This past weekend, we went to see our first movie at a theater in quite some time. Perhaps Saturday at 5:00 p.m. is not peak time, and perhaps there really aren’t too many quality movies out there right now, but the place was deserted. I counted five people in the theater. It is a decent, if slightly worn, facility that offers reclining seats, lots of legroom, and seat delivery of food and beverages.
A few things caught my attention. First, the price. For two people, tickets were nearly $40.00, without the requisite soda, popcorn, and candy. Second, the length of time spent watching advertisements seems to have gone up considerably, especially given the price. Third, and what provoked some thought on my part, was an advertisement promoting the use of their facilities for large corporate meetings, and even for multi-locational meetings.
Two of the main theater companies both offer their space for business meetings and events (Regal – https://www.regmovies.com/groups-and-events/meetings-and-events, AMC – https://www.amctheatres.com/meetings-and-events). Perhaps this is well known, but as AGS has no need for large facilities, it was certainly under my radar.
Since we like numbers, we thought we would look at movie attendance over the years. Movie tickets sold in the United States were highest just after World War II, peaking in 1946 when over 4 billion tickets were sold (Motion Picture Association of America). The low? Not surprisingly, 220 million tickets at the peak of COVID in 2020 – including Canada – and bounced back to about 820 million tickets in 2024 (Statistica).
But consider this, in 1946, the average person attended nearly 29 movies per year while in 2024, just over 2. This decline has been going on for decades because of technological changes that have given consumers an increasing number of alternative entertainment sources – first the adoption of black and white, then color, then cable television, the internet, and streaming services have been like waves crashing on a beach – and there may be more to come.
According to a Business Insider report (“The Theater Industry’s Next Crisis: Too Many Seats, Not Enough Movies”, Sept 12, 2022), seat occupancy averages between 15-20%. Even conservatively, the United States easily has twice as many theatres as necessary, and repurposing these spaces will become imperative if they are to survive.
While retail in general has rebounded from the COVID crisis, we seem to be in a never-ending cycle of bankruptcies and closures. There will always be a place for retail in the American consumer world, but we do believe that the nature of retail will have to change to once again thrive. In recent years, a considerable amount of retail space has been turned over to seasonal stores (e.g. Halloween and Christmas) and fitness clubs.
One of our local malls here in Thousand Oaks is about to undergo a major makeover. Its department store tenants are long gone, and the biggest draw is the fitness club, an afterschool gym program for children, and the restaurants which have sprung up around it. The future includes a hotel and high density housing in an attempt to bring additional traffic to the facility. We expect to see much more of this in coming years as traditional malls are downsized and some simply repurposed.
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