Why are movie theater snacks so expensive? on August 12, 2023 at 4:25 pm Business News | The Hill

(NEXSTAR) – Whether you’re going to the movies to love, cry, or care, as Nicole Kidman once said in her now-iconic advertising campaign, there’s a pretty good chance you’re also going for the popcorn and candy. The price tag on your snacks may make you cry, though. 

It’s a common gripe about movie theaters – the food and drinks are expensive. 

Take a box of Dots at Marcus Theatres, for example. They’re listed at $4.99 on the chain’s online ordering system. A box of Cookie Dough Bites at an AMC Theatres location in Chicago sells for $5.69 if you order online. The same boxes of either candy are listed as $1.24 at Walmart. 

A popcorn will run you anywhere between $7.65 and $10.29 between the two theaters. Meanwhile, you can buy a box of six bags of AMC Theatres branded microwave popcorn for less than $5 at Walmart. 

So why do movie theater concessions cost you so much? 

There are a number of factors that can influence the prices of candy, popcorn, and pickles (yes, pickles) at movie theaters. One of the most apparent is competition. 

Once you’re in the movie theater, your only option for food and drinks is the concessions or an on-site kitchen. Without anyone to compete with (besides smuggled snacks), the concession stand can charge whatever they’d like. 

There’s also inflation. We’ve all felt the weight of rising costs at grocery stores and restaurants. The same is true for movie theaters. 

During an earnings call in May, chairman and CEO Adam Aron said brand-name candy companies have been charging AMC up to 33% more for products in response to supply chain challenges, The Takeout reports. To combat the higher prices at the concession stands, AMC announced earlier it would be releasing its own candy to sell in its theaters.

Inflation has also impacted theater tickets, which can have an impact on concession costs.

Admission to movies (as well as theaters and concerts) is up 6% between June 2022 and June 2023, according to the Labor Department’s latest Consumer Price Index. Prices are up an average of almost $4.75 over the last 20 years. 

The fact that movie tickets haven’t skyrocketed since the early 2000s may be partially because of rising concession costs.

Previous research conducted by Stanford and the University of California Santa Cruz found that theaters tend to choose to raise concession prices over ticket fares. This means people that are trying to save money can still afford to come see a movie, and there’s an opportunity to collect a profit from them or others who can’t resist an ice-cold cola or a sweet Nerds rope. 

Researchers found that even when there were fewer movie-goers, concession sales were proportionately higher. 

“The fact that the people who show up only for good or popular movies consume a lot less popcorn means that the total they pay is substantially less than that of people who will come to see anything,” Wesley Hartmann, now a professor of marketing at the Stanford Graduate School of Business said. “If you want to bring more consumers into the market, you need to keep ticket prices lower to attract them.”

Some movie theatre executives even acknowledged the costs in the past. In 2008, then-CEO Mike Campbell told the Los Angeles Times that if concessions weren’t as expensive as they are, “tickets to the movies would cost $20” (tickets were about $7.20 at the time).

It’s hard to say how well concession prices have been keeping movie fares down. 

Through the first quarter of 2023, AMC Theatres reports $328.7 million in revenue from food and beverage sales alone, making up about one-third of its overall revenue. Marcus Theatres reported $59.7 million in theater concessions sales during the second quarter of 2023, again comprising about one-third of the business’s revenue.

Meanwhile, admissions comprised the majority of the revenue for both theaters – $543.1 million and $68.9 million, respectively. 

So can you sneak in your own food to beat the concession prices? 

As you may have guessed, AMC, Marcus, and many other theaters have rules against it. A local theater in your community may allow carry-ins, but you may want to check before you try sneaking in a box of Dots and a bottled soda.

​Business, News Unless you’re sneaking in food (which you really shouldn’t do), you’ll likely spend more on snacks than your actual ticket.