pro sports, 11 teams posted double-digit gains in 2011, among them the Toronto Blue Jays, whose attendance was up more than 10 percent despite a worse record. The Cincinnati Reds also posted gains despite losing 12 more games and finishing 3rd, down from their 1st place finish in 2010.
3. Declining attendance at movie theaters or sports stadiums or concerts doesn’t necessarily herald an overall decrease in interest or economic upside from movies, sports or music, as we can see by the growth in TV sports rights fees (the new NFL broadcast deal has fees up 60 percent) or stabilizing music sales.
4. The focus has to be on the whole film experience: before, during and after the movie, both inside and outside the theater. And while the quality of films and play on the field is of paramount importance, it’s not the answer in and of itself. Some sports teams have done a great job of engaging their fans through the use of new technology and others by creating high-touch experiences at little incremental cost. For the movie industry it doesn’t just come down to better movies, better concessions and nicer seats (at higher prices). It needs to be about increasing fan engagement and focusing on the quality of the overall experience.
Jon Patricof is Chief Operating Officer of Tribeca Enterprises, the parent company of the Tribeca Film Festival and related entities. You can follow Jon on twitter @jpatricof.
The Future of Film blog is a place where leading filmmakers and experts within the film industry share their thoughts on film, technology and the future of media.
Follow Tribeca Film on Twitter: www.twitter.com/TribecaFilm
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Though I doubt we will ever go back to single-screen movie houses, I feel that if you want to get an film/movie-goers back to the theaters, giving them a larger than life experience is going to have to be a main focus.
Most of my movie going these days is either The Ziegfeld in Midtown New York, or the Loew's/AMC SONY REAL IMAX theater on 68th and Broadway. As expensive as admission is these days, I tend to cut out dramas and comedies. Not unless it's something I really want to see.
Studios and Theater owners are going to have to do some serious looking forward in regards to this.
2. Video and DVD and a thousand add-on features and focus groups and MBA weasels have demystified the film experience.
3. Lack of a film experience has hurt the film experience. People are more aware of money grosses and PR tags when they look at films than they are engaged in a story. It's consumer-fetishism as a watching experiece, replete with obnoxious sound design.
4. Yes, it is all evolving. TV series are more adult and involved than most films now--they have reversed roles. Theatres have turned into virtual reality park rides.
5. Where it goes? Time will tell.
Same thing for books. I can read it for free at the library, or if I really want to own it, buy it a few months later used for a fraction of the cost. And that doesn't even address the electronic book options.
The cost of movie tickets has put them into an event purchase instead of an impulse buy.
That makes the viewer think twice about which film or even if they should go in the first place.
The theater as a delivery vehicle for entertaining content is a sub-optimal venue and becoming more and more irrelevant as the quality of consumer electronics increases.
To expect a couple to pay out between $35-$50 for a single screening experience requires a commitment to a quality experience that is simply not there.
Hollywood makes about 250-300 movies a year.
1-3 per month are very good.
The rest poor or mediocre.
It's the same for books, music, theater etc.
So 10% of the movies are worthwhile.
It fluctuates a point or two from year to year.
But it's always been that way.
There were 20-30 good movies.
About the same as every other year, give or take.
Most of the Professional comments were that 2011 was a pretty good year for films.
Director Quentin Tarantino put together a rather eclectic list:
http://www.tarantino.info/2012/01/14/exclusive-quentin-tarantinos-favorite-films-of-2011-more/