Value Chain In The Movie Industry

Movie industry consist of different types of firms throughout the product value chain.

This market includes: famous movie studios such as Walt Disney and Colombia pictures, independent production companies like Sony pictures entertainment and Warner Bros pictures, independent distributions such as 20th Century Fox, and major national exhibitions such as Cinemark and AMC. In the United States each part of value chain in the movie industry is separate and integration between distributor and exhibition is not allowed. “Vertical integration between distributors and exhibitors is prohibited under the 1948 United States v. Paramount Pictures decree.” (Wozniak, 2014). In the United States the distributor and exhibitors make a movie rental contract.

“Digital technology is expected to reach the traditional image quality. Powerful software enables the producer to use more special effects at lower cost and reduce the risks involved in the production of a film” (Casassus, Wei, 2010). 4.3.2.3 Marketing and Customer Service

Both Cinemark and AMC provide online services to enhance their marketing abilities to their customers such as using smartphone applications, which enable their customer to access to showtimes and tickets for any theatre in the United States and getting coupons and rewards.

“E-Service: Consumers have online access to any information related to a movie including show times, trailers, and tickets online. Moreover, The Internet also allows consumers to discuss the product online and guide them in their selection for a movie” (Casassus, Wei,

AMC tries to create a good experience for its customer through one of a king services which is different from their competitors. As AMC declares in is 2016 annual report, “our ongoing focus to improve the quality of the movie-going experience, legacy AMC theatres continue to maintain leading top-box customer satisfaction scores of greater than 60% and industry leading theatre productivity metrics” (AMC, 2016). Moreover, Customers not only have easy access to order tickets, but also, they can preorder food and beverages. AMC has updated many of their locations with a lounge and full-service bar called MacGuffins. “132 out of AMC’s current 346 US locations have a bar available, which means AMC has nearly as many MacGuffins as the Marvel Cinematic Universe. Here, adults can get alcoholic drinks and chill out before or after a film” (Ravenscraft, 2016). AMC also have free membership programs and let its members to earn points and use them for cheaper tickets and concessions as rewards. AMC’s Premiere program let its members to earn points five times faster if they pay $15 annually (Ellingson