Shock! Horror! Firm in market economy uses market pricing

Odeon charges an extra £1 to see blockbusters: chain imposes surcharge on Hollywood movies including Interstellar as part of ‘dynamic pricing’ policy

Isn’t that just so shitty?

Pricing on supply and demand. Next thing you know they’ll abolish GOSPLAN.

25 thoughts on “Shock! Horror! Firm in market economy uses market pricing”

  1. Interestingly the Beeb covered this yesterday from completely the opposite angle (referred in the last sentence of the Mail report)

    http://m.bbc.co.uk/news/entertainment-arts-30094561

    It still doesn’t approach market pricing however. We took the toddler to see Planes 2 on a non school holiday afternoon just after it was released and paid the surcharge as a result. We were the only people in the screen.

  2. I’ve seen supermarkets charge more for Krug and Veuve Cliquot instead of Lambrusco too. Honestly, it’s an effing disgrace.

    As for 3-bed houses in nice suburbs costing more than one bed flats in Barking, don’t get me started.

  3. Embarrassingly for the Wail, their Saturday edition is 50% more expensive than their weekday one, and the Mail on Sunday is a whopping 250% more expensive!!

    Gougetastic!

  4. Let’s not forget books. Publishers issue an expensive hardback of best sellers and only release the paperback when the hardback market is tapped out.

    Even ebooks do it. They are more expensive on release than 6 months later.

  5. The ever excellent Planet Money did a program on this subject recently and it was quite revealing.

    http://www.npr.org/blogs/money/2014/07/11/330680385/episode-552-blockbusters-bombs-and-the-price-of-a-ticket

    Apparently the film makers don’t like blockbuster pricing because by default it implies, shock horror, that some films are crap. They have been known to withdraw films from some cinemas that discounted because they were implying that a film was crap.

  6. A cinema is a terrible place to see a movie anyway. If they released the movies simultaneously for home viewing, hardly anyone would go. Theatre makes sense. Live music makes sense. Cinemas don’t, not in a world of virtually free copying technology. The cinema arose because (a) copies of films were expensive to make and (b) so was the viewing technology (projector, screen etc). Neither now applies. They’re doomed, like broadcast television. A matter of when, not if.

  7. Better policy seems to be cheap days, full stop.

    All films cheaper on a Wednesday (or which ever day is worst attended). Seems to be happening on an occasional basis in Spain and apparently works.

    No film is shown to be crap.

  8. There’s no need for blockbuster pricing: most cinemas have a variety of room sizes: the blockbusters get the big screens, the indie flicks get the box room under the emergency staircase. Everyone is happy.

    Studios aren’t opposed to pricing by time. Many cinemas have lower prices before 5pm, lower prices on a Tuesday, etc.

    I’ve said it before, but all of Europe owes a debt of gratitude to Michael O’Leary for teaching us the benefits of dynamic pricing.

  9. Interestingly, in Bristol, the Odeon’s price to see Interstellar on a Saturday (£7.25 standard adult peak price + £1 blockbuster + £1.10 premier seat = £9.35) was exactly the same as the nearby Showcase Cinema de lux (where all seats are of “premier seat” or better comfort). For a nearly three hour film like Interstellar, those comfy seats are a must for me!

    So, given that Bristol city centre has a competitive market for cinemas, I look at it as the Odeon offering a discount for less popular movies to compensate for the fact that their seats aren’t as comfy. They do seem to take more care over the projection than the de Lux, and the staff seem to be passionate about movies, though.

    It’s the same story as the “parents protesting higher holiday prices in school holidays” thing a while back, really; most people don’t want fairness (whether enforced by the state, or through markets) they just want to have their cake and to eat it, all the time.

  10. Ian B,

    “A cinema is a terrible place to see a movie anyway. If they released the movies simultaneously for home viewing, hardly anyone would go.”

    I don’t think so because going to the cinema is more than just about going to see a film. If you ask a girl out, you might suggest seeing a film rather than suggesting watching a film round at yours on Blu-Ray.

    Personally, I much prefer cinema for certain sorts of film. Pacific Rim was great at the cinema, but it loses a lot on Blu-Ray. The Artist is just as good on DVD.

    (which is why cinema is full of blockbusters rather than Woody Allen and Terrence Malick films – hardly anyone goes to see those at the cinema).

  11. Ian B,

    “A cinema is a terrible place to see a movie anyway. If they released the movies simultaneously for home viewing, hardly anyone would go.”

    Not for 3D films…

    I saw Guardians of the Galaxy 3 times on IMAX 3D and it was the dogs bollocks.

    Even with my whizz bang home cinema system it is nowhere near the same at home…

  12. Ian B – Quite, with a 1080p projector for the price of a half decent TV, plugged in to a PS3/4 or PC and a budget set of speakers you are more than half way to the cinema experience and you have your own bathroom and kitchen to hand. Pays for itself in no time compared to the £30 per couple trip to the cinema.

    Once someone like Netflix moves wholeheartedly into the content production business all the middlemen are screwed.

  13. but they’ll then say that it’s somehow immoral to charge the same price for Hollywood blockbusters as British and art-house movies, which should be cheaper and so on and so on around the hamster-wheel of outrage

  14. @suelmoi – lol at that article suggesting £4 for a British film. i dare say that would be the last nail in the coffin lid.

  15. @IanB

    Leaving aside the potential for ‘the public’ to sully the experience by not obeying ‘the code’, the cinema is fantastic.

    It’s bigger, louder and much more immersive than watching at home. There are no distractions (which are optional at home, of course, your willpower may vary). It’s an ‘occasion’, even if you go twice a week (as I often do).

    I get why it’s not for everyone, but it won’t be killed off by better distribution channels… but Michael Bay not quitting the business soon enough could be an issue.

  16. Cinemas are painting themselves into a corner over this sort of thing.

    They should make the ‘blockbuster’ price the normal price and then advertise the other films as being “£1 off”.

  17. Bloke in Costa Rica

    TTG: no distractions? Maybe in your local cinema you’re allowed to embed a fire-axe in the head of anyone talking on their phone or kicking the back of your seat but unfortunately where I live we are afforded no such luxury.

  18. Bloke in Germany in Hong Kong

    Well, one man’s discount is another man’s surcharge.

    Apparently some airline wants $500 for me to fly tomorrow but sold a ticket for $50 to the guy who booked 6 months ago. Yet another disgrace of market pricing.

  19. Bloke in Germany in Hong Kong

    And what ever will they make of exclusivity pricing? Stuff that’s not even tangentially tangenting to the cost of production (as one would expect in a free market) but intentionally priced to keep the riff-raff out? Ferraris, Prada handbags, airport lounges, Swiss watches and so on? It’s just so not fair.

  20. I obviously don’t share The Mail’s usual absurd failure to grasp pricing, but I do wonder if Odeon have got this right. The whole point of blockbusters is that they are low-risk: that’s why the studios can spend such money on them. In other words, the reason they are profitable is that they pull large crowds. So a measure to reduce the size of the crowds (as a price increase will inevitably be) might be counterproductive.

    I think Cineworld have it right: £16.50 a month for unlimited viewings of everything. Not only is it a bargain, but it changes the way you see films, making you more likely to take a punt on something you’re not sure about and more willing to walk out if something’s obviously shite. From their point of view, they have a reliable guaranteed income stream even during patches of unpopular film releases, plus a handy contact list for promotions. They’ve been doing it since they were Virgin Cinemas, so it looks like it’s working well. Surprised Odeon aren’t copying it.

    I’ve been pretty lucky avoiding antisocial crowds at my local (West India Quay). I do try to avoid peak times, though.

  21. @BiCR

    You just have to choose your viewings. Most decent films will have decent audiences. Blockbusters attract all sorts, so unless you know it’s going to be big and loud enough to drown out the jabbering twats, wait a couple of weeks. And/or go to a late showing when all the twats are in the pub. Still, bring an axe just in case… it’s pretty dark and the credible witnesses will be on your side.

    Like Sq2, I’m a Cineworld unlimited guy. It’s great value and in 8 years of regular film-going I can only recall one that was ruined by others in the crowd.

  22. “I’ve been pretty lucky avoiding antisocial crowds at my local (West India Quay). I do try to avoid peak times, though.”

    That does seem to be the way to do it.

    I hear all sorts of stories about seat-kickers, texters, chatterers and other code of conduct violations, but I never get them, and I generally go on a weekday or weekend afternoons. I think the weekday crowd are people there to see a film, where the weekend evening crowd are kids who got kicked out with some money to give mum and dad some peace.

  23. > I think the weekday crowd are people there to see a film, where the weekend evening crowd are kids who got kicked out with some money to give mum and dad some peace.

    Yeah, spot on, I reckon. And as long as in you’re in a cinema with other people who want to see a film, the experience still beats watching at home hands-down.

    Jeffrey Katzenberg says he reckons Dreamworks will move to a model of worldwide simultaneous digital release three weeks after the cinema release. Sounds like a very good win-win plan to me.

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