AMC Has The Dumbest Plan To Save Its Business
Movie theaters have had a tough few years, and with every new change, we've looked to AMC to see how they're handling it. When they closed down nationwide in 2020, that's when we knew this "pandemic" thing was serious (well, we guess all the deaths also offered a clue). When theaters reopened but production companies said they'd be streaming their films the same time as screening them, AMC boldly stepped forward and said they'd refuse to show such films at all, unless the companies worked out a better plan.
Then last year, things got very strange for AMC. The stock price, which had fallen to just $2, shot up to a high of $70. Many investors had been betting against AMC, since theaters were dying, and now other investors reasoned that if they could push the stock up a little, the first investors would be forced to buy back the shares they'd shorted, to avoid losing even more money, setting off a chain reaction. This worked for a little while, but AMC knew it wouldn't last. When they issued new stock, they actually warned all investors not to buy it unless they were prepared to lose all their money when the price crashed.
The price did crash, and AMC emerged with a little less debt but still in trouble long-term. People weren't going to the movies as much, and AMC needed new ways to make money if they wanted to stay in business. As you might know, a lot of a theater's money doesn't come from the ticket price, the majority of which goes to the distributor. The theater instead makes a bunch of money on concessions. So last year, AMC announced they'd be taking that popcorn that makes them so much money in the theater and selling it elsewhere too.
People do buy readymade popcorn to eat at home, when they're not popping it themselves. It's a growing market (unlike movie theaters), largely thanks to gourmet flavors. So, AMC could stand to make some money packaging popcorn for grocery stores or delivering it to people's homes. Before those plans, though, AMC started this popcorn selling program this year by opening dedicated popcorn retail outlets. They placed these popcorn takeaway restaurants in ... shopping malls. You know, the way of the future, the form of retail that's not struggling at all in the way theaters are—shopping malls!
Naturally, they only use malls that lack theaters selling popcorn of their own, but such malls without anchors are the ones that struggle most. The sight of a popcorn store in a mall, with no attached movie to watch, is a sad one indeed. AMC seems to believe wholeheartedly in this plan. For their new vice president of growth strategy, they grabbed someone with no specific experience with the movie industry. They picked someone who'd worked 10 years marketing for Hostess and Frito-Lay.
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Top image: Barb Watson