«

»

Mar 25

Print this Post

Why Don’t Cinemas Assign Seating?

Unlike the rest of the world, nearly all cinemas in the US don’t assign seats. Movie-goers in other countries typically (i) reserve specific seats in advance or (ii) purchase their tickets (with seating assignments printed on them) for immediate use. Either way, the seats are assigned and not first-come, first-served. Not only is the American movie-going experience unique internationally, the experience is also inconsistent with American practices used for other spectator activities like sporting events, concerts, and, live theater.

There are several benefits that come with assigned seating, making the US non-adoption somewhat of a puzzle.

  1. Spectators can avoid long lines while still guaranteeing their desired seat.
  2. Cinemas can set prices to match the quality of the seats, charging higher rates for the better seats of popular movies, and lower rates for poorer, less-demanded seats. This “price-stratification” benefits consumers and the cinema. For consumers, they can guarantee their preferred seat (i.e. benefit #1 above). At the same time, the cinema can extract more revenues from those people desiring premium seats.
  3. Theater seating can be filled more efficiently with fewer one-seat gaps between groups of spectators. Seating allocation algorithms would initially create two-person gaps between audience members, which are later more easily filled by parties of 1 or 2 people.
  4. Incidents of “movie-hopping” / “double-dipping” are reduced.

Despite these benefits, why is it that cinemas in the US don’t practice assigned seating? I describe 5 alternative theories in roughly the order of least to most plausible, though none is entirely satisfying.

Theory #1: Americans prefer first-come, first-served for cultural reasons

Perhaps American cinemas differ from the rest of the world because Americans are culturally predisposed to select seating on a first-come, first-served basis. Non-assigned seating is arguably more egalitarian in that anyone committed to securing the best seat in the house can do so simply by waiting in line. The problem with this argument is that Americans don’t object to the non-egalitarian manner in which seating is assigned in other events and shows.

Theory #2: Lost movie hype created by long lines

Another argument might be that long lines of people waiting to go into a big blockbuster movie increase awareness and hype surrounding that movie, thereby attracting additional viewers. While there might be something to this explanation, the hype surrounding the movie must precede the long lines, otherwise no one would wait in line in the first place. Expansive advertising, Hollywood stars, well-known stories/franchises arguably create most of the hype surrounding a movie’s release. Long lines are a consequence of the hype, not a major cause of it.

Theory #3: Slower lines at the ticket window

Critics argue that when people at the ticket window spend extra time selecting their seats, lines to buy tickets would move slower. In other countries, however, this slowdown is avoided because the ticket clerk automatically selects the best available seats unless instructed otherwise. Moreover, the ability to reserve seats is likely to promote more online reservations, thereby reducing the number of people at the ticket window altogether. Most importantly, these considerations don’t factor in the time savings that come from avoiding lines to get good seats, which more than offsets any minor time loss experienced at the ticket window.

Theory #4: Lost advertising and concession revenue

When movie-goers must arrive early to ensure good seating, they are more likely to generate more revenue for the cinema in at least two ways: (i) they watch the pre-movie advertising, and (ii) they make purchases from concession stands. Even without lines, customers are induced to arrive earlier than necessary because the length of the previews is unpredictable.  Because total previews vary from 5 to 20 minutes in length, customers have to arrive on time if they want to guarantee that they won’t miss the beginning of the movie. Once there, customers will presumably still watch the advertisements/previews and buy concessions.

Theory #5: Enforcement costs outweigh price-stratification benefits

While most seating conflicts can be resolved without external involvement, assigned seating requires some degree of monitoring and enforcement performed by ushers. This service is at least marginally costly to the venue: more hours of labor are required. Enforcement is key to price-stratification (benefit #2 above). If spectators know that they can get away with purchasing a cheaper ticket and then moving to a better seat, they lack the incentive to purchase more expensive seats. Knowing this fact, cinemas must make a cost-benefit calculation that compares (i) the cost of employing more ushers/attendants with (ii) the additional revenues earned through price-stratification. In the case of highly expensive tickets (e.g. concert tickets, flights), the revenue increases from price-stratification is presumably large. Movie tickets, however, are relatively cheap, making the premium seating revenue relatively low.

In spite of its relative plausibility, the final theory doesn’t explain why nearly all other countries have adopted assigned seating. In countries with even more expensive labor than the United States (e.g. developed Europe), the cost-benefit calculation would suggest that even these countries’ cinemas should also leave seating unassigned.

Although each of these five explanations would require empirical testing, none of them is complete or entirely persuasive on theoretical grounds. The question remains puzzling. Perhaps, the US continues the non-assigned seating practice simply out of inertia.

About the author

Benjamin Bohr

Benjamin is a manager at Fulcrum Financial Inquiry. He specializes in statistics and data analysis for use in high-stakes litigation, business valuations, and other financial matters.

Permanent link to this article: http://betweenthenumbers.net/2013/03/why-dont-cinemas-assign-seating/

Leave a Reply

Your email address will not be published. Required fields are marked *

You may use these HTML tags and attributes: <a href="" title=""> <abbr title=""> <acronym title=""> <b> <blockquote cite=""> <cite> <code> <del datetime=""> <em> <i> <q cite=""> <s> <strike> <strong>


*