Telephone ticket sales help movie theaters set records and fill seats

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Author: Steve Ginsberg
Date: Dec. 7, 1992
From: Los Angeles Business Journal(Vol. 14, Issue 49)
Publisher: CBJ, L.P.
Document Type: Article
Length: 859 words

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A major Hollywood marketing trend is emerging this robust 1992 holiday Hollywood box office season with telephone movie ticketing being partially credited for luring more people into theaters.

Thanksgiving weekend receipts of $133 million shattered the old record set in 1990 by $22 million. Calls to MovieFone, the leading telephone ticket service, doubled to more than 600,000 Thanksgiving week, compared to 300,000 calls in the same period last year.

During the last two weeks of November, MovieFone sold 140,000 tickets in 10 cities nationally with much of the action here and in New York, according to Andrew Jarecki, managing director of the company headquartered on Sunset Boulevard. In Los Angeles there were 125,000 calls to MovieFone Thanksgiving week.

At Mann's Chinese Theater all seats for performances of "Dracula" were presold via telephone for the Friday Nov. 27 performances and there have been other sellouts for other popular films at theaters such as AMC's 14-screen theater at Century City.

In New York, 70,000 "Dracula" tickets were gobbled up over the phone in the film's first six days.

Jarecki said he is hoping MovieFone will account for 5 to 10 percent of all movie ticket sales in its 10 markets this holiday season, but theater executives see it as generating much bigger business over the next five years.

Tim Warner, president of the National Association of Theater Owners, said he "wouldn't be surprised that in the large metropolitan areas that 25 to 40 percent of movie tickets will be sold via telephone. The system works because it's convenient and assures you of getting a seat."

The marketing hook for the movie-phone marriage is obvious. Aging baby boomers don't like waiting in movie lines or playing roulette with their Friday and Saturday nights. They want to be assured of tickets before they go to a theater and apparently don't mind spending an extra $1 per ticket for the MovieFone service charge.

Theater owners are hopeful that many former moviegoers who have become part of the couch potato video generation will now come back to their multiplexes because of the convenience of teleticketing.

MovieFone has been in business for three years and chains such as AMC have used the service.

However, this holiday season is the first time the service has been aggressively marketed in a $500,000 advertising campaign that included billboards and full-page ads in the Los Angeles and New York Times featured three films "Dracula," "Aladdin" and "A Few Good Men."

For three years the Los Angeles Times refused to carry MovieFone's ads because it perceived the service as competition, but this year it changed its policy and took the ads in October, Jarecki said.

He said new executives in the Times' advertising department who "saw technology as a friend, not a foe" were responsible for the change in attitude.

Sony Pictures Entertainment and Buena Vista Pictures Distribution were the first studios to embrace the system. After ads touting those studios' films, other major studios now want to jump on the wagon, Jarecki said.

Teleticketing has several major benefits for the studios, he said.

Typically, heavily hyped films sell out quickly and studios lose business when patrons go to competitors' movies as second choice option. The telephone system allows the moviegoer to shop for the film and buy, increasing the chances of seeing it.

With the advance reservation system, studios will know several days before a film opens how big an opening to expect and can adjust marketing plans accordingly. Currently, studio executives must wait until Friday night opening box office receipts are tabulated before they know what to expect from the movie's run.

The studios pay to have their films hyped on MovieFone's phone message, which uses President Russ Leatherman's voice. That advertising is a major revenue source for MovieFone, where profits are not expected for at least another five years.

After callers make their phone reservations for the desired movie and locale, they give their credit card numbers. At the theaters, they insert their credit cards in ticket-dispensing machines and the tickets are spit out. These patrons then proceed into the theater without going to the back of the line.

The company itself gets about 30 cents a ticket but from that must pay for the ticket-dispensing machines at theaters. At the 18-screen Cineplex Odeon at Universal City, it cost MovieFone $40,000 for the machines and installation.

Some theaters have reserved upwards of 30 percent of their seating for the phone-ins in a preferred seating area. In New York, some Loew's theaters have a concierge in their lobbies to deal with customers.

MovieFone is starting to have competition.

Ticketmaster Inc., the Los Angeles-based ticket vendor with $1 billion in annual sales, is testing its movie service with 11 General Cinema outlets in Los Angeles.

That service is three-tiered, allowing customers to buy tickets at Ticketmaster outlets for an extra $1.50. For a $2 service charge, callers can order tickets from a live operator. Callers can also pick up tickets at the box office.

Fred Rosen, chairman and chief executive officer of Ticketmaster, said he hopes to eventually get 1 percent of all the movie ticket business in the U.S.

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