Value Propositions: Sizing up refillable popcorn tubs and drink cups

Snack Corner

In an era of expanding concession items, heartier menus remain one of the biggest challenges to convincing theatre patrons that concession snacks are a good value. One means of creating a value proposition is offering refillable vessels. Some cinemas chains have toyed with the idea of creating a value proposition of annual refillable vessels, such as popcorn tubs. Purchase the large bucket for a higher price and receive unlimited refills for the remaining calendar year. The question is: How do theatre operators make this work? Is the aim to build higher per-capita sales? Is the aim to create a loyalty program that invites patrons back to the concession stand for added value? Is the promotion aimed at making the consumer visit the concession stand working?

All of these considerations lead to the concept of value proposition. “I will spend more today, but my total concession purchases for the extended period of a year will be less” is the predominant viewpoint of the participants in these programs.

Many theatre owners offer a refillable vessel, whether it be for beverages or popcorn, as an incentive to buy into the snack options at the concession stand. Nearly all proprietors that use this system tend to add the combo effect to this application. The overall intent is to meet or exceed customers’ expectations about the theatre experience.

Some theatre circuits have implemented the ultimate value system by promoting the “annual popcorn tub purchase.” The customer is able to buy a popcorn tub at a higher price than a large popcorn and they get refills at a huge discount for the remaining visits throughout the year. Example: Purchase the 170-oz. large plastic vessel for $20 and get it refilled on any return visit for $2. In comparison, a typical 170-oz. tub might sell for $8 on a single visit. The patron may see the first purchase as “sticker shock,” yet they believe that as a regular moviegoer and popcorn connoisseur this will make sense and make for a real savings with multiple visits to the theatre.

Wally Helton, VP of merchandising and promotions for Cinemark USA, has extensive experience in this arena of value offerings and is considered by his peers an expert on the subject. “I started selling refillable popcorn containers and drink cups in 2000 at United Artists Theatre Circuit and have sold them at Cinemark since 2009,” he notes. “This was just an early version of a loyalty program. Once the guest buys the vessel at your theatre, they need to return to your theatre in order to use them. Then our guests enjoy a discounted price for the rest of the year.” This mechanism of refillable tubs serves a win/win proposition for guests and theatre operators.

Neely Schiefelbein, VP of sales at Cinema Scene, reports that the success of the refillable tub has led to many more circuits employing this strategy. “We’ve seen many customers adopt the refillable tub concept. Some do it with 85-ounce or 130-ounce, while others use larger sizes like the 170-ounce and 190-ounce. While it’s been done in many different ways—standalone purchase, paired with combos, etc.—it’s proven successful at many circuits across the country. People like the idea of saving money on return visits. And loyal customers will buy into this type of promotion knowing they will be back to their favorite theatre with the incentive of a deal!”

The theatre owner should proceed with caution, as there are outside complications to this promotion. First, after the initial sale of popcorn in what is typically a plastic tub, how sanitary is the vessel? Has the patron kept the tub in the trunk of their car and do they pull it out on their return visit to the theatre? Does the local health department require certain administration to insure sanitary conditions for repeat uses of the food vessels? While the idea of extra value by buying a refillable vessel has merit, is the theatre operator aware of the health risk that they will inherit when offering such promotions?

In similar conditions, theatre owners are offering a collector cup for beverages. In many cases, these cups highlight a particular franchise film or even the company brand. These vessels are great—they commit the patron to the brand. Sometimes the drink vessel has a long-term refillable option—i.e., all-year refills at one dollar, or sometimes free refills on the day of purchase. Here is the issue: What if the patron buys the specialty drink cup on Tuesday, then returns on Saturday with the same cup and asks for a “free refill” when in fact he/she did not purchase anything that day on that visit? How does the concession cashier know the difference? That is why some suggest a limited-time-only “collector cup” selling out after 100 hours of operation; this way, the concessionaires know the vessel was not sold on that particular day.

The other option that is emerging is the collectible popcorn tin. The graphics are incredible. The stability of a metal vessel is longer than the plastic competitor. The metal vessel also serves as a multi-use container for the purchaser after the consumption of the popcorn snack. Patrons can use the popcorn tins for their home use when popping microwave popcorn and watching TV sitcoms. The tins themselves are more expensive, yet theatre operators should understand this type of retail effect allows the movie lover to attach themselves to the franchise film. They can take ownership in the movie and it becomes a reminder of their movie experience, encouraging repeat visits to the cinema for more “take home” memories.

Larry Etter is senior VP at Malco Theatres and director of education at the National Association of Concessionaires.