CineEurope: How AMC is "Premiumizing" the Moviegoing Experience in European Theaters
From plush new seats to booze, the theater chain is upgrading trips to the cinema.
When Europe's exhibitors gather in late June for the annual CineEurope trade show — where footage and screenings of the likes of Luc Besson's Valerian and the City of a Thousand Planets, the latest Planet of the Apes and Despicable Me 3 will be unveiled — there will be a new face among those jostling for studio goody bags at Barcelona's Centre Convencions Internacional.
In just one year, AMC Entertainment has landed with a significant amount of noise from across the Atlantic. The cinema giant — thanks to the deep pockets of new Chinese owner Wanda — completed its purchase of the U.K.-based pan-European Odeon & UCI Cinema group for $1.2 billion in November (taking advantage of the devalued, post-Brexit pound) and, two months later, spent $929 million for Scandinavian chain the Nordic Cinema Group.
The swift one-two punch of acquisitions makes AMC, by some distance, the biggest theater operator on the continent and a dominant player in Western Europe's competitive exhibition sector.
Its arrival comes at a challenging time. Last year Europe as a whole experienced its highest overall admissions since 2004 — up 1.6 percent in EU countries to 994 million (1.27 billion, including non-EU countries). But in the U.K., where AMC is now the No. 1 chain, and Germany, where it is No. 4, there were significant declines of more than 21 million ticket sales combined.
Rival operators therefore are likely to be paying close attention to AMC as it looks to buck this downturn by rapidly transferring a growth strategy it has pioneered at home. And that strategy begins with ripping up the seats — literally.
"In the next five years, they're going to have a quarter of Odeon screens fitted with reclining seats," says Pablo Carrera, principal analyst for cinema at IHS Markit. While such "reseating" obviously reduces each theater's overall capacity, stateside figures show the overhaul actually helped increase attendance by 47 percent, along with hiking the average ticket price by 7 percent. Many expect the move to have a similar impact in AMC's new territories.
"Moviegoers in Europe probably appreciate comfort just as much as moviegoers in the U.S., so I think what AMC is doing is a natural extension of their strategy in the U.S.," says Michael Pachter, managing director of equity research at Wedbush Securities.
But it's the speed with which AMC has exported its tactic of "premiumizing" — which also includes a focus on large-format screens and more upmarket concessions, including alcohol — that is likely to give the company crucial first-mover advantage in a market where other chains have only just begun to test the waters with theater renovations.
Says Karsten Grummitt of U.K.-based exhibition analyst Dodona Research: "You could say that the arrival of AMC will spark more urgency among its competitors. In Europe, the only way you can really significantly grow your business is by acquisition."
A CINEEUROPE HONOREE’S GUIDE TO BARCELONA
Despite being based in the capital of Madrid, Telecinco Cinema's head, Ghislain Barrios, is a Barcelona regular. With his 12-strong Telecinco family, he'll be making the journey again in June to accept CineEurope's international producer of the year honor.
"It's my favorite restaurant in Spain, not only in Barcelona," says Barrios of this modest yet much adored fish eatery (pictured) a few blocks from the conference hall. After discovering Els Pescadors about 25 years ago, the producer has returned again and again. "It's magical — not pretentious at all — and the food is superb." Try the "suquet" (fish stew), starting with the Galician clams. Dinner for two costs between $100 and $120. Plaça de Prim, 1
Although Barrios admits he's stayed in this luxury hotel only once ("when we go, we're on business and on a budget"), he says the experience has stuck with him: "I still have an incredible memory of the place. If you can afford it, I would recommend trying the Arts once in your life." A deluxe room during CineEurope starts at $445. And if money is no object, hit up the hotel's two-Michelin-starred Enoteca restaurant, which specializes in Mediterranean cuisine. Carrer de la Marina, 19-21
This story first appeared in the June 7 issue of The Hollywood Reporter magazine. To receive the magazine, click here to subscribe.