Why Does Theater Popcorn Cost So Much?
Are you getting ripped off at the movies?
July 25, 2008— -- Taking in a blockbuster movie this summer will cost you $12. But the small bucket of popcorn you enjoy while you're watching will cost around $5.50 — that's more per ounce than filet mignon.
University of California-Irvine professor Richard McKenzie wrote a book about popcorn — but even he doesn't know how much it actually costs to make.
"Those are trade secrets, nobody's going to allow me any access to their records simply because I may spill the beans," he said.
But, he's a professor, and figured out that it must cost less than 10 cents an ounce. Are movie goers really paying a whopping 1,300 percent mark up?
"Are they being exploited?" McKenzie asked. "If so, they're being exploited with some enthusiasm."
Everyone goes to the movies. And Americans eat more than a billion pounds of popcorn every year.
"No one is required when they enter the movie theater to buy concessions. We're happy when they do," said Patrick Corcoran of the National Association of Theatre Owners.
This is how movie theaters stay afloat.
"The theater can be paying 70 or more percent of the ticket price to the studios," said McKenzie.
That's because the studio makes the movie, pays the stars, and even pays for advertising the product. Once the movie-goer is lured in, he or she is easy prey to the popcorn.
"It is designed for the aroma to pervade the lobby," McKenzie said.
And the theatre owners keep 100 percent of the profit from the concession stand.
"Many theaters consider themselves in the concession business, not the movie business," said McKenzie.
They want to show good movies because then more popcorn eaters will show up and belly-up to the concession stand. And get this, sad movies boost sales. Scientists at Cornell University discovered that people watching "Love Story" ate 36 percent more popcorn than those watching "Sweet Home Alabama."
"You've got to understand that with that popcorn, you're helping to pay for the lights and the sound systems," McKenzie explained.
"Heating, lighting, air conditioning, the bulbs that are in the projectors take an awful lot of power," Corcoran said.
"If you didn't pay high prices for popcorn and other concessions, you'd be paying high prices for ticket prices," McKenzie said.
Can you cut your popcorn budget?
"You can in fact buy popcorn and smuggle it into the theatre and get the cost, get the amount of the tub down to $1.25," McKenzie suggested.
But then you'd look really cheap in front of your date.
"To me it's similar to the idea of someone bringing their own food to a restaurant. It's, sort of, a little unkind," Corcoran said.
But if you do buy the popcorn, McKenzie said to avoid the large tub in favor of a bag.
"You might think you're going to get more popcorn, and you can. But you might also get less popcorn simply because the sides of the bags are flexible while the side of the tub is not," McKenzie said.
The professor said he once received a medium bag containing eight ounces and a large tub containing just seven ounces.
"You don't want to buy the tub unless you're going to get refills," said McKenzie.
During his research McKenzie discovered that only 10 percent of people take advantage of the free refill offer on the tub. They're too embarrassed, perhaps, to go back for more once the movie has started.
This report was originally published on July 15, 2008.