Societal Trends Leaving Movie Theatres Behind

The success of businesses within any given industry are greatly affecting by its macro environment. There are many aspect of macro environment. One way to analyze the macro environment is through a PEST analysis. A PEST analysis uncovers political, economic, social/ cultural, and technological trends that are outside of the control of any given company or industry.

General Atmosphere - Day 7 - 2011 Toronto International Film Festival

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A recent social trend favours movie streaming over theatre going. This social trend has negatively impacted the movie theatre industry greatly, with attendance falling 11% in 2013. Theatres are having difficulty attracting audiences, which obviously negatively impacts profits. Though the theatre industry cannot control social trends, individual companies can make efforts to increase theatre attendance.  Certain theatre companies in the industry have begun to attempt to create attractive points of difference to increase their sales. All movie theatre companies meet a point of parity of screening movies and selling snacks, but a point of difference is what makes the company stand out from the rest, what makes it more attractive than opponents.  Some attempts companies have made to make movie theatres more appealing and differentiated have been to screen old box office successes, employ 3D and 4D (includes sensory aspects) screening, have luxury reclining seats, have alcohol service and have meal service. Though these changes have slightly increased sales, in a declining industry there is only so much companies can do to save sales.


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