Will AMC deliver blockbuster results in the popcorn aisle?

Discussion
Photo: AMC Entertainment Holdings, Inc.
Nov 11, 2021

AMC Entertainment, the largest movie theater chain in the U.S., announced plans to bring its AMC Theatres Perfectly Popcorn to retail.

The popcorn, served in theaters since 1920, will be available through four new platforms:

  • Owned retail: The company will open five “AMC Theatres Perfectly Popcorn” stores, counters and/or kiosks in shopping malls in the first half of 2022 and plans to have up to 15 by the end of 2022 and “significantly more” beyond. The initial locations are likely to be in malls without an AMC theater. Offerings will include traditional and gourmet-flavored popcorn, candy and soda.
  • Home delivery: AMC will make its “freshly popped” popcorn available for delivery from nearby theaters through food delivery-to-home services.
  • To-Go: “To Go” packages will be sold at theaters for takeout and/or pickup.
  • Third-party retail: in 2022, AMC’s prepackaged and ready-to-pop microwavable popcorn will begin hitting shelves in supermarkets and convenience stores.

AMC said in a statement that the non-theater popcorn push provides an opportunity to diversify and create new revenue streams.

“The announcement that AMC will become a competitor in the multi-billion popcorn market is so natural and logical, one wonders why the idea has not been tried before,” said Adam Aron, AMC’s chairman and CEO, in a statement.

He noted that AMC is the largest freshly popped popcorn provider in the U.S., popping in the range of 50 tons per day. He said, “With this new AMC initiative, we expect to reach entirely new segments of the U.S. population with our popular AMC Theatres Perfectly Popcorn.”

The launch comes as pandemic-wary consumers remain reluctant to return to cinemas and the home-entertaining threat from streaming services from Netflix, Hulu, Disney and Apple has accelerated. A Wall Street Journal article from early October said cinema owners are being forced to reimagine how their spaces are used and are experimenting with sporting event broadcasts and video game play.

The popcorn category is also experiencing a resurgence with the introduction of a variety of gourmet flavors and has become popular as a healthy, on-the-go snack, rich in vitamin B complex, antioxidants and fibers.

DISCUSSION QUESTIONS: Do you agree that it’s “natural and logical” to bring popcorn from AMC’s theaters to retail settings? Which of the four distribution options will likely be most successful? What advice would you have for the launch?

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Braintrust
"Popcorn at the movies tastes so good because it’s part of the overall theater experience. Will that magic translate to your home? Maybe. "

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15 Comments on "Will AMC deliver blockbuster results in the popcorn aisle?"


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Neil Saunders
BrainTrust

This is a good move by AMC, which can trade off its name and consumers’ love of authentic movie popcorn. However they are a little late to the party. Our local movie theater, Arizona-based Harkins, has been doing this for some time! You can order their popcorn for delivery, they have curbside pickup, and it is available through local Kroger (Fry’s) stores. It has proved to be a great way of generating a little revenue during a pandemic that battered movie theaters.

Suresh Chaganti
BrainTrust

Concessions drive huge amounts of revenue and margins for theater chains. Customers pay exorbitant prices not for quality, but because of time, place, and occasion. Hotdogs sell for $10 at a ball game. That doesn’t mean people will pay that much in a normal retail setting. I don’t recall the taste of AMC popcorn or how different it is from Regal popcorn or the discount theater popcorn in my city.

Sorry, but this doesn’t make sense. Given the low-risk launch profile, the damage may not be as much.

Georganne Bender
BrainTrust

Popcorn at the movies tastes so good because it’s part of the overall theater experience. Will that magic translate to your home? Maybe.

In Chicago we have a couple of popcorn brands with shops in malls and airports that are always busy. With that in mind an AMC kiosk at the mall, where the popcorn is served fresh, makes more sense than on the already over-saturated grocery aisles where it is just another brand.

The snacking situation at most malls isn’t that exciting. AMC is known for its popcorn, so why not give this a try?

David Spear
BrainTrust

Munching on theater popcorn while watching a movie at home will be delightful. I like this strategy and believe three of the four strategies will succeed. However “owned retail” will struggle for several reasons. First, mall traffic is waning and many retailers are moving out. Second, consumers are spending more time and dollars at “work-live-play” communities, where there are a variety of outdoor activities for retail, restaurants, dog parks, etc. If I were AMC, I’d seriously think about shifting the locations of my stores to these highly popular locations. Home delivery, to-go and shelf retail – IMHO – are home runs! I can’t wait to order and consume.

Gary Sankary
BrainTrust

I agree 100 percent with the statement that it is “natural and logical” to bring AMC branded popcorn to consumers in their home. Personally I believe in the long run that the grocery aisle will be the top channel for distribution. Microwave, I think, probably gives consumers the easiest access to the hot fresh popcorn they love from the theater. Enough so that there are a number of brands already selling “theater-style” products.

DeAnn Campbell
BrainTrust
This is a perfect example of “right idea, wrong time.” This concept would have worked well a decade ago — when movie theaters were more valued and popcorn and candy in high demand. Today it’s rare to see a movie theater at capacity except for the first days of a blockbuster action flick. Add to that the fact that Americans have a rapidly growing interest in healthier snacks, which further erodes the value of this offering, not to mention the vast array of competing products available today through any online or offline channel. However on the flip side, if they can take advantage of empty space to negotiate cheap or free temporary rent and selling products they already sell through their movie theaters, the cost of execution might be low enough that they could possibly break even. I’d rather see AMC develop their own movie streaming channel or work out a deal with Apple, Hulu, Netflix, and others to allow people to watch cherry-picked popular films or mini-series without having to subscribe to multiple streaming… Read more »
Liz Crawford
BrainTrust

Sad. Trying desperately to bring crowds back into the theaters. Good luck to them. Technology, fueled by the pandemic, has changed movie viewing and media consumption habits forever. Change or die.

Better would be to revamp the theater into a virtual reality experience – without the headset!

Meaghan Brophy
BrainTrust

Selling retail popcorn does seem like a natural and logical expansion for AMC. I think the third-party retail and owned retail arms will be most successful.

The smell of freshly popped popcorn can be hard to resist. Shoppers love a good mall pretzel – why not mall popcorn?

However I don’t see the to-go and delivery options being as successful. I’m not sure how well hot popcorn would travel.

Richard Hernandez
BrainTrust

We never thought Starbucks drinks would be in retail stores, so this is not a stretch either. I don’t know that the sale of popcorn will offset the beating that theaters have received during the pandemic but every little bit counts.

Jeff Sward
BrainTrust

This would have been great a couple of decades ago when I used to be able to dust a large bag by myself. Then one day I read just how much fat and salt I was actually eating. Oh, gulp. Also, there are a lot of delivered foods that can be reheated and thoroughly enjoyed. Ever tried to reheat popcorn? So even though my mouth is watering — for popcorn … in the morning … after breakfast — this is not sounding like a big business idea to me.

Steve Montgomery
BrainTrust

As Georganne stated, movie popcorn tastes so good because it is consumed at the theater watching a movie. Another reason is that some movie theaters keep their popcorn kernels in coconut oil and during the popping use Flavacol, which is a superfine salt that sticks to popcorn and has artificial flavor and Yellow #5 and #6 in it.

I stick to making mine the old-fashioned way with Orville Redenbacher white popcorn in a pan with a little oil and a lot of shaking.

Richard J. George, Ph.D.
BrainTrust

This is a good idea, although a little late and encumbered by the need to open and operate retail locations. Plus, supermarket shelves are already fully popped with options like Act II, Orville Redenbacher, Pop Secret, Jolly Time, etc.

Craig Sundstrom
Guest

No. None. Don’t. Good luck in proving me wrong, AMC!

Cathy Hotka
BrainTrust

Movie theaters took a huge hit during the pandemic, but creative ideas and new business models have saved most of them. Let’s hope that ideas like this can charm the public and ultimately bring everyone back to the movie house!

Rachelle King
BrainTrust

What fresh and innovative thinking coming from AMC. This is certainly one way to do retail transformation.

I suspect the Home Delivery option may be under valued. FAMILY movie night is not, even more so with the pandemic. Now, consumers can have the theater experience at home. If they can work out the economics of delivering popcorn, this one could surprise us.

Buying popcorn at the supermarket is a completely different experience vs movie theater. One purchase is a staple, the other, a splurge. Will need to see AMC retail pricing strategy to gauge success but this space might actually prove to be most challenging.

Success of the To-Go options may vary by market. In NYC where consumers may be walking home,To-Go or Take Out may not be as appealing as other markets like Chicago where consumers are likely driving.

Ultimately, these are all good options to generate additional revenue streams. Definitely worth watching.

wpDiscuz
Braintrust
"Popcorn at the movies tastes so good because it’s part of the overall theater experience. Will that magic translate to your home? Maybe. "

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