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Movie Producers Face a Huge Crisis of Customer Intuition

The New York Times has a rather obvious report on the clear customer intuition crisis that the movie industry is facing. The movie industry appears with few exceptions to be in a downward spiral of poor quality products that perform poorly due to external competition, distribution competition and poor customer experience.

Customers are finding alternatives for their entertainment time and money. Gaming, internet use, books, Tivo dumping and even board games are contributing to reduced movie ticket sales.

Prices are dropping for new and used DVDs. Prices will continue to drop as customer collections mature. Publishers will discount their offerings to boost sales. Competition from Netflix and discount retailers will also drive pricing down. Customers are also drawn to TV shows on DVD. The smaller chunks of entertainment may have a real appeal. Customers can watch 20, 30, 60 minute stories without having to commit to a full 90 or 120 minute film.

Home theaters are becoming more prevalent. Large screen TVs with or without surround sound are becoming a real convenient option for time and increasingly fuel starved customers. Why go out when a superior experience can be had at home.

Customer experience is becoming a real problem. As multiplexes look for multiple sources of revenue and turn to advertising, high priced concessions and arcade games they are creating an experience that is only tolerated by teenagers who have different standards of acceptable theater behavior. Talking, seat switching, cellphone use, etc. are behaviors that are not well tolerated by older(35+) moviegoers. This encourages older customers to stay home and watch DVDs on their home theaters. When the rare movie designed to appeal to baby boomers is released theater owners and movie studios wonder why older movie goers don't come out to the theaters.(Witness the theatrical disappointment of Cinderella Man) They don't have enough customer intuition to see that they have designed their customer experience to be unfriendly to precisely the customers who can most afford the alternatives of DVD collections and home theaters.

Is your customer experience driving customers to do more business with you or to seek alternatives? Over time your customer base may have shifted. Are you still aligning your customer communications and experiences to who your customers really are?

NYT on the Movie Business

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August 25, 2005 in award winning newsletter, Blog Outsourcing, blog publish, Building B2B Relationships, Building Customer Community, Business Marketing, Business newsletter, CMO, Current Affairs, Television, Web/Tech | Permalink


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