Our strategic objective is very straightforward: we intend to be the customer experience leader. (AMC Theatres)
As a customer, it really is fun when your expectations are completely blown away. That’s what happened when my Dad and I went to the movies last week.
You see, the Military Capital of the American Revolution has a new, state-of-the-art movie theatre complex. In early May, AMC Theatres completed a total transformation of its 40,000 square foot Headquarters Plaza 10 in Morristown, NJ.
Anyone who remembers the theatre under previous ownership will be pleasantly shocked. However, it seems to be mostly a secret. More on that in a moment.
Transformation Features Power Recliner Seats
The entire complex has been given a total makeover: new theatres, concession areas, bathrooms and lobby. The transformative highlight is the installation of comfortable, power recliner seats, in AMC red of course.
The recliners are configured in what AMC calls “platform seating,” in which each row is successively higher to facilitate clear sight lines (less angled than stadium seating).
The recliner seating is part of a national, multi-year comfort and convenience remodeling program for AMC Theatres. So far, they’ve been installed in about 11% of the chain’s locations. Starting in 2014, AMC will invest $600 million over five years on additional recliner seat conversions. (AMC 2013 10-K)
The technical upgrades in Morristown include new digital projection systems, 3D capabilities, screens, and a 7:1 speaker sound system.
“This is a game changer,” declared Dayon Saunders, General Manager at AMC in Morristown, referring to all the upgrades. “It’s the next era of movie and customer experience.”
AMC’s new movie-watching features are designed, in part, to address an evolving, competitive landscape that includes the proliferation of deluxe home theatres. AMC “mapped out the theatres to get the optimal sight and sound” for guests, explained Saunders. We “need to make people comfortable to go to the theatre,” he added.
Radical Thinking – Comfort vs. Quantity
The ten Morristown theatres range in size from 54 to 155 seats, with the largest also having a balcony.
As you might imagine, installing the comforts of home comes at a price: reduced seat capacity. In fact, the total number of seats was lowered 63% from 2,300 to 844 to create enhanced customer enjoyment. Take that, airlines.
And no, pricing has not gone through the roof. The max price for adult seats is $11.00, with various discounts for seniors, children and time of day.
The theatre experience upgrades are a conscious effort on AMC’s part to maximize customer enjoyment, which management believes will boost revenues:
“For an industry historically focused on quantity, this reduction in seating capacity [AMC’s typical recliner conversion reduces seating 64%] could be viewed as counter-intuitive and harmful to revenues. However, the quality improvement in the customer experience is driving, on average, a 80% increase in attendance at these locations.” (AMC 2013 10-K)
In Morristown, General Manager Saunders is “most excited to see the business evolve and grow because of this new design.”
Morristown Makeover Almost Didn’t Happen
Last summer, there was doubt whether Morristown would retain a movie theatre at all. The theatre closed in June 2013 after Bow Tie Cinemas acquired the location as part of its purchase of Clearview Cinemas, which was owned by Cablevision.
AMC reopened Headquarters Plaza in November 2013, but in its old, run-down condition. Construction occurred in a fast, 12-week period from early February through early May.
New Food and Beverage Options
For those coming hungry, dining options have been expanded for hot foods including mozzarella sticks, chicken tenders and sliders, french fries and pizza. You might think that would create hygiene headaches, but Saunders explained that the reduced seating actually makes cleaning easier.
To wash all the food down, AMC has added Coca-Cola Freestyle beverage machines to provide 100+ drink choices to customers.
System wide, beginning in 2014, AMC is investing $45 million annually for five years on food and beverage upgrades. (AMC 2013 10-K)
Other new features in Morristown include a reserved seating option during busy weekends, which can be accessed via Fandango and AMC’s own website.
During those times, on-site purchasers will select their seats via a small touch-screen monitor at the purchase counter or via nearby ticket purchase kiosks. That may take a customer break-in period and/or pose ticket speed-of-purchase challenges.
Saunders is confident the additional options will add to and not detract from the customer experience. He said reserved seating testing has only recently begun and expects it to proceed well.
AMC sees reserved seating as a supporting element to deliver on its customer experience promise:
“We believe that knowing there is a specifically chosen seat waiting for a show that promises to be a sellout is comforting to our customers, and removes anxiety around the experience. We believe reserved seating will become increasingly prevalent to the point of being a pre-requisite in the medium-term future.” (AMC 2013 10-K)
Quiet Marketing Communications Launch
AMC has taken a soft-launch approach with the upgraded theatre. It’s too soft in my opinion.
A sign touting the new seating experience was hung during construction (it’s still up) and a pair of actual recliners are on display in the lobby. Still, it’s not 100% clear what’s going on, and at best, that only addresses traffic walking through the overall plaza complex.
So far, in the first month, marketing to create awareness and knowledge of the new theatres has been limited to “word-of-mouth.” It’s been a slow build.
Saunders acknowledged that many guests have remarked they didn’t know about the massive theatre upgrade. I can attest, as my father and I had no idea what to expect. We just figured we’d find out.
Perhaps Memorial Day weekend visitors will help generate buzz in the community. But with such a great story, why leave it to chance?
If you upgrade, they will come. AMC Theatres is making customer experience the keystone of its go-to-market strategy. The entertainment company is investing $825 million, including power recliner seating, to dramatically enhance customer comfort and the total movie-going experience.
Harvey Chimoff is a hands-on marketing leader and business-wide collaborator who builds marketing capabilities in B2B/B2C organizations that drive customer success.