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The business model for movie theaters has been under threat since at least the 1980s with the widespread adoption of the VHS. DVDs, streaming, and the COVID-19 pandemic have only compounded the issue. According to Octane Seating, 63% of Americans watch movies at home, which isnt happy news for big chains such as AMC, Cinemark, and Regal. This is in addition to video games, smartphones, prestige TV, and every other form of media that competes for your attention in the 21st century. Popular movie chains have been forced to get creative to stay afloat. Tactics such as luxury reclining chairs and top-shelf alcohol havent been enough. A new controversial way to bring in needed revenue is to add additional non-trailer advertisements in the preshow, increasing the length from 1520 minutes to 30. So if you want to see a summer blockbuster flick, plan accordingly. Lets take a look at the timeline for this change and if it has impacted audience behavior. Cinemark and Regal lead the way In 2019, Cinemark and Regal reached an agreement with National CineMedia to add additional commercials in the preshow slot. One of these was dubbed a platinum spot and would play right before the attached trailers. The movie chains reportedly received 25% of the revenue collected from these prominently displayed ads. National CineMedia CEO Tom Lesinski promised that this would not deter audiences, as a similar practice was already standard in Europe. We dont believe it will be a significant issue for exhibitors or consumers, he explained in an interview with Deadline at the time. AMC jumps on the longer preshow bandwagon AMC initially rejected the idea, but six years later is changing its tune. On July 1, AMC joined Cinemark and Regal. The chain also made sure its patrons were aware of the change by emphasizing it in a disclaimer for ticket buyers. When news of AMCs change of policy broke, the movie chain issued a statement explaining the decision. AMC claims this change will not keep audiences away from theaters but doesnt explicitly say anything about watching trailers. While AMC was initially reluctant to bring this to our theatres, our competitors have fully participated for more than five years without any direct impact to their attendance, the statement explained. This is a strong indication that this NCM preshow initiative does not negatively influence moviegoing habits. How has this impacted the audience? While theater chains may claim the practice hasn’t impacted attendance, the timing of the COVID-19 pandemic and entertainment industry strikes make it difficult to isolate the exact reason for any changes in audience behavior. Thanks in part to the “Barbenheimer” phenomenon of two summers ago, 2023 was the best summer box office since all of this drama came about, bringing in $13.6 billion globally. Last year, meanwhile, saw a 10.3% decline domestically over 2023, according to Comscore. In June of this year, as reported by Deadline, Gower Street Analytics predicted the summer season would make around $12.4 billion in global box office revenue. Moviegoers appear to be holding steady. However, even though audiences are still showing up, they are starting to skip the trailers. According to Steve Bucks firm EntTelligence, only 60% of audiences were present for them this year. The numbers get lower in the movie-centric cities of Los Angeles and New York. Only 42% of Angelino cinephiles were present for every trailer, down from 55% last year. Only 42% of New Yorkers saw each trailer, down 5% from the previous year. These statistics to reveal a potential catch-22. While theater chains have to stay open to new sources of revenue, they may risk repeat business as fewer audience members are exposed to their full slate of coming attractions. What if a trailer plays in a movie theater and no one sees it? What good does it do? Tom Rothman, Sony Motion Pictures Group chairman and CEO, mused to Deadline. Its incredibly self-defeating and shortsighted. Since the beginning of the movie business, the single best inducement to see movies is trailers in movie theaters. And now, nobody sees them. Only questions remain. Will the skipping the trailers trend continue and even grow? Will this lead to opting out of going to the movie theater altogether? Time will tell. For now, be armed with the knowledge that you have extra time to get your popcorn without missing the movie should you so choose.
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E-Commerce
My dedication was questioned. Managers or upper management have looked down upon taking time off. People think that maybe youre not as invested in the job, that youre shirking your duties or something. These are just a few of the responses to questions I asked during a study I conducted on vacation guilt among American workers. More than 88% of full-time, private sector workers in the U.S. receive paid time off. This benefit is ostensibly in place to improve employee morale and well-being. Yet a 2024 Pew Research Center survey found that nearly half of American workers dont take all the vacation days theyve been allotted. And many of them feel as if theyre discouraged from using their time off. Ironically, whats supposed to be a source of relaxation and restoration morphs into a stressor: As vacations approach, feelings of doubt and guilt creep in. Im from Singapore. Upon moving to the U.S. in 2016, I was surprised at how pervasive vacation guilt appeared to be. Compared with many of the other countries where Ive lived or worked, American culture seems to prioritize mental health and wellness. I assumed these attitudes extended to the American workplace. Surprisingly, though, I noticed that many of my American friends felt guilty about taking time off that theyd earned. So as a scholar of tourism and hospitality, I wanted to understand how and why this happened. Vacation guilt To carry out the study, I collaborated with tourism scholar Robert Li. We interviewed 15 workers who had experienced feelings of guilt over taking time off. We also administered an online survey to 860 full-time employees who received paid time off from their employers. We wanted to know whether employees felt less respected or believed that their bosses and colleagues saw them in a worse light for taking time off. Maybe they feared being seen as slackers or, worse, replaceable. We found that 1 in 5 respondents to our survey experienced vacation guilt, and these concerns made them think twice about following through with their vacation plans. For those who eventually did take a vacation, they often tried to ease their guilt by going for fewer days. They might also apologize for taking a vacation or avoid talking about their vacation plans at work. Some of the people we interviewed had pushed through their hesitation and taken their vacation as planned. Yet all of these employees believed that theyd been penalized for taking time off and that it led to poor performance reviews, despite the fact that their paid vacation days had been a clearly articulated, earned benefit. The U.S. is an outlier The U.S. is the only advanced economy that doesnt legally mandate a minimum number of vacation days. On top of that, only a handful of states require workers to be compensated for their unused vacation days. Meanwhile, the law in other advanced economies entitles employees to a minimum amount of annual paid leave. The EU, for example, mandates at least 20 days per year on top of paid public holidays, such as Christmas and New Years Day, with a number of EU member countries requiring more than 20 days of paid vacation for full-time employees. Even in Japan, which is notorious for its workaholic culture, employees are entitled to a minimum of 10 days of paid leave every year. Throughout much of the U.S., whether paid vacation time is offered at all depends on an employers generosity, while many employees face a use-it-or-lose-it situation, meaning unused vacation days dont roll over from one year to the next. Of course, not all workers experience vacation guilt. Nonetheless, the guilt that so many workers do feel may be symbolic of broader issues: an unhealthy workplace culture, a toxic boss or a weak social safety net. For paid time off to serve its purpose, I think employers need to provide more than vacation days. They also need to have a supportive culture that readily encourages employees to use this benefit without having to worry about repercussions. Karen Tan is an assistant professor of tourism and hospitality management at Middle Tennessee State University. This article is republished from The Conversation under a Creative Commons license. Read the original article.
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E-Commerce
U.S. airlines doubled down on high-end travel after the pandemic to drive up profits and reduce their vulnerability to economic swings. The strategy is paying off as the margins of carriers selling premium seats have held up despite a slump in overall travel demand. Strong demand from affluent travelers is helping airlines offset a pullback in spending by price-sensitive customers. Delta Air Lines last week reported a 5% year-on-year jump in its second-quarter premium ticket revenue, compared to a 5% decline in main cabin revenue. The 10-percentage-point gap was the widest since the pandemic, helping it post a double-digit margin in the April-June quarter. Similarly, premium cabin revenue helped United Airlines mitigate the financial hit from operational constraints at Newark airport near New York City one of its largest hubs and increase its earnings in the latest quarter. United’s premium revenue rose 5.6% in the June quarter from a year ago. Its overall passenger revenue grew just 1.1%. The industry saw a similar trend in the first quarter when President Donald Trump’s sweeping tariffs raised the specter of an economic recession, hammering airline bookings. “Premium capacity remains resilient,” said United’s Chief Commercial Officer Andrew Nocella. Airline executives have attributed the resilient demand for premium travel to the healthy financial conditions of U.S. households with earnings of $100,000, which account for 75% of air travel spending. While an April selloff in financial markets after Trump announced tariffs raised the risk of undermining that demand, a sharp rebound in U.S. stocks since then has eased those concerns. “Our core consumer is in good shape and continues to prioritize travel,” Delta CEO Ed Bastian said last week. TROUBLE IN MAIN CABIN In contrast, lingering uncertainty about the broader economy and rising living costs have taken a toll on demand from less-affluent customers. Bank of America data shows, while spending by middle- and higher-income households held up in June, lower-income household spending turned negative. Low-fare carrier JetBlue Airways last month told staff that it was planning new cost-cutting measures as soft demand made achieving a breakeven operating margin in 2025 “unlikely,” according to an internal memo seen by Reuters. Summer travel season tends to be the most profitable for carriers. But weak demand for main cabin seats has forced airlines to offer sales to fill planes. Discount carriers such as Frontier and Spirit Airlines are aggressively slashing flights to prevent more discounting pressure. Airline executives say premium cabins have become “the profit differentiator” in the industry. Since premium travelers tend to be less price-sensitive, carriers expect them to be less affected by economic shifts, making their spending more stable and offering a buffer in a downturn. At Delta, premium revenue accounted for 43% of passenger revenue in the June quarter, up from 35% in 2019. It has helped the Atlanta-based carrier become a pre-tax margin leader post-pandemic. The company expects its revenue from premium cabins to surpass that from main cabins in 2027. Diversified revenues, including from premium cabins, have helped shares of Delta and United outperform the broader industry in the past two years. Encouraged by the payoff, carriers are further ramping up investments to make their premium offerings more attractive. United has unveiled new premium suites with privacy doors on its new Boeing 787-9 planes. The suites will have 27-inch screens, luxury skincare amenities, and caviar and wine pairings. Alaska Airlines is on track to increase the share of premium seats on its flights to 29% by next summer from 26% currently. RISK OF SUPPLY GLUT Faced with weak margins, budget airlines are now also trying to tap into the high-end market. JetBlue, which has reported a profit in just two of its last nine quarters, is putting first-class seats on domestic flights and opening its first airport lounges in New York and Boston. Frontier is retrofitting the first two rows of its aircraft with first-class seats. Spirit, long known for its no-frills service, is seeking to rebrand itself as a premium airline to turn around its business. The number of premium seats in the U.S. domestic market has increased by 14% since 2019, more than three times the growth in main cabin seats, according to data from Visual Approach Analytics. The rush to add premium seats is hampering aircraft deliveries. It also risks causing a supply glut, hurting pricing power. But Alaska CEO Ben Minicucci downplayed those concerns, saying premium travel is more about an experience than a seat. “We see it as an end-to-end premium experience that people will pay for and people expect,” Minicucci said in an interview. Rajesh Kumar Singh, Reuters
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