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EMB Assignment One
AMC Theatres
Luis Pereira
October 29, 2023
John Multhauf, Entertainment Business Models
Why I chose this company:
I have loved movies for as long as I can remember, with one of my fondest childhood memories
being going with my parents to the movie theatres back in my home country every weekend. This
contributed to my passion for movie making, inspiring my career goal of becoming a film producer.
This passion helped me learn English, delve deeper into my creativity, and most importantly it
helped me better express myself and understand other perspectives. In conclusion, the movie
theater is one of the main influences that have shaped me into the person I am today.
Background Information:
AMC Theatres is an American chain of movie theatres founded in 1920 by the Dubinsky
brothers Barney, Maurice, and Edward. Initially known as Durwood Theatres, the brand changed
its name 40 years later, with a different approach to the business. The theatre chain, instead of
relying on large single-screen theatres, started inserting them into small buildings with several
auditoriums, creating the first multiplex cinema establishment. Over the years, they expanded the
business, focusing on innovating the movie experience and comfort of guests. AMC Theatres is
nowadays the largest movie theatre chain in the market, with more than 950 theatres and 10,500
screens spread around the world. The company is the main business line of the parent conglomerate
AMC Entertainment Holdings, Inc. The value of the franchise, according to financial data from
last year’s annual report to stockholders, can be as big as 10 billion dollars, with their revenue last
year being around 4 billion dollars alone (AMC Annual Report, 2022).
Customer Segments
• Men and Women from ages 18-34: Having to work with customer segments, especially
demographics, on a business as big as AMC Theatres is really challenging. The reason for that
is the customer segments include people of all ages, from children to seniors. However, using
data AMC provided when partnering up with advertisers, they mentioned: “Scale to reach one
out of every two 18-34-year-olds each year” (AMC Advertising, 2023). Therefore, we can
determine that the main customers of the business are both men and women from ages 18 to
34. From teenagers using the theatre for a date to couples bringing their children for a fun
weekend, the cinema theatre is known and used by a plethora of different people.
• Film Enthusiasts: Since we’re talking about a business that screens the art medium of movies,
the customers expected are the enthusiasts of films and the experience that surrounds them.
AMC Theatres provides a solution with top-notch technology used in the experience these
customers want.
• Advertisers/Sponsors: As previously mentioned, advertisers and sponsors seek partnerships
with movie theatres due to the extensive reach they possess.
Value Proposition
• Comfortable and authentic movie experience: AMC innovated the way customers watched
movies. Using cup holders in the arms of the chairs, adjustable armrests, reward programs for
the guest, IMAX screens, and Dolby sound, the business is all about offering the most
comfortable and authentic experience that customers will have when watching a movie
(SuccessStory, 2023).
• Online Engagement: AMC movie chains also have a website and a mobile app, providing a
platform for customers to browse showtimes, purchase tickets, and join virtual queues. This
enhances the overall convenience of the moviegoing experience. In addition to this online
engagement, AMC Theatres also established a partnership with VUDU, an online streaming
service, to stream movies that just left theatres. The latest movies include “The Super Mario
Bros Movie” (Adhikari, 2023).
Distribution Channels
• Physical Locations: Customers experience the cinematic marvels of AMC’s technology
through their movie theatre locations, with more than 500 spread all across America (Statista,
2023).
• Online: Customers, if not able to purchase the tickets in the location because perhaps they’re
late for the screening or don’t want to face lines, can also use AMC’s online platform -both
website and mobile app- to purchase tickets, reserve seats, and enter online queues for tickets.
AMC also partners with third-party platforms, such as Fandango, to sell reach to a much
broader audience.
• Loyalty Program: AMC Theaters offers their customers the opportunity to sign in as a member
of the business, with the program called AMC Stubs. The membership offers not only
discounts on food, beverages, and movie tickets but also reaches out to the customer with
promotions, therefore being considered a distribution channel as well (AMC Stubs Rewards).
• Social Media: To reach new customers and those who are inside social media, the movie theatre
chain utilizes their social accounts and email to advertise upcoming releases and promotions.
Customer Relationships
• Loyalty Program (AMC Stub): The AMC Stubs is a loyalty program that offers different
rewards within the cinema activities. Using the first tier of the program, which is for free, as
an example, you earn 20 points for every dollar spent at the box office. In addition, it includes
a complimentary popcorn refill every visit and a $5 dollar reward every time the member
reaches 5,000 points (Chavez, 2023). This tier alone allows the brand to build customer loyalty
by offering them extra incentives other than the movie experience, to continue visiting the
establishment.
• Customer Feedback: The business values what its consumers have to say about improvements
and issues they have. Therefore, the theatre chain is also present in social media in order to
understand the problems listed and come up with a solution that satisfies both the business and
the customers, providing a comfortable and clean environment.
• Events: AMC, like other businesses, also hosts events to engage with their consumers and fit
in promotions to expand their revenue and create a sense of “importance” on what they’re
showcasing. For instance, Taylor Swift’s concert movie ‘The Eras Tour’, received a premiere
in Los Angeles, attracting especially the artist fans, also known as Swifties, to the big screens
and expanding brand awareness (Lindsay, 2023).
Key Activities
• Film Exhibition: AMC Theatres' primary activity involves showing movies to customers. This
includes the operation of the plethora of screens, seating, and providing food and beverages,
all to maintain a high-quality viewing experience for customers.
• Marketing and Promotion: Intending to draw focus towards the brand, AMC Theatres promotes
movies and events through social media platforms such as Instagram and Twitter.
• Develop Partnerships: AMC Theatres also builds and maintains relationships with different
film studios and distributors to secure premieres, exclusive releases, and favorable terms for
showing movies. In addition, MAC also established partnerships with businesses in the
innovation and technology department to get access to technological advancements in movie
projection with IMAX and sound systems with Dolby, for instance (Bishop, 2015). AMC
Theatres also provides advertisers the chance to promote their brand to more the 385 million
annual moviegoers through Screenvision Media, which is a business specialized in cinema
advertising (AMC Advertising).
• Customer Service: The brand also provides excellent customer service, assisting customers
from ticket sales to ushering them to their seats. They are also present both remotely and in
person to resolve issues involving tickets, technical difficulties, lost and found, concession
issues, accessibility, and other inquiries and concerns (Contact AMC). All efforts in customer
service contribute not only to positive feedback from customers but also increase the chances
of brand loyalty and business growth.
Key Resources
• Physical Assets: The main resource of the brand are their physical assets. The theaters, the
seating, the screens, and any other properties associate to the brand- such as the ticket box
office or concession stand- are considered part of the vital resources and primary revenue
generators
• Intellectual Property: Being a business focused on film exhibition, one of the key resources is
the rights to content to movies, conceded by film studios and distributors. The rights to
intellectual property are also used by the brand to promote events such as premieres and ticket
sales discounts, using a certain movie or a character to attract costumers.
• Financial (Capital and Real Estate): AMC Theatres have a very strong resource in the market
which is capital and funding, used to invest in technologies and facilities. It is also used to
sustain business operations during challenging times, such as the COVID-19 pandemic in 2020
(Thorbecke, 2021). As facilities were mentioned, another financial resource from AMC is the
real estate. Real estate properties are being used by AMC in a more diverse way, such as leasing
out its properties for events, concerts, or even converting some locations into mixed-use spaces
that encompass entertainment, dining, and retail. This strategy allows them to adapt to
changing market demands and maximize the use of their real estate assets beyond traditional
movie screenings (AMC Annual Report, 2022).
• Strategic Partnerships: Collaborations with other companies are one of the key resources that
makes AMC Theatres stand out from others in the business. The partnership with IMAX,
where the technology company would sell the multi-million, innovative and dynamic screens
to AMC, which were renovating and upgrading their locations around the US with IMAX
screens, is a perfect example of a partnership as a resource to the business (BusinessWire,
2017).
Key Partners
• Film Studios: Film studios are key players in the entertainment industry, as they’re responsible
for the distribution and marketing of the films they produce to streaming platforms, stores, and
in this case to cinemas. Studios such as Universal, Walt Disney Studios, Warner Bros., and
Paramount are key partners to AMC Theatres as they are the ones that concede the business of
their content – in this case movies- to be consumed by audiences around the world. In addition
to securing access to movies for exhibition in theatres, the rights to intellectual property are
also used by the brand to promote discounts on tickets, and other events.
• Concession Suppliers: AMC Theatres also has partnerships with concession suppliers, as they
are the ones providing food and beverage products to be sold in the cinema facilities. One of
the biggest suppliers to AMC is Coca-Cola, which has partnered with AMC since 2015 to drive
more teen attendance and concession purchases (Coca-Cola Freestyle). The theater chain is
also expanding its business beyond film exhibitions and entering the popcorn industry,
establishing partnerships with businesses in the field to manufacture their exclusive “AMC
Perfectly Popcorn” (BusinessWire, 2021).
• Technology Providers: As previously mentioned, having partnerships with technology
companies is vital to AMC Theatre's success among consumers. The reason for that is they’re
able to acquire via a partnership with top-notch corporations, such as IMAX and Dolby,
immersive and innovative technologies which serve as a factor to consider watching a movie
at AMC rather than watching somewhere else.
• Marketing/Advertising Partners: Collaborations with advertising agencies for marketing
campaigns, promotions, and cross-promotional activities. These partnerships changed over
time. AMC often collaborates with movie studios for advertising tie-ins when promoting
specific films. They've also worked with various brands for sponsorships, such as Coca-Cola,
IMAX, and Dolby, to enhance the moviegoer experience.
Cost Structures
• Film Exhibition: Film exhibition costs constitute a significant portion of AMC Theatres'
expenses, involving payments to film studios and distributors. These expenses vary based on
the terms negotiated for each movie, encompassing revenue-sharing models or fixed fees. The
success of the box office and the popularity of specific movies directly impact these costs, as
high-demand blockbusters might come with higher exhibition fees, influencing overall
profitability. According to AMC’s 2022 Annual Report, film exhibition costs were a little over
$1 billion, approximately a fourth of the business’s total revenues (AMC Annual Report,
2022).
• Operational Expenses: Operational costs cover the day-to-day functioning of the theaters,
including utilities and maintenance. It includes expenses related to maintaining a comfortable
and safe environment for moviegoers, such as heating, cooling, and cleaning. The diverse
nature of operational costs can fluctuate based on the size and location of theaters, affecting
the overall financial health of each venue (AMC Annual Report, 2022).
• Employee Wages: Employee wages are a significant part of the cost structure, encompassing
salaries for various roles within the theaters, from ushers and ticket sellers to managerial staff.
The workforce size and composition, as well as local labor regulations and minimum wage
laws, significantly impact these costs. Staffing requirements might fluctuate seasonally or due
to the release of major movies, influencing the overall wage expenses.
• Taxes/Regulatory Costs: AMC Theatres must adhere to various tax regulations and local,
national, and industry-specific laws. Taxes, permits, and other regulatory compliance expenses
form a part of the cost structure. These costs cover corporate taxes, property taxes,
entertainment taxes, and compliance-related expenses.
• Marketing/Advertising: Marketing and advertising expenses cover promotional activities to
attract audiences to theaters. These costs involve advertising campaigns, promotional
materials, and partnerships. The fluctuation in these expenses might correlate with major
movie releases, seasonal trends, and specific promotional strategies. In 2021, for instance,
AMC Theatres spent around $25 Million in ad campaigns in order to attract people back to
movies (Rubin, 2021). The success of marketing efforts in drawing audiences to the theaters
significantly impacts these costs.
Revenue Streams
• Ticket Sales: The primary revenue stream of AMC Theatres is ticket sales of movies they’re
screening. Different types of tickets include the ones for standard screens, 3D sessions, IMAX,
etc. The business is also implementing ticket pricing based on where your seat is in the
auditorium. (Rubin, 2023).
• Membership Program (AMC Stub): AMC’s loyalty program, AMC Stubs, is one of the ways
they generate revenue. By offering rewards for those who go to movies often, the AMC Stubs
enhance customer loyalty.
• Advertising: As previously mentioned, the partnership with Screenvision Media helps AMC
organize the content to be advertised before a movie session starts. The revenue comes from
the companies paying Screenvision Media and AMC to advertise on their screens, selling
advertising space in theaters, and promotional tie-ins with studios or brands.
Conclusion
AMC Theatres, as a business entity, maintains a relatively robust model. Primarily, it has
established a significant presence as a leading movie exhibition company with a historical legacy
dating back decades. Theaters often act as more than just venues for the film; they become cultural
landmarks within communities, aligning with the notion of entertainment fostering emotional
connections. AMC crafts a sense of community around the cinematic experience, it's positioned
itself as a go-to entertainment choice for diverse demographics. AMC Theatres, as a leading movie
exhibition company, has faced a tumultuous period due to the COVID-19 pandemic. Analyzing its
business model, we can see that revenue sources for AMC primarily stem from ticket sales,
concessions, and advertising. However, the pandemic severely impacted these streams. Despite
the challenges, there have been strategic shifts in their business model, such as introducing
initiatives like AMC Stubs. In essence, AMC Theatres offers a robust investment prospect
grounded in community engagement and the shared delight of cinema. With strategic
improvements in branding and a redefined moviegoing experience, it stands poised to thrive in the
evolving landscape of entertainment preferences.
References:
Adhikari, S. (June 5, 2023 Monday) AMC Theaters On Demand moves its users and content
to Vudu. Newstex Blogs Android Headlines. https://advance-lexis-
com.oclc.fullsail.edu/api/document?collection=news&id=urn:contentItem:68D2-X2Y1-F03R-
N4PV-00000-00&context=1516831.
AMC Advertising. (2023). AMC Theatres.
https://www.amctheatres.com/business/advertise-in-theatres
AMC Annual Report (September 29, 2022). 2022 AMC Annual Report to Stockholders. AMC
Theatres. https://investor.amctheatres.com/financial-
performance/presentations/presentationdetails/2023/2022-AMC-Annual-Report-to-Stockholders-
/default.aspx
AMC Stubs Rewards (2023). AMC Theatres. https://www.amctheatres.com/amcstubs
Bishop, B. (2015, April 9). AMC and Dolby team up to make the laser-powered movie theaters of
the future. The Verge. https://www.theverge.com/2015/4/9/8373533/dolby-cinema-amc-prime-
movie-theater-laser-projector
BusinessWire. (2017, January, 2017). AMC theatres Expands IMAX Partnership to 175 Locations
by End of March, 2017. https://www.businesswire.com/news/home/20170119006207/en/AMC-
Theatres%C2%AE-Expands-IMAX-Partnership-to-175-Locations-by-End-of-March-2017
BussinessWire. (2021, November 04). AMC Entertainment to Expand Its Business Beyond
Theatrical Exhibition and Enter the Multi-Billion Dollar Popcorn Industry.
https://www.businesswire.com/news/home/20211104006280/en/
Chavez, B. (June 8, 2023). AMC Theaters’ loyalty program AMC Stubs offers rewards and perks.
Living on the Cheap. https://livingonthecheap.com/amc-theatres-loyalty-program-rewards/
Contact AMC. (n.d.). AMC Theatres. https://www.amctheatres.com/contact
Coca-Cola Freestyle. (n.d.). AMC Theatres. https://www.amctheatres.com/food-and-drink/coke-
freestyle
Lindsay, B. (September 28, 2023 Thursday). 'Taylor Swift: The Eras Tour' Locks LA Premiere
Event 2 Days Before Hitting AMC Theatres. Newstex Blogs The Wrap. https://advance-
lexiscom.oclc.fullsail.edu/api/document?collection=news&id=urn:contentItem:698K-7811-
JCMN-Y4N3-00000-00&context=1516831 .
Rubin, R. (2021, September 8). AMC Theatre Shells Out $25 Million for Ad Campaign to Get
People Back to the Movies. Variety. https://variety.com/2021/film/news/amc-campaign-back-to-
the-movies-1235058227/
Rubin, R. (2023, February 6). AMC Theatres to Change Movie Ticket Prices Based on Seat
Location. Variety. https://variety.com/2023/film/news/amc-theaters-movie-ticket-price-seat-
location-1235514262/
Statista (March 10, 2023). Number of screens operated by AMC Theatres worldwide from 2013 to
2022. https://www.statista.com/statistics/687617/amc-theatres-screens/
SuccessStory (2023). AMC Theatres SuccessStory. https://successstory.com/companies/amc-
theaters
Thorbecke, C. (2021, March 11). AMC reported loss of $4.5 billion in 2020 as pandemic clobbered
movie theater industry. ABC News. https://abcnews.go.com/Business/amc-reported-loss-45-
billion-2020-pandemic-clobbered/story?id=76387421

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Pereira_EBM_Assign3.docx1234123412341234

  • 1. EMB Assignment One AMC Theatres Luis Pereira October 29, 2023 John Multhauf, Entertainment Business Models
  • 2. Why I chose this company: I have loved movies for as long as I can remember, with one of my fondest childhood memories being going with my parents to the movie theatres back in my home country every weekend. This contributed to my passion for movie making, inspiring my career goal of becoming a film producer. This passion helped me learn English, delve deeper into my creativity, and most importantly it helped me better express myself and understand other perspectives. In conclusion, the movie theater is one of the main influences that have shaped me into the person I am today. Background Information: AMC Theatres is an American chain of movie theatres founded in 1920 by the Dubinsky brothers Barney, Maurice, and Edward. Initially known as Durwood Theatres, the brand changed its name 40 years later, with a different approach to the business. The theatre chain, instead of relying on large single-screen theatres, started inserting them into small buildings with several auditoriums, creating the first multiplex cinema establishment. Over the years, they expanded the business, focusing on innovating the movie experience and comfort of guests. AMC Theatres is nowadays the largest movie theatre chain in the market, with more than 950 theatres and 10,500 screens spread around the world. The company is the main business line of the parent conglomerate AMC Entertainment Holdings, Inc. The value of the franchise, according to financial data from last year’s annual report to stockholders, can be as big as 10 billion dollars, with their revenue last year being around 4 billion dollars alone (AMC Annual Report, 2022).
  • 3. Customer Segments • Men and Women from ages 18-34: Having to work with customer segments, especially demographics, on a business as big as AMC Theatres is really challenging. The reason for that is the customer segments include people of all ages, from children to seniors. However, using data AMC provided when partnering up with advertisers, they mentioned: “Scale to reach one out of every two 18-34-year-olds each year” (AMC Advertising, 2023). Therefore, we can determine that the main customers of the business are both men and women from ages 18 to 34. From teenagers using the theatre for a date to couples bringing their children for a fun weekend, the cinema theatre is known and used by a plethora of different people. • Film Enthusiasts: Since we’re talking about a business that screens the art medium of movies, the customers expected are the enthusiasts of films and the experience that surrounds them. AMC Theatres provides a solution with top-notch technology used in the experience these customers want. • Advertisers/Sponsors: As previously mentioned, advertisers and sponsors seek partnerships with movie theatres due to the extensive reach they possess. Value Proposition • Comfortable and authentic movie experience: AMC innovated the way customers watched movies. Using cup holders in the arms of the chairs, adjustable armrests, reward programs for the guest, IMAX screens, and Dolby sound, the business is all about offering the most comfortable and authentic experience that customers will have when watching a movie (SuccessStory, 2023).
  • 4. • Online Engagement: AMC movie chains also have a website and a mobile app, providing a platform for customers to browse showtimes, purchase tickets, and join virtual queues. This enhances the overall convenience of the moviegoing experience. In addition to this online engagement, AMC Theatres also established a partnership with VUDU, an online streaming service, to stream movies that just left theatres. The latest movies include “The Super Mario Bros Movie” (Adhikari, 2023). Distribution Channels • Physical Locations: Customers experience the cinematic marvels of AMC’s technology through their movie theatre locations, with more than 500 spread all across America (Statista, 2023). • Online: Customers, if not able to purchase the tickets in the location because perhaps they’re late for the screening or don’t want to face lines, can also use AMC’s online platform -both website and mobile app- to purchase tickets, reserve seats, and enter online queues for tickets. AMC also partners with third-party platforms, such as Fandango, to sell reach to a much broader audience. • Loyalty Program: AMC Theaters offers their customers the opportunity to sign in as a member of the business, with the program called AMC Stubs. The membership offers not only discounts on food, beverages, and movie tickets but also reaches out to the customer with promotions, therefore being considered a distribution channel as well (AMC Stubs Rewards). • Social Media: To reach new customers and those who are inside social media, the movie theatre chain utilizes their social accounts and email to advertise upcoming releases and promotions.
  • 5. Customer Relationships • Loyalty Program (AMC Stub): The AMC Stubs is a loyalty program that offers different rewards within the cinema activities. Using the first tier of the program, which is for free, as an example, you earn 20 points for every dollar spent at the box office. In addition, it includes a complimentary popcorn refill every visit and a $5 dollar reward every time the member reaches 5,000 points (Chavez, 2023). This tier alone allows the brand to build customer loyalty by offering them extra incentives other than the movie experience, to continue visiting the establishment. • Customer Feedback: The business values what its consumers have to say about improvements and issues they have. Therefore, the theatre chain is also present in social media in order to understand the problems listed and come up with a solution that satisfies both the business and the customers, providing a comfortable and clean environment. • Events: AMC, like other businesses, also hosts events to engage with their consumers and fit in promotions to expand their revenue and create a sense of “importance” on what they’re showcasing. For instance, Taylor Swift’s concert movie ‘The Eras Tour’, received a premiere in Los Angeles, attracting especially the artist fans, also known as Swifties, to the big screens and expanding brand awareness (Lindsay, 2023). Key Activities • Film Exhibition: AMC Theatres' primary activity involves showing movies to customers. This includes the operation of the plethora of screens, seating, and providing food and beverages, all to maintain a high-quality viewing experience for customers.
  • 6. • Marketing and Promotion: Intending to draw focus towards the brand, AMC Theatres promotes movies and events through social media platforms such as Instagram and Twitter. • Develop Partnerships: AMC Theatres also builds and maintains relationships with different film studios and distributors to secure premieres, exclusive releases, and favorable terms for showing movies. In addition, MAC also established partnerships with businesses in the innovation and technology department to get access to technological advancements in movie projection with IMAX and sound systems with Dolby, for instance (Bishop, 2015). AMC Theatres also provides advertisers the chance to promote their brand to more the 385 million annual moviegoers through Screenvision Media, which is a business specialized in cinema advertising (AMC Advertising). • Customer Service: The brand also provides excellent customer service, assisting customers from ticket sales to ushering them to their seats. They are also present both remotely and in person to resolve issues involving tickets, technical difficulties, lost and found, concession issues, accessibility, and other inquiries and concerns (Contact AMC). All efforts in customer service contribute not only to positive feedback from customers but also increase the chances of brand loyalty and business growth. Key Resources • Physical Assets: The main resource of the brand are their physical assets. The theaters, the seating, the screens, and any other properties associate to the brand- such as the ticket box office or concession stand- are considered part of the vital resources and primary revenue generators
  • 7. • Intellectual Property: Being a business focused on film exhibition, one of the key resources is the rights to content to movies, conceded by film studios and distributors. The rights to intellectual property are also used by the brand to promote events such as premieres and ticket sales discounts, using a certain movie or a character to attract costumers. • Financial (Capital and Real Estate): AMC Theatres have a very strong resource in the market which is capital and funding, used to invest in technologies and facilities. It is also used to sustain business operations during challenging times, such as the COVID-19 pandemic in 2020 (Thorbecke, 2021). As facilities were mentioned, another financial resource from AMC is the real estate. Real estate properties are being used by AMC in a more diverse way, such as leasing out its properties for events, concerts, or even converting some locations into mixed-use spaces that encompass entertainment, dining, and retail. This strategy allows them to adapt to changing market demands and maximize the use of their real estate assets beyond traditional movie screenings (AMC Annual Report, 2022). • Strategic Partnerships: Collaborations with other companies are one of the key resources that makes AMC Theatres stand out from others in the business. The partnership with IMAX, where the technology company would sell the multi-million, innovative and dynamic screens to AMC, which were renovating and upgrading their locations around the US with IMAX screens, is a perfect example of a partnership as a resource to the business (BusinessWire, 2017). Key Partners • Film Studios: Film studios are key players in the entertainment industry, as they’re responsible for the distribution and marketing of the films they produce to streaming platforms, stores, and
  • 8. in this case to cinemas. Studios such as Universal, Walt Disney Studios, Warner Bros., and Paramount are key partners to AMC Theatres as they are the ones that concede the business of their content – in this case movies- to be consumed by audiences around the world. In addition to securing access to movies for exhibition in theatres, the rights to intellectual property are also used by the brand to promote discounts on tickets, and other events. • Concession Suppliers: AMC Theatres also has partnerships with concession suppliers, as they are the ones providing food and beverage products to be sold in the cinema facilities. One of the biggest suppliers to AMC is Coca-Cola, which has partnered with AMC since 2015 to drive more teen attendance and concession purchases (Coca-Cola Freestyle). The theater chain is also expanding its business beyond film exhibitions and entering the popcorn industry, establishing partnerships with businesses in the field to manufacture their exclusive “AMC Perfectly Popcorn” (BusinessWire, 2021). • Technology Providers: As previously mentioned, having partnerships with technology companies is vital to AMC Theatre's success among consumers. The reason for that is they’re able to acquire via a partnership with top-notch corporations, such as IMAX and Dolby, immersive and innovative technologies which serve as a factor to consider watching a movie at AMC rather than watching somewhere else. • Marketing/Advertising Partners: Collaborations with advertising agencies for marketing campaigns, promotions, and cross-promotional activities. These partnerships changed over time. AMC often collaborates with movie studios for advertising tie-ins when promoting specific films. They've also worked with various brands for sponsorships, such as Coca-Cola, IMAX, and Dolby, to enhance the moviegoer experience.
  • 9. Cost Structures • Film Exhibition: Film exhibition costs constitute a significant portion of AMC Theatres' expenses, involving payments to film studios and distributors. These expenses vary based on the terms negotiated for each movie, encompassing revenue-sharing models or fixed fees. The success of the box office and the popularity of specific movies directly impact these costs, as high-demand blockbusters might come with higher exhibition fees, influencing overall profitability. According to AMC’s 2022 Annual Report, film exhibition costs were a little over $1 billion, approximately a fourth of the business’s total revenues (AMC Annual Report, 2022). • Operational Expenses: Operational costs cover the day-to-day functioning of the theaters, including utilities and maintenance. It includes expenses related to maintaining a comfortable and safe environment for moviegoers, such as heating, cooling, and cleaning. The diverse nature of operational costs can fluctuate based on the size and location of theaters, affecting the overall financial health of each venue (AMC Annual Report, 2022). • Employee Wages: Employee wages are a significant part of the cost structure, encompassing salaries for various roles within the theaters, from ushers and ticket sellers to managerial staff. The workforce size and composition, as well as local labor regulations and minimum wage laws, significantly impact these costs. Staffing requirements might fluctuate seasonally or due to the release of major movies, influencing the overall wage expenses. • Taxes/Regulatory Costs: AMC Theatres must adhere to various tax regulations and local, national, and industry-specific laws. Taxes, permits, and other regulatory compliance expenses form a part of the cost structure. These costs cover corporate taxes, property taxes, entertainment taxes, and compliance-related expenses.
  • 10. • Marketing/Advertising: Marketing and advertising expenses cover promotional activities to attract audiences to theaters. These costs involve advertising campaigns, promotional materials, and partnerships. The fluctuation in these expenses might correlate with major movie releases, seasonal trends, and specific promotional strategies. In 2021, for instance, AMC Theatres spent around $25 Million in ad campaigns in order to attract people back to movies (Rubin, 2021). The success of marketing efforts in drawing audiences to the theaters significantly impacts these costs. Revenue Streams • Ticket Sales: The primary revenue stream of AMC Theatres is ticket sales of movies they’re screening. Different types of tickets include the ones for standard screens, 3D sessions, IMAX, etc. The business is also implementing ticket pricing based on where your seat is in the auditorium. (Rubin, 2023). • Membership Program (AMC Stub): AMC’s loyalty program, AMC Stubs, is one of the ways they generate revenue. By offering rewards for those who go to movies often, the AMC Stubs enhance customer loyalty. • Advertising: As previously mentioned, the partnership with Screenvision Media helps AMC organize the content to be advertised before a movie session starts. The revenue comes from the companies paying Screenvision Media and AMC to advertise on their screens, selling advertising space in theaters, and promotional tie-ins with studios or brands.
  • 11. Conclusion AMC Theatres, as a business entity, maintains a relatively robust model. Primarily, it has established a significant presence as a leading movie exhibition company with a historical legacy dating back decades. Theaters often act as more than just venues for the film; they become cultural landmarks within communities, aligning with the notion of entertainment fostering emotional connections. AMC crafts a sense of community around the cinematic experience, it's positioned itself as a go-to entertainment choice for diverse demographics. AMC Theatres, as a leading movie exhibition company, has faced a tumultuous period due to the COVID-19 pandemic. Analyzing its business model, we can see that revenue sources for AMC primarily stem from ticket sales, concessions, and advertising. However, the pandemic severely impacted these streams. Despite the challenges, there have been strategic shifts in their business model, such as introducing initiatives like AMC Stubs. In essence, AMC Theatres offers a robust investment prospect grounded in community engagement and the shared delight of cinema. With strategic improvements in branding and a redefined moviegoing experience, it stands poised to thrive in the evolving landscape of entertainment preferences.
  • 12. References: Adhikari, S. (June 5, 2023 Monday) AMC Theaters On Demand moves its users and content to Vudu. Newstex Blogs Android Headlines. https://advance-lexis- com.oclc.fullsail.edu/api/document?collection=news&id=urn:contentItem:68D2-X2Y1-F03R- N4PV-00000-00&context=1516831. AMC Advertising. (2023). AMC Theatres. https://www.amctheatres.com/business/advertise-in-theatres AMC Annual Report (September 29, 2022). 2022 AMC Annual Report to Stockholders. AMC Theatres. https://investor.amctheatres.com/financial- performance/presentations/presentationdetails/2023/2022-AMC-Annual-Report-to-Stockholders- /default.aspx AMC Stubs Rewards (2023). AMC Theatres. https://www.amctheatres.com/amcstubs Bishop, B. (2015, April 9). AMC and Dolby team up to make the laser-powered movie theaters of the future. The Verge. https://www.theverge.com/2015/4/9/8373533/dolby-cinema-amc-prime- movie-theater-laser-projector
  • 13. BusinessWire. (2017, January, 2017). AMC theatres Expands IMAX Partnership to 175 Locations by End of March, 2017. https://www.businesswire.com/news/home/20170119006207/en/AMC- Theatres%C2%AE-Expands-IMAX-Partnership-to-175-Locations-by-End-of-March-2017 BussinessWire. (2021, November 04). AMC Entertainment to Expand Its Business Beyond Theatrical Exhibition and Enter the Multi-Billion Dollar Popcorn Industry. https://www.businesswire.com/news/home/20211104006280/en/ Chavez, B. (June 8, 2023). AMC Theaters’ loyalty program AMC Stubs offers rewards and perks. Living on the Cheap. https://livingonthecheap.com/amc-theatres-loyalty-program-rewards/ Contact AMC. (n.d.). AMC Theatres. https://www.amctheatres.com/contact Coca-Cola Freestyle. (n.d.). AMC Theatres. https://www.amctheatres.com/food-and-drink/coke- freestyle Lindsay, B. (September 28, 2023 Thursday). 'Taylor Swift: The Eras Tour' Locks LA Premiere Event 2 Days Before Hitting AMC Theatres. Newstex Blogs The Wrap. https://advance- lexiscom.oclc.fullsail.edu/api/document?collection=news&id=urn:contentItem:698K-7811- JCMN-Y4N3-00000-00&context=1516831 .
  • 14. Rubin, R. (2021, September 8). AMC Theatre Shells Out $25 Million for Ad Campaign to Get People Back to the Movies. Variety. https://variety.com/2021/film/news/amc-campaign-back-to- the-movies-1235058227/ Rubin, R. (2023, February 6). AMC Theatres to Change Movie Ticket Prices Based on Seat Location. Variety. https://variety.com/2023/film/news/amc-theaters-movie-ticket-price-seat- location-1235514262/ Statista (March 10, 2023). Number of screens operated by AMC Theatres worldwide from 2013 to 2022. https://www.statista.com/statistics/687617/amc-theatres-screens/ SuccessStory (2023). AMC Theatres SuccessStory. https://successstory.com/companies/amc- theaters Thorbecke, C. (2021, March 11). AMC reported loss of $4.5 billion in 2020 as pandemic clobbered movie theater industry. ABC News. https://abcnews.go.com/Business/amc-reported-loss-45- billion-2020-pandemic-clobbered/story?id=76387421