New theaters go gourmet

October 30, 2008 7:45:37 PM PDT
When the AMC Studio 30 Fork & Screen opens Friday in suburban Kansas City, moviegoers will get to sample a lush life not normally associated with a megaplex. Most of the 30-screen complex still features popcorn, to be washed down with soda in theaters with masses of stadium seats. But 11 renovated and redesigned auditoriums offer - for a premium - padded recliners, alcoholic drinks and a full kitchen making Parmesan fries, Thai coconut chicken and Darkiccino chocolate brownies.

"This will be a great draw for customers who want an upscale experience," said Andy DiOrio, a spokesman for Kansas City-based AMC Entertainment Inc., which plans eventually to include elements of Fork & Screen in many of its more than 350 theaters.

So-called cinema eateries have been around for decades, but they've gained ground in recent years as theater operators look for new ways to attract customers, especially older moviegoers who have more money but less tolerance for the junk food, uncomfortable seating and rowdy teenage crowds that typically populate multiplexes.

In an industry that already makes around a quarter of its revenue and about 40 percent of its profits from food, giving customers an excuse to splurge more on treats and drinks is a hefty incentive to rip out the seats and go upscale.

The entrance of major chains, such as Regal Entertainment and AMC, the top two U.S. operators, will only broaden the appeal of such theaters, said Patrick Corcoran, a spokesman for the National Association of Theatre Owners. He estimates about 7 percent of theaters now offer an expanded menu.

Also Friday, Village Roadshow Gold Class Theaters will open a theater in Redmond, Wash., its second U.S. location, where the Australian company will command up to $35 per ticket for luxury leather seats and the chance to exchange the Jujubes for duck tacos, lobster rolls and expensive wine.

"One of the reasons I think you're seeing this is there's been an increase not just in the number of older adults but in the number of older adults going to movies," Corcoran said. "You want to get hold of that market. The older demographic tends to have more disposable income, (and) looks for maybe a different experience than what teenagers and people in their 20s are looking for."

Corcoran said while he was optimistic of the big chains' chances, they have to watch out for the pitfalls of the restaurant industry, where profit margins can be much smaller than the nearly 70 percent margins theaters see selling popcorn and soda.

"The only obstacle to it is now you have to do two businesses well," he said. "You not only have to do well with the presentation of the film, you have to do your food service well, and that's why they're doing it slowly."

AMC experimented with the Fork & Screen concept this summer at a theater in Atlanta but considers the opening at Studio 30, the company's flagship theater, as the best test of how consumers will embrace the idea.

"We feel we're on the right track with this step," DiOrio said.

The Fork & Screen is built around a central bar and lounge called MacGuffins. While ticket prices in eight of the 11 auditoriums are the same as in regular theaters, three are so-called "CineSuites" offering more intimate and comfortable seating and costing $10 extra.

All 11 auditoriums offer menu items ranging from $5.29 to $11.59 a plate plus beer and wine.

"It gives customers options," DiOrio said. "Dinner and a movie is one option. If you want to have a drink after the movie, we have that too."

Knoxville, Tenn.-based Regal, the nation's largest chain, has three Cinebarre cinema eateries that it operates jointly with a North Carolina-based entrepreneur who helped found the nine-theater Alamo Draft House chain in Texas.

CineBarre, like Alamo, offers menus heavy on sandwiches, appetizers and pasta, which are served on long tables that line each row of seats.

"These locations establish their own niche," said Regal spokesman Dick Westerling. "The one in Asheville (N.C.) has performed much better than the location that previously showed traditional movies in a traditional manner. We feel we're growing our customer base."

Village Roadshow's first location, in South Barrington, Ill., opened three weeks ago and offers movies in eight theaters built around a cozy foyer and bar.

Customers reserve seats online for one of the 40-person theaters staffed by servers in black suits. The menu leans toward the gourmet - Wagyu beef sliders, for example - with some dishes approaching $20 and a wine list including bottles costing hundreds of dollars. Tickets cost $22 to $32.

Kirk Senior, chief executive officer, said the price is high but not much more than seeing a movie and going to a restaurant afterward.

"We're finding it's not for everybody all of the time, but it's for everybody some of the time," Senior said. "We strongly believe we're not competing with the multiplexes."

Of course, all bets are off as the economy tanks, crimping Americans' leisure spending. But David Brain, whose Entertainment Properties Trust owns hundreds of theaters operated by chains like Regal and AMC, said cinema eateries can weather a tough economy if customers perceive they're getting a deal.

"If they pay even a dollar more but they get value for the time because they get to do what they want to do, which is have a meal and see a movie," Brain said, "I think people are going to be very satisfied with it."