Movie Ticket Prices Hit All-Time High in 2012: Why That’s Probably Good for Moviegoers

Hollywood had a pretty good 2012. Movie attendance rose by around 6%, and theater revenues and average ticket prices both hit all-time highs.

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Hollywood had a pretty good 2012. Movie attendance rose by around 6%, and theater revenues and average ticket prices both hit all-time highs. Curiously, the numbers also indicate that it was a pretty good year for consumers hoping to get decent value at the movies.

How could consumers be paying more than ever, and yet still arguably be getting better value? Well, as and others have reported, the average movie ticket sold for $7.96 in 2012. Yes, that’s an all-time high. But it’s up only a smidge from the 2011 average of $7.93. The numbers aren’t adjusted for inflation. So even though the average increased by 3ยข from 2011 to 2012, moviegoers essentially paid less last year once inflation is factored in.

The slight price increase in 2012 goes against the trend seen in previous years, in which the average rose much more noticeably. The Hollywood Reporter noted that ticket prices increased 5% in 2007, and another 5% in 2010, for example. It’s probably no coincidence that during this time period, the overall number of tickets sold steadily dropped, year after year.

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What’s more, 2012 was a successful year because studios and theaters gave movie fans more of what they wanted (blockbusters that were actually good films, such as “The Avengers”) and less of what they didn’t (higher prices because a mediocre film was shown in 3-D).

At year’s end, the Los Angeles Times offered a very simple explanation for why theater ticket sales rebounded in 2012:

Theater owners and distribution experts are attributing the uptick in domestic business primarily to better studio movies this year.

The fact that ticket prices essentially remained flat last year helped bring in the crowds as well. In 2011, by contrast, moviegoers seemed to grow tired of escalating ticket prices, especially with regards to the premiums charged for so-so films shown in unnerving, totally unnecessary 3-D. A new kind of “3-D effect” was noticed, in which fans seemed to avoid mediocre movies like the latest installment of the “Pirates of the Caribbean” series mainly because it was rarely available in a basic, cheaper 2-D format.

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This doesn’t mean that moviegoers aren’t willing to pay extra for 3-D or IMAX showings. They’re just more inclined to pay a premium when it’s a film they really want to see, and when the fancy format enhances the experience. In the fourth quarter of 2012, the average ticket price was $8.05, 2.8% higher than the same time in 2011, partially due to the more expensive 3-D showings of hits like “The Hobbit: An Unexpected Journey.” The average price in 2012’s second quarter was even higher, at $8.12, thanks to the mega-hit “The Avengers,” which was also shown in 3-D.

The movie studios are always looking for a formula for business success, and based on the data from last year, we now seem to have one: Make good films, and don’t rip people off.