Higher Movie Ticket Prices, but Moviegoers Can Still Save
Superman may be faster than a speeding bullet and able to leap tall buildings in a single bound, but fans lining up for showings of "Man of Steel" over opening weekend are likely to discover he's powerless against rising movie prices.
A trip to the movies is getting more expensive. According to the National Association of Theatre Owners, the average ticket price in 2011(the latest figures available) was $7.93, up from $7.89 in 2010. Prices in large cities are even higher.
"There's a segment of the population that values going to the theater for that experience right after a movie is released, and those folks so far have been willing to pay," said Michael Corty, an industry analyst for Morningstar.
In May, Regal Entertainment Group CFO David Ownby said at a Barclays conference that the chain's prices for 2-D movies would likely rise 3 to 4 percent this year, as they have in recent years. At AMC Theaters, effective July 8, moviegoers redeeming discount ticket passes at select theaters in the Los Angeles area will pay an extra $2 "location surcharge." (AMC already tacks on a $1.50 surcharge for Manhattan redemptions.)
But experts say more of the higher cost per trip comes from theatergoers opting in for "premium viewing experiences." Theater upgrades to 3-D projection or bigger screens such as IMAX help justify higher prices, said Agata Kaczanowska, an entertainment research analyst for IBISWorld. Tickets to those showings can add up to $5 to prices.
There's also a trend toward luxe amenities including spacious leather seats that recline, and full dinner and bar menus that can be ordered from and delivered to your seat. Ticket prices for those locations can carry similar premiums, and may entice more spending on concessions, she said.
Higher costs come, in part, as consumers make fewer trips to the movies. Through June 10, the North American box office is down 6.3 percent compared to last year, according to BMO Capital Markets. Some of that can be attributed to factors like weather and movie selection (by this time last year, box office hit "The Avengers" had already been in theaters for a few weeks), said Tim Casey, an industry analyst with BMO Capital Markets.
The movie industry also continues to face competition from consumers who prefer to wait and watch on their own high-definition screen. "You don't have to go into a Best Buy to realize the in-home experience is getting better every year," Casey said.
That said, there's no reason for budget-minded consumers to stay home if they really want a night at the theater. There are plenty of tactics that can cut the cost of a ticket in half, or even drop it below the $1 mark:
Even with location surcharges, bulk passes can represent some of the best discounts around. Chains including AMC, Regal and Cinemark sell them on their sites, and packs can be found at warehouse clubs and online sellers such as BulkTix.com. Costco sells a 10-pack of AMC Gold Experience tickets for $85, or $8.50 apiece. At AMC Burbank 16—one of the theaters where the $2 surcharge will soon take effect—the final price for pass-users would still represent a 19 percent discount on the $13 adult ticket price.
Another new option for frequent moviegoers: MoviePass. For $30 to $35 per month, depending on the location, subscribers get one admission to a 2-D movie per day. (An earlier iteration available in 2011-12 used vouchers, which some theaters refused to accept. Co-founder Stacy Spikes says the service now uses a combination of a phone app and prepaid card, allowing members to buy a ticket at almost any theater accepting credit cards.) At that price, users break even after roughly three visits per month.
The catch: Users must sign up for an annual subscription,with prorated early-termination fees of up to $75 if they cancel after the first month. "After the year is up, it goes month to month and you can cancel at any time," Spikes said.
Memberships to loyalty programs in the entertainment sector, including those of movie theaters, rose 35 percent in 2012, to 30.5 million members, according to the 2013 Loyalty Census from research firm Colloquy. "One of the things they're all trying to do is capitalize on their loyalty programs," Casey said. As of this spring, members of Regal's free Crown Club get discounts of 50 cents to $1 off 3-D, RPX and IMAX movies at select locations in five states. The chain also now offers members discounted regular tickets on select days, as well as credits for each ticket that can be redeemed for free snacks or free admission.
Big chains may account for the bulk of theaters, but they're not movie fans' only option. Smaller chains and independents often have better pricing, although the movies may be lesser-known or older titles. At Starple xCinemas in Bakersfield, Calif., the matinee price is $1, rising to $1.50 after 6 p.m.—and 3-D showings are $2 more. June offerings include "The Croods" and"Oz the Great and Powerful."
There are also still hundreds of drive-in movie theaters, many of which price by the car or offer admission to double features. For example, Shankweiler's Drive-In Theatre in Orefield, Pa., 100 miles west of New York, charges $9 for adults and $5 for children. Its June 14-20 showings? "Man of Steel" and "The Internship."
Subscribers to daily-deal sites can often find half-priced deals for passes to chain movie theaters or special deals at local theaters. Sie FilmCenter in Denver recently offered a $50 package of two movie tickets, a bottle of wine and a large popcorn for $25 on LivingSocial.com, while in April Groupon had a deal for $7 tickets to "Disconnect." Across all the major sites, there are roughly 50 movie-related deals every month, although it's rarer to see deals from big-name, national chains, said Dan Hess, chief executive of online shopping aggregator DealRadar.com. "The majority of them tend to be for local, independently owned movie theaters," he said.
Banks, retailers and other companies often offer free tickets as a perk. Through Aug. 2, Visa Signature cardholders who buy two tickets to a Friday showing through Fandango.com will get the lower priced of those tickets free, up to $19.50. (Users can take advantage only once every 30 days.) Procter & Gamble has a mail-in rebate through the end of June good for two free tickets to "Monsters University" with the purchase of $25 in its products in one transaction.
—By CNBC.com's Kelli B. Grant. Follow her on Twitter @KelliGrant.