Please provide 2 additional examples or citations to support your argument/ anal

Question

Please provide 2 additional examples or citations to support your argument/ analysis

Key success factors in the Movie Theater Industry

In today’s economy and society, the movie theater industry is suffering more than it ever has. “Revenues are up, but attendance is largely flat. The 1.4 billion tickets sold in 2007 is little improved from 1997, when 1.35 billion tickets were sold” (IBISWorld.com, 2017). The lack of growth in business comes because of unfavorable factors in the external environment, a lack experience provided by theaters, and entertainment alternatives. Some of these unfavorable factors include declining demographics, legal issues, and modern technology. Increases in technology have resulted in a lot of entertainment alternatives, such as Netflix and home theater systems, that are less expensive and more convenient for moviegoers and they are taking full advantage of it (Shuker, 2011). For the movie theater industry to be successful in today’s economy and society they need to improve the theater experience they provide to customers, differentiate themselves by providing a product that is rare and unique, and focus on their key success factors.

Key Success Factors

          The main key success factor in the movie theater industry is the theater experience. Wanting to see a movie without waiting for it to come out in stores is not the sole reason that people go to the movie theater. Some people use the movie theater as a date option or some other reason to just get out of the house. More importantly, people go for the overall experience that is provided by movie theaters. Although technology has resulted in high quality home entertainment systems, the experience of going to an actual movie theater remains more attractive to people (Thompson Jr, Strickland III & Gambl, 2008). This is because the movie theater experience is not just about the large screen and surround sound, but it also includes getting out of the house and enjoying a movie in a social setting with others.

            Another key success factor is that the movie theater industry is flexible and can adapt quickly to things such as modern technology. An example of this is the switch from 35-millimeter film to digital systems. The number of these new digital systems has expanded rapidly. “In 2004, there were under 100; by 2009, there were approximately 4,600, accounting for 12 percent of screens” (IBISWorld.com, 2017). This success factor directly relates back to the experience factor. The switch to the new digital systems will produce a higher-resolution image on the big screen which will enhance the experience for viewers.

The movie industry started focusing to upgrade by having marginal benefits and the key factors considered for the business success are such as trying out to serve full menus “in-theater dining” experience by seat-side service (Hoskisson, Hitt, Ireland & Harrison, 2012). Online seating reservation and more focus on wide seating arrangement, variable ticket pricing (may or may not include snacks or food pricing), new featured movie halls with ‘just right’ seating size with wonderful ambience and figuring out the best menu which may suit well when viewer views movie in the dark. Hence, executives look forward to having more benefits with higher food margins.

The movie industry is driven using technology in the movies and viewing experience that can only be enjoyed in the movie theatre. So, it is a success factor. For example, a movie like Jurassic Park can only be enjoyed in the movie theatres. Besides, the development of 3D and 4 D movies among the other technology also aids the industry. The second success factor is the differential pricing that should vary on a day basis as well as the time basis (Hoskisson et al., 2012). During day time and on weekdays, prices should be relatively lower and on weekends, the prices should be higher to cater the audience. The third success factor is the growing trend in consumer’s disposable income and increasing confidence in the overall economy, will also support the industry and more people will go the theaters.

Additional key success factors within the movie theater industry can be categorized under marketing related key success factors. According to Peteraf, Gamble and Thompson (2014) a well-known, as well as respected brand name, is an important KSF as it defines the influence the brand name plays in attracting and customers to the movie theaters. A well-known movie theaters and movies they show define their success. For instance, the ability of the movie theaters to market movies such as Black Panther that has attracted millions of customers across the globe identifies the power that the brand name plays on the success of the industry. Furthermore, courteous and personalized customer service is what the consumers seek (Peteraf et al., 2014). Today automated systems are used by most movie theaters to send consumers alerts on specific movies aligned to their preferences based on the history of the movie they have watched in the past. The personalized marketing approach is essential to communicating directly with the desired audience.

Skills and capability related key success factors are essential to the development and sustainability of the movie theater industry. For instance, the access to a talented workforce that is capable of providing superior services that best meet the needs of the customers is essential to developing customer relationships and loyalty (Peteraf et al., 2014). Additionally, product innovation capabilities such as the provision of a variety of snack foods for those visiting the movie theaters would be essential to attracting a greater number of consumers which translates to increased sales and revenue. Another key success factor under this category is the short delivery time capability which is referred to the time in which the customer has to queue in line for their tickets as well as the duration it takes to serve the customer snacks before they see their movie (Peteraf et al., 2014). The shorter the delivery time, the greater the customer satisfaction which is attributed to developing a large group of loyal customers.

Conclusion

The success factors of the movie theater industry are essential to understanding the areas of focus that organizational strategies can be developed around. The movie theater industry has been experiencing extensive challenges that have limited its growth and sustainability. The identification of key success factors is essential to shifting focus and energy towards these success factors with the objective of revitalizing the industry. The key success factors identified include technology, marketing related success factors, and skill and capacity related factors. The ability to leverage these key success factors would work to enhance the productivity and subsequent success of the movie theater industry.

References

Hoskisson, R. E., Hitt, M. A., Ireland, R. D., & Harrison, J. S. (2012). Competing for advantage. Cengage Learning.

IBISWorld.com. (2017). Movie Theaters-US Market Research Report. Retrieved from

https://www.ibisworld.com/industry-trends/market-research-reports/information/motion-picture-sound-recording-industries/movie-theaters.html

Peteraf, M., Gamble, J., & Thompson Jr, A. (2014). Essentials of strategic management: The quest for competitive advantage. McGraw-Hill Education.

Shuker, L.A.E. (2011). Double Feature: Dinner and a movie. Retrieved from https://www.wsj.com/articles/SB10001424052748703808704576062040285064856

Thompson Jr, A. A., Strickland III, A. J., & Gambl, J. E. (2008). Crafting &Executing Strategy: The Quest for Competitive Advantage. Business & Economics

Explanation / Answer

Key success factors of movie theatre industry:

References: http://www.dime-eu.org/files/active/0/WP46-IPR.pdf

https://courses.cit.cornell.edu/jl2545/4160/materials/Movies.pdf

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