Why do American movie theaters now have assigned seats?

by on June 12, 2017 at 2:06 pm in Economics, Film | Permalink

Jeff Ely has a hypothesis:

Everyone who has armchair-theorized why movie theaters don’t sell assigned seats in advance is now obligated to explain why this has changed and how that’s consistent with their model.

I will start.  My theory was based on the value of advertising to movie-goers who must arrive early to get preferred seats and then are a captive audience.  This has become significantly less valuable now that said movie-goers can bring their own screens and be captive to some other advertiser.

1 Barclay June 12, 2017 at 2:22 pm

I have only seen assigned seats for venues where you can order food from menus and have delivered to seats (e.g. Alamo Drafthouse). My theory for why those have become more popular is because they are trying differentiate the experience against an increasingly high-quality, stay at home streaming experience.

2 FYI June 12, 2017 at 3:32 pm

Megaplex theaters does not deliver food to seats but they do sell assigned seats only.

3 Careless June 12, 2017 at 4:49 pm

The theaters here have done that in reverse: food delivery came after assigned seating

4 Mike W June 13, 2017 at 7:04 am

That’s my experience…and I’ve gone to the movies all over the country. Where do theaters other than those have assigned seating?

5 Jakob June 13, 2017 at 9:38 am

My local Cinemark theater has assigned seating (leather-ish and reclining as well) without a wait staff and overpriced entrees. I was under the impression that the Cinemark chain was moving in that direction as a whole, but that might be wrong.

6 Skip Intro June 13, 2017 at 12:49 pm

My local Cinemark (Southeastern US) has done this as well.

7 A Definite Beta Guy June 13, 2017 at 9:31 am

Almost all theaters by me have assigned seats now, and few actually bring food to you. A few got rid of that option, but will deliver food to the entrance of the theater (where you will pick it up).

Actually, I don’t remember the last theater I went to that did NOT have assigned seats.

8 Mike June 13, 2017 at 9:36 pm

Movie theaters in Asia have been selling tickets for all specific seats for many years. Despite this, theaters are consistently sold out, as they would be in the USA. Those who like to secure their preferred middle-middle seats just need to buy their tickets earlier, at no additional cost. System seems to work well. It’a about time cinema chains in the USA figure this out.

9 Jake June 12, 2017 at 2:27 pm

I’ve always thought it was because general admission is way easier for them to handle at the box office. Letting people choose their seats in person would require more staff manning the box office, so they didn’t do it. Now, it’s more efficient for the theaters to have people pre-order their seats online, so they are able to offer assigned seats at minimal cost to them, as well as push people to their online services, so the theaters do not have to pay as many employees to staff the box office.

10 zbicyclist June 13, 2017 at 11:25 am

So, the argument would be that pre-orders are more profitable for the theatre, (with the “convenience fee” and lower box office staffing), so they push in that direction. Getting your choice of seating is one way to push.

11 static June 12, 2017 at 2:28 pm

Previous theory- no way for people to select seats quickly. movie theater box office lines used to be very long.

New theory– The growth of the online ticket sale model made it easier technically to achieve

To Jeff Ely’s point, the “convenience fee” for printing your ticket at home (with your own computer, printer, paper, ink) may be earning back some of the advertising fees. The other big trend is the competition against ever larger screen size at home has led to many theaters offering luxury seats and guaranteed views (via reserved seats) to compete.

Of course, most of the world has had reserved seating for a long time. The other hold out has been France.
http://www.slate.com/articles/arts/culturebox/2013/08/movie_theater_seating_why_don_t_american_theaters_have_reserved_seating.html where first-come first-serve is considered more fair…

Along those lines will we start seeing differential pricing in the theater? Large reclining class seats in the best spots?
Small seats crammed in the back and front for those who don’t want to pay the premium? It seems unlikely we instead see differential pricing between theaters, with some offering luxury seating only.

12 Zach June 13, 2017 at 12:28 pm

In the UK, there are already differential prices in the theatre, precisely as you suggest! Comfy armchairs right in the middle that recline.

13 Meets June 12, 2017 at 2:44 pm

Well assigned seats are a better product.

You’re more likely to go to the theater if you know you’ll get a good seat.

14 Pshrnk June 12, 2017 at 2:50 pm

@Meets So why did it take so long for assigned seats?

15 kevin June 12, 2017 at 2:58 pm

Technology

16 meets June 12, 2017 at 3:56 pm

Yes, could be tech.

Reserved seats weren’t available until seats were available to be purchased on touch-screen kiosks or online (browser or app).

17 Careless June 12, 2017 at 4:51 pm

And for how many decades has this been a solved problem with sports and music events?

18 Meets June 12, 2017 at 5:43 pm

Maybe the solution prior to the new tech was too expensive for movie theaters?

Or maybe the hassle of choosing your seat in a similar way wasn’t worth it (slowed down the line too much).

Also the benefit to consumers is nice but not absolutely necessary, so they were less likely to care even though it’s a positive benefit. For sports and concerts, choosing your seat is essential.

19 Dick King June 12, 2017 at 9:13 pm

Sports and theatrical event tickets cost at least five times as much as movie tickets, and therefore the amount of money available to support an assigned seat infrastructure is greater.

20 Careless June 13, 2017 at 5:37 pm

You’ve never been to the cheap seats at a baseball game or a minor league game or a hockey game, huh dick

21 Alex Malone June 14, 2017 at 10:24 am

Except the norm for most music and most sport is general admin. It’s only at a certain price level where assigned seating comes in.

I’d say enforcement is an issue. Once you assign, you tacitly agree to enforce the rule against anyone who ignores it. For a high end event, you’re gonna have significant ushering/security anyway. Might as well add an extra job.

In Australia we have the weird situation where there’s assigned seating, but 40-50% of people ignore it in most cases. Creates a lot of anxiety.

22 Jan June 12, 2017 at 6:09 pm

Unless you’re in the back on the side.

23 Name June 13, 2017 at 10:03 am

Movie theatres sell almost all tickets to a session immediately before the session so there is a crunch. Sports and music events sell tickets over many days or weeks. No crunch.

24 kevin June 12, 2017 at 2:57 pm

Ignoring why it wasn’t always so–its incredibly more efficient (at least for a consumer) to look at a screen and know that there are, and where there are, sets of 4, 6, or more seats together then getting into the theater and trying to hunt down seats together, or trying to save seats if your parties late (there’s a seinfeld episode about this). I’d imagine this real world convenience can lead to more repeat customers over time. Plus you may be able to collect some of this surplus convenience in the form of online sales fees.

25 Jim June 12, 2017 at 3:10 pm

iPic theaters do have more expensive reclining seats and cheaper standard.

26 Stephen Jones June 12, 2017 at 3:11 pm

Most movie theaters in the US (excepting NYC) were designed to never be full. They would have a few hundred seats that maybe only 1 movie the opening weekend would be sold out. In this environment, there was never an incentive to sell specific seats as capacity was rarely reached. (What percentage of star wars films the second weekend would still be sold out). Most movie theaters are in a process of decreasing capacity while increasing the quality of the seats. AMC for example has remodeled most of its theaters to have fully reclining chairs. (my local regal has announced it will do the same 1.5 years ago. I’m still waiting). The decrease in capacity is roughly half or more. These theaters regularly sell out even in the third week simply because the capacity is so much smaller. As a consequence, theaters need a reservation system. The decrease in capacity is driven by the lower number of tickets on average due to competition from Netflix/60+” TVs and movies available online almost immediately after release (illegally). So, to sum, the basic model is driven by the optimal capacity. When everyone wants to show up and know they can see a movie with large demand, you want excess capacity. In a world with lower average demand, you want smaller screens with comfier seats.

Apps become important in this story as well as I can confirm in advance how busy a movie is going to be and which showing I will go to by buying my (capacity constrained) tickets further ahead of time. If I am going to my AMC which has big seats and low capacity, I don’t show up at the theater without having purchased tickets ahead of time. If I’m going to the regal, I’ll shoot to arrive at the first of four showings of Wonder Woman.

27 jim June 12, 2017 at 3:19 pm

Increasing land values also mean big empty theaters are less cost effective.

28 Hadur June 12, 2017 at 3:12 pm

This might be a naïve hypothesis: but what is this is simply what consumers want, and theaters are giving it to them?

We all hate going to the theater only to find there are not n seats together for our party of n. Live sporting events and concerts have had assigned seats for decades to alleviate this problem. Even restaurants with online reservations allow you to solve this problem.

29 Jim Morrison June 12, 2017 at 3:52 pm

You can not petition the lord. My project is this: we must cast lots and one shall die. I wanted an idol and tobias this idol with mine own image. To say that whales are cheap and aplenty in New York City.

“A hundred thousand other stranger’s eyes, apiece.”
Because you see, with all my wandering six times rehearsed six I had fought off their granddaughter – Lady Anne-grace-Eleanor- A saving grace, and so forth and so on by just an accident. It’s a long story, a romance a body might say. I’ll tell you all about it, but not now. There’s something happening here and I want to hear the whole story, every word. It’s a matter of precedence that couldn’t be settled. It refused to yield, everybody took a lady and processioned down I “seeing” this Adam and raising the conqueror, a “dearie”

30 Phil June 12, 2017 at 3:15 pm

Is this a big city thing that I’m blissfully unaware of?

I don’t think I’ve ever been to a movie theater with assigned seats, where do they have this?

31 jim June 12, 2017 at 3:27 pm

More support for the maximizing revenue per sq ft where land values are high (big cities)

32 Phil June 12, 2017 at 3:33 pm

makes sense

I guess that helps with the problem of people leaving space between themselves and strangers too

33 Careless June 12, 2017 at 4:58 pm

The first theater I went to that had this was actually in Sun Prairie Wisconsin, which, you’ll note, you haven’t heard of. It’s a new suburb of Madison carved out of farmland that didn’t exist 20 years ago (well, it existed, but no one lived there. Maybe one restaurant and one stop sign)

The other ones have all been in expensive regions around Chicago.

So damned if I know.

34 jim June 12, 2017 at 5:06 pm

I dunno bout Madison but in the Seattle area land values are rising everywhere in the region. There is cheap*er*, but there is no *cheap*.

35 Careless June 12, 2017 at 5:11 pm

Sun Prairie is still 4 beds/4 baths new construction $250,000 cheap.

Writing that out, I kind of want to move there.

36 A Definite Beta Guy June 13, 2017 at 9:36 am

Sounds like a mcmansion doomed to fall apart in a few years. What’s that, $100 or less per square foot?

37 jim June 13, 2017 at 12:36 pm

Wow, you’d be lucky to find that anywhere in WA state

38 Larry Siegel June 12, 2017 at 8:25 pm

Grr, the last time I was in Sun Prairie was more than 20 years ago.

39 Paul June 12, 2017 at 3:19 pm

In other many countries assigned seats have been the norm for a long time. Australia and Singapore for example.

Assigned seats certainly work better if the average group size is large.

40 Wes Bielinski June 12, 2017 at 3:29 pm

It also prevents people from going to multiple movies without paying.

41 FYI June 12, 2017 at 3:35 pm

Not really, since rooms are never full. By the way, I see quite a few cases where people decide to change their choice if the room is empty enough (if true owners show up these people just pretend they read the seat numbers incorrectly)

42 FYI June 12, 2017 at 3:38 pm

The simple answer is technology, as mentioned above. However, I also see a move towards fancier theaters and assigned seats match well that change in demographic. You will not find assigned seats at “dollar theaters” (which also seem to be increasing in numbers… it is the end of the middle class!)

43 Dain June 12, 2017 at 5:53 pm

Interesting, I NEVER see dollar theaters anymore. I remember one or two in the Sacramento suburbs. But since I’ve moved to the bay they’re nowhere to be found. Like drive-in theaters.

44 oblivia June 13, 2017 at 12:18 am

It’s nothing to do with technology. Assigned seats have always been the norm in the UK — and everywhere else I’ve lived. It’s an American oddity.

45 Thiago Ribeiro June 12, 2017 at 3:58 pm

Soon, only the rich and the powerfulful will be able to go to the movies.

46 Ray Lopez June 12, 2017 at 4:59 pm

I make my own movies. Once, I even starred in a porn movie, when I went to the O’Farrell Theatre in Frisco, or so it seemed from the audience participation (the lady in charge asked all the men to…well, it was a bit much for me and I actually left).

47 Careless June 12, 2017 at 5:00 pm

Fortunately, most of us here are Americans.

48 Thiago Ribeiro June 12, 2017 at 5:23 pm

American Middle Class is going the dinossaur’s way.

49 msgkings June 12, 2017 at 5:38 pm

If you mean getting gigantic, this is true

50 Thiago Ribeiro June 12, 2017 at 6:02 pm

No, extinct. American living standards are falling. Only the rich have made gains.

51 Larry Siegel June 12, 2017 at 8:27 pm

Fortunately, even Americans know not to go to the Mitchell Brothers O’Farrell Theatre. It is not your ordinary strip club or adult movie theater, but a very weird place with things going on that I would rather not know about.

52 Jeff R June 12, 2017 at 7:35 pm

Maybe that means Hollywood will start making some decent movies again.

53 Thiago Ribeiro June 12, 2017 at 7:40 pm

It will not, they are greed and want to appeal to Chinese audiences and comic books readers.

54 Careless June 13, 2017 at 5:44 pm

Check out the weekend numbers for The Mummy domestically and internationally. Complete flop here, somehow made a ton overseas.

Foreigners really love Cruise and Depp. Even when Americans mostly refuse to see their crappy movies they still do half a billion overseas.

55 Hadur June 12, 2017 at 4:11 pm

And BTW, my local movie theater (in Northern Virginia, near Tyler) does not have assigned seats yet. Or perhaps it does: I only see 2-3 movies a year in the theater and it’s possible my local theater adopted assigned seats months ago.

I’ll let you know in December when I see Star Wars, Episode 8. That’s probably the next time I’ll be in a physical movie theater.

56 Cooper June 12, 2017 at 4:17 pm

I’ve seen this pop up more and more here in San Francisco.

It’s wonderful!

Now I don’t have to worry about buying an expensive movie ticket only to be stuck in the front row.

If decent seats aren’t available for the movie that I want, I choose something else. It removes all the risk from moviegoing.

57 Chris Smith June 12, 2017 at 4:50 pm

Metadata.

58 Tom Hynes June 12, 2017 at 5:11 pm

Most events are assigned seats: live theater, pro sports. This was true pre technology.
Churches used to have assigned seats – a family paid for a pew.
With assigned seats, you could skip the opening act (or opening fights) and arrive for the headliner or main event.
All of this supports TC’s theory.

59 A different Phil June 12, 2017 at 5:16 pm

Assigned seats….that’s interesting.
I have not been to a movie theater in over a decade. Is popcorn still $100? Do people still talk incessantly and use their phones? Are the films still deafeningly loud with hackneyed story lines? When the theaters solve those problems, they might get my business back. An assigned seat is hardly enough.

60 Hoosier June 12, 2017 at 5:30 pm

Most of the Florida theaters I go to don’t have assigned seating. Neither do the ones in Michigan. Is there any estimates as to what percent of US theaters do this?

61 RM June 12, 2017 at 5:46 pm

Increased income inequality permits lots of things to happen, e.g., capturing more value from those willing to pay more for preferred seats or letting people signal that they are rich by being able to pay for preferred seats. (I imagine that their is some price discrimination).

If there is no price discrimination …. well, signalling that you can organize your life several weeks in advance for a new blockbuster is also a sign of relative wealth.

62 Ryan T June 12, 2017 at 6:01 pm

I first encountered this overseas, and it’s much better. You can look at where groups of people are clustered and avoid them. Also, you can avoid that awkward moment where you stand in front a crowd of people and try to find the gap in the crowd (and then avoid it).

63 A clockwork orange June 12, 2017 at 6:44 pm

If you could litter a train route with drive-by movie theaters with lawn chairs and under poplar trees, arcade games and funnel fare, I suppose the differential would require standing room areas in high density populated, popular cities. Granted rooftop films in suburban popular densities, such as Gowanus, where once an old dolphin died in the canal, in places the old american can factory are rooted in a steep and novel idea that combine with rooftop farms like Eagle Tree farms and underground parks like the Lowline. The idea is to preserve conservations of specious areas and turn them up for whatever purpose that purpose intervened for.

64 Miguel Madeira June 12, 2017 at 7:51 pm

All theories about “why movie theaters don’t sell assigned seats” are incomplete if they don’t explain why in Portugal movie theaters always had sold assigned seats.

65 Seth June 13, 2017 at 9:50 am

My guess is land prices. The US has twice the screens per million population as Portugal (http://screenville.blogspot.com/2009/09/screens-population-world-cinema-stats-5.html). Maybe Portuguese just don’t see movies all that often, or maybe they don’t have gobs of suburban farmland to convert to mega movie plexes. With less available capacity, they help ration it with assigned seating.

In the U.S., they solved the rationing problem by building gobs of capacity. Even now I don’t think reserved seating in the U.S. is a big norm because there is so much capacity. It’s typically just used in theaters that are trying to offer an enhanced experience along with fewer, more comfortable chairs, food and drink service and the ability to reserve a seat to save time and not have to come early to get a good one.

66 rayward June 12, 2017 at 8:29 pm

Even autonomous cars is about selling you something. https://www.nytimes.com/2017/06/09/technology/delphi-the-auto-parts-supplier-embarks-on-a-high-tech-overhaul.html It’s not about selling you a seat at the theater, it’s about selling you.

67 rayward June 12, 2017 at 8:46 pm

When I was a child we told “little moron” jokes. Like why did the little moron throw his clock out the window? He wanted to see time fly. Why did the little moron use Facebook? He wanted to share his life with his friends. Why did the little moron buy theater tickets online? So he wouldn’t have to stand in line.

68 hville June 12, 2017 at 8:32 pm

Here in Kulala Lumpur, assigned seats have been the norm for at least 20 years.

In many places, the front rows were sold at a good discount with the mid and back rows branded as “premium”

More recently, theaters encourage viewers to purchase tickets in advance.

69 A waco demolition called morrison June 12, 2017 at 8:45 pm

Lettuce not forget the tautology of lettuce heads. The great irony of programmatic advertising is that it is direct response marketing.

http://www.newyorker.com/magazine/2014/03/31/sacred-and-profane-4

F.B.I.: Kathy, perhaps we’re wasting each other’s time. All right? Put somebody else on.
K.S.: I mean, all you want, all you want to do is bargain?
F.B.I.: Kathy!
K.S.: Are you going to bargain with human lives?
F.B.I.: Kathy! I’ve told you what we’ll do and, and if that’s not agreeable to you, perhaps we’re wasting one another’s time. All right? . . . Why don’t you put somebody else on, please?
K.S.: Look . . . there are babies here that need the milk. Are you that inhumane that you can’t just send us the milk for not sending out kids, or sending out David, or sending out women?
F.B.I.: Our concern, our concern is for those children first and foremost and the rest of you also. All right? The children—
K.S.: So, your concern is that these babies get fed the milk they need?
F.B.I.: Kathy.
K.S.: It doesn’t sound like you are concerned.

70 A waco demolition called morrison June 12, 2017 at 8:48 pm

F.B.I.: Listen. I’ll, I’ll get the milk to you for two kids.

71 Todd K June 12, 2017 at 11:02 pm

I saw a movie in Indonesia in 1993. We got assigned seats – the back row since we showed up early, the people next in line sat immediately to our left, and so on so that the ones to show up last sat in the front war.

Lesson: dictatorships run efficient movie theaters.

72 Todd K June 12, 2017 at 11:04 pm

“front row” (a short bout of dyslexia)

73 Enrique June 12, 2017 at 11:45 pm

Does anyone actually sit in their assigned seat?

74 oblivia June 13, 2017 at 12:22 am

In the UK assigned seats have always been the norm — and also in Europe as far as I’m aware. Is there anywhere outside the US where this isn’t the case?

Perhaps the real question should be: Why has the US been so slow to adopt the worldwide practice of assigning seats at movie theatres?

75 Amigo June 13, 2017 at 1:03 am

Who can find their seat in the dark? And who is going to police it?

Southwest doesn’t have assigned seating either (unless things have changed recently).

76 Anonymous June 13, 2017 at 4:45 am

Instead of making up theories, more reliable information could be obtained by just asking someone who runs a movie theater. I don’t know any such people, but I was hoping someone here would.

77 Enrique June 13, 2017 at 6:20 am

But it’s easier for economists to “assume a can opener …”: https://en.m.wikipedia.org/wiki/Assume_a_can_opener

78 Steve June 13, 2017 at 6:58 am

I’ll take a wild shot as a non-economist: They make more money from reserved-seat ticket sales than they do from advertising.

79 Anonymous June 13, 2017 at 11:38 am

My theory — the fall-off from “intend to see” to “actually see” a movie has been growing with alternative entertainment options. As moviegoers in the US became more used to abandoning plans to see a movie, even advanced ticket sales have been insufficient for anything but the opening weekends. Specific seat selection encourages those who care to actually buy tickets when making original plans. This pre-commitment likely leads to more movie attendance overall. Cultures which have had that competition — from cafes, pubs, other venues — migrated to a pre-commitment model earlier.

80 Ben Kennedy June 13, 2017 at 12:16 pm

Assigned seats are a vastly better product – I will actually see movies on release weekend. It took a while because of infrastructure – web sites to handle the ordering, smart phones to display the ticket codes, and time for the existing theater infrastructure to decay to the point where remodeling to reserved seating made sense. In my 30 years of moviegoing, there has been a progression from “old” style seats you still see in artsy theatres, to “stadium seating” with movable armrests and cup holders, and now we are up to the recliner model

81 David Blakelock June 13, 2017 at 2:04 pm

1) More entertainment options meant that fewer people were willing to go to the movie if they didn’t know where they were sitting and after trying assigned seating in premium theaters the owners realized that there was demand for it and people would pay for it.
2) Technology has brought down the cost of assigning seats and delivering tickets electronically. 10 years ago it would have been a logistical nightmare.

82 Michael Donnelly June 14, 2017 at 1:24 pm

I suspect the true competition to the movie theater is watching at home which with 50 inch screens, streaming services, and comfort of home, the theater needs to continually improve, thus offer assigned seats, food, beer, leather seats etc.

PS our theater offers beer, wine, & full meals, but no assigned seating.

83 Enrique June 14, 2017 at 1:27 pm

On a related note: economists can’t even give a convincing answer as to why popcorn costs so much more at movie theaters. Eric Helland, for example, once told me that it was because of “clean up costs.”

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