Rethinking the Megaplex: AMC's Plan to Boost Audience Turnout

America's 2nd-largest theater chain will cut auditorium capacities and replace existing seats with reclining versions. The company is banking on a quality-over-quantity approach to competing with home entertainment.

What's the Latest?

Going to the movies is a lousy experience. It's an archaic habit based on previous technological limitations that should have died out with Blockbuster Video, yet manages to survive because of cultural inertia and our inability to think up something better to do with our time (or money). 

That said, it would be silly to expect a world's worth of megaplexes to crumble overnight. But in an age of pervasive disruptive technology, the folks at AMC are beginning to smell blood in the water. The Wall Street Journal reports that America's second-largest movie theater chain is taking steps to reinvent the movie-going experience, and starting in their aging auditoriums:

The nation's second-largest movie theater chain is spending hundreds of millions of dollars outfitting a number of theaters with La-Z-Boy-type seats that fully recline—a conversion that removes up to two-thirds of a given auditorium's seating capacity. It's a less-is-more approach to a business that has long thought bigger was better.

What's the Big Idea?

The Wall Street Journal story states that AMC will spend $600 million to renovate about 40% of its auditoriums by 2019. Although a price increase is expected in the future, AMC's chief executive says tickets will cost the same for the first year after each "re-seating." Preliminary reports show that auditoriums with the newer seat set-ups experienced an 80% boost in attendance. The basic idea here: filling a comfortable small theater is better than having an uncomfortable large theater sit half-empty.

Auditorium renovations are a measured response to statistics that show a stagnation in movie theater audience growth over the past several years. Home entertainment services like Netflix and Hulu are often cited as major reasons for the flat figures. Rather than waiting for the problem to evolve, AMC is hoping to make the movie-going experience worth paying extra for. Market Analyst Eric Wold explained it to the WSJ:

"There are no more bodies coming through the door so you have to find something to get them to come back more often or pay more."

What do you think?

Does a change in the way movie theaters seat their audiences appeal to you?

Read more at The Wall Street Journal

Photo credit: withGod / Shutterstock

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