In a model similar to those being adopted at sports stadiums and arenas across the country, Regal cinemas announced on Tuesday plans to test incremental pricing for movies.
Amy Miles, chief executive officer of Regal, said during a conference call that an incremental pricing model has been discussed by industry leaders, but rarely tested. Miles said testing of the model will begin in 2018, and the company looks forward to see how consumers respond to changes in pricing.
"This test could be the first step toward a pricing model that drives incremental revenue in peak periods and incremental attendance in non-peak periods," she said.
While Regal didn't divulge details of the plan, incremental pricing would likely cause ticket costs for shows on Friday and Saturday evenings to increase, while weekday matinees will likely be shown at a reduced rate.
The change in pricing strategy could be due in part to decreased revenue. According to Bloomberg, Regal saw a 12 percent drop in revenue in the second quarter of 2017 compared to 2016, which has caused a 21 percent drop in share prices. AMC, which currently is the largest cinema operator in the United States, has seen a 58 percent drop in share prices.
