"Rewards" or similar programs in theaters

[Ryan Gallagher]

(If you find a genie in a bottle and get three wishes, you can't use a wish to wish for more wishes.)

And if you waste a wish on popcorn stamps your Genie or Djinn is gonna look at you like you are an idiot.

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[Marcel Birgelen]

I would just do it as a "Popcorn Club" promotion:

Every popcorn purchase earns a stamp... Small = 1 stamp. Medium = 2 stamps. Large = 3 stamps.
Every filled Popcorn Club card earns an "Upgrade" on your next purchase.
If you buy a small popcorn, 1 card gets you a medium. 2 cards bump you up to large.
If you buy a medium popcorn, it only takes one card to earn a large.
If you want a large popcorn three cards gets it for free.
If you BUY a large popcorn, presenting cards gets you a small, medium or large popcorn for free.
With a top-out limit of one free large for every large purchased. (Or three smalls or a medium and a small.)

Basically this... Every filled Popcorn Club card bumps you up one level.

One caveat: Cashed-in cards can't earn more stamps. If you present three cards to get a large popcorn for free, you don't get three more stamps. Stamps are only for things you buy. That way you can't use free popcorn to get more free popcorn.

(If you find a genie in a bottle and get three wishes, you can't use a wish to wish for more wishes.)

The point system was more as an illustration, I'm not even sure if it makes financial sense.

My thought experiment was more about how to entice people to come for a repeat visit. I'm of the belief that concession-based discounts probably will do very little to entice people to come back, while they still require a lot of overhead in administration.

On the other hand, I'm pretty sure that a free admission, will be more effective, even if both discounts would've the same economic value (e.g. $10), the perceived value of the free ticket will probably be much larger.

So, I'd say that a "Profiteer's Club" would probably be more successful than a "Popcorn Club", at least when it comes down to reach. If it would be financially successful would require more analysis.

[Scott Jentsch]

Another relevant question: Is there an advantage to getting customers to use a gift card over using a credit card? Either in transaction fees or in easing the friction of someone buying a ticket or in increasing concession sales?

If there is an advantage, tying the rewards program to a gift card/cash card like Mike was describing RTS' approach would yield some benefits.

If one $50 transaction with a credit card company is cheaper than five $10 transactions, that would save on processing fees. Plus, you now have $50 of their money, and it's an interest-free loan from the customer. In some situations, it may even be considered unsecured debt which does not survive a sale of the business or similar event.

If a customer having a gift card/cash card makes them feel like they've already spent the money, so then it's not like spending money again to see a movie, that could increase ticket sales. Likewise for concessions.

If a customer can give their kid a gift card to go to the movies, that may be advantageous for the theater in reduced cash handling and the kid will be likely to spend on concessions because it's not taking cash out of their pocket.

It all gets back to the costs of doing the program. If RTS makes it easy, there's a low labor cost and if they don't charge extra, there's no financial cost. If those costs are low enough, it's hard to see a downside. Unless you don't want to do it, and will fail because it's not a priority. That gets back to my original comment about doing something half-baked.

[Jack Ondracek]

Seems to me the importance of a reward program is going to be a balance of any perceived bottom-line or goodwill value against the time it would take to administer it.

Sure... RTS can manage the infrastructure, but, at least in my case, the time taken to run cards, issue points, punch or stamp cards (!!!), explain the program, etc etc would make my weekend lines even more unmanageable then they already are. So for me, it's like the top priorities would be (1); have you decided you really need to do this and (2); can your business handle the extra load that this will put on you, your staff and physical infrastructure? As habit-driven as people are these days, is a reward program enough to get people to notice and go to your place instead? How many popcorns and hot dogs could you have turned out while you're doinking around with the rewards program?

Full disclosure: I'm a drive-in... the only one for 75 miles around. I have a loyal customer base, as do the indoor houses around here. We perceive, maybe, about a 15% group that will travel between theatre types. Otherwise, they've got theirs, I've got mine and we all get along pretty well. Personally, I don't think a rewards program would do anything but make the long lines longer and explode the crabbiness quotient of newer customers, who think a drive-in should turn out decent food in the same 2-minute time frame they get at the McWindow.

When I was a kid, I remember the local skating rink would send me an annual postcard on my birthday, good for a free session, skate rental and a small drink at the concession. That, I did look forward to, though I don't think I ever brought anyone else in with me. Today, I couldn't imagine trying to do something like that. The owner's wife kept track of all the birthdays, filled out the postcards, paid for postage, hauled the weekly stack to the post office and made sure you were off the list when you turned 18. Goodwill, yep!.. Extra business? Doubtful. Did they really need it? Like me, they were the only one in town. It remains a nice memory, but I don't think it amounted to much more than that.