Why the lackluster box office results? Americans simply aren't ready to return to the movies - Stockxpo - Grow more with Investors, Traders, Analyst and Research

Why the lackluster box office results? Americans simply aren’t ready to return to the movies

Moviegoers wear face masks in a screening hall at a cinema almost six months after its closure due to the coronavirus pandemic on July 24, 2020 in Beijing, China.

China News Service | China News Service | Getty Images

Even with more stringent sanitation policies, mask requirements and new air filtration systems, Americans aren’t racing out to cinemas.

Consumer reluctance to return to movie theaters has been reflected in less-than-stellar box office hauls and in weekly sentiment surveys from data companies like Morning Consult. 

“It seems that people want to see changes in the news with cases and policies,” Alyssa Meyers, brand and marketing reporter at data firm Morning Consult, said. “It’s not enough for places to just be reopening.”

Meyers publishes a weekly report detailing consumer sentiment about returning to a number of leisure activities, including going to the movies, returning to the gym and shopping at malls. For the last 12 weeks, public attitudes about these activities haven’t moved significantly, a warning that consumer habits are not returning to pre-pandemic normalcy.

The most recent survey, which captured responses from 2,200 people between Sept. 10 and Sept. 13, indicated that only 18% of consumers feel comfortable returning to cinemas.

At its highest, 23% of those surveyed said they would be willing to return to movie theaters. This dose of confidence occurred between June 9 and June 11 and appears to have been driven by reports that movie theaters were planning to reopen at the end of that month. Sentiment began to fall swiftly after reports surfaced that coronavirus cases in dozens of states had increased after Memorial Day.

This wave of infections, which was seen about two weeks after the holiday weekend, showed consumers that just because states were reopening, it didn’t mean that the virus was gone. In some cases, public health officials responded to the virus’ resurgence by rolling back or halting reopening measures. As a result, movie theaters didn’t begin widespread reopening until later in the summer. 

Last weekend, around 60% of U.S. movie theaters were open and new films were on the screen, but the domestic box office only reported around $15 million in ticket sales over the weekend, according to data provided by Comscore. For comparison, the same weekend in 2019 saw domestic ticket sales talying $112.8 million. 

“It doesn’t matter if theaters are reopened, it doesn’t impact customer confidence,” Meyers said.

Tim O’Connell, 31, a Virginia native that used to go to the movies with his wife three times a month before the pandemic, told CNBC that he doesn’t plan to return to cinemas until there is a vaccine or a significant drop in the number of cases in his area.

“I see people at the grocery store without masks and I know as soon as the theater goes dark a bunch of people will take their masks off,” he said. 

Like O’Connell, other potential moviegoers said that not being able to trust other people to follow mask policies or to stay home if they are sick is a big reason many aren’t willing to return to movie theaters.

That fear is having a big impact on the box office, particularly, Warner Bros.’ “Tenet.” In pre-covid times the Christopher Nolan film would have been expected to tally between $35 million and $55 million during its opening weekend, on par with other Nolan films like “Interstellar” and “Inception. Instead, it hauled in less than $10 million when it debuted over Labor Day weekend.

During its second weekend, the film generated around $6.7 million in ticket sales, a 29% drop from the week prior.

Of course, key markets like New York City and Los Angeles, where ticket prices are typically much higher, are not open. Additionally, the theaters that are open have a 30% to 50% cap on attendance. Still, even with the caps, movie theaters have not reported sold out showings or capacity issues. 

“While many are eager to return to some level of normalcy, there are still many more who we think will remain reluctant to attend the movies before there is a vaccine, or in the case that the transmission rate falls significantly before then,” Michael Pachter, analyst at Wedbush, wrote in a research note Monday.

“Simply stated, we do not expect attendance levels to begin to normalize until the end of the year at the earliest,” he said.

Internationally, where audience caps are similar, “Tenet” has garnered $177.5 million since the film opened in foreign markets three weeks ago. In the two weeks “Tenet” has been open in the U.S. and Canada, it has tallied just under $30 million.

“It just means what I’ve always believed,” Jeff Bock, senior analyst at Exhibitor Relations, said of the results. “Audiences aren’t ready to come back. And cinemas, unfortunately, will struggle to survive domestically.”

The tepid opening of “Tenet” lead Warner Bros. to push “Wonder Woman 1984” to December and has left a massive gap in the film calendar. Now, the next big-budget blockbuster is “Black Widow,” which doesn’t arrive until November. 


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