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The Alamo Drafthouse

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When we compare Alamo with its competitors in terms of two attributes: Food Quality and Movie Selection as axes, the result that we come up with is: Food quality of Alamo is good enough when we compare it with other competitors. Alamos’ movie quality is finest selection of sophisticated types of movies, since they screen generally cult movies. Also we can infer it from the famous people came there in the past such as Robert Rodriguez who hosted a special double feature of El Marciachi and Quantin Tarantino, director of Pulp Fiction.

Target Market Segments:
The Alamo’s programming is divided into two categories, second-run features and special events. These movies are carefully picked to demand to the Alamo’s customer demographic: smart 25-40 years-olds who have a classy taste in film. Special events falls into two categories:

·Austin Film society events and cult films. The cult films appeal to a different demographic: 18-30 years-olds, mostly male, who are regular alcohol consumers and are customers of less mainstream.
¬∑‚ÄėSpecial events‚Äô market segment is mainly based on : Italian Westerns which feature all‚Äďyou-can-eat spaghetti, and silent films with live accompaniment by local bands and Austin‚Äôs thriving filmmaking community who are some film makers to speak at special engagements.

Service Concept
¬∑Alamo Drafthouse‚Äôs main product is ‚Äúmovies‚ÄĚ
·Also serves a variety of beer and wine and offers appetizers, hot sandwiches, pizzas, pasta and dessert
· Service design has a better system than the other theaters that are in the same industry.
· Has a service between no-service theaters and full-service ones.
· Unique way of service without any verbal contact, which can distract customers’ during the movie.

·Customers write down their selections on a paper from the menu and put in a metal stand where it can be seen by waitperson.
·Possibility: to choose self-service in the lobby for all offerings.
·Customers enjoy their orders while watching movies.

Operating Strategies
·Keep ticket prices lower to increase the F&B revenue.
·Raise the menu pricing twice and adding more high-dollar items to increase spending
·Operate special events with filmmakers from Austin’s thriving filmmaking community.
·Have a unique system for service which minimizes disruption to film viewers.

Service Delivery System
Two ways of service delivery system:
1.Customers might either choose self-service in the lobby for all offerings
2.Write down their selections on a paper from the menu and put in a metal stand to use waitpersons to minimize interruption to film viewers.

Service Qualifiers
Before: Establishers Tim and Carrie have visited several theaters. They have detected several problems at these theaters. And then, Tim and Carrie realized moviegoers wanted to see a movie before than others and foremost and that good service meant that they would have to design a better system.

Service Winners
·The Alamo Drafthouse like most theaters has rows of seats plus some of rows have got enough dining space. ·Has a unique service which minimizes interruption to film viewers. ·Theater is located close to the center of downtown night life activity and requires only a short walk from one of the main club and restaurant areas. ·Alamo programming about 20-25 screenings per week and these movies are carefully picked ·Alamo’s ticket prices are low, typically $4.00

·Alamo plays the role of being host for some film festivals. Service Losers:
·No free parking for customers nor is there significant street parking in the vicinity. ·Alamo is somewhat tied despairingly to Hollywood for this programming and is occasionally forced to play movies that do not appeal to its demographic as much as Tim and Carrie would like. ·On a typical Friday night, much more staffs are required to operate a standard theater than others, which increases cost. ·Alamo’s purchase decision criterion is not suitable for multiple movie theater market because such theaters have three screens and Alamo need to purchase more. To conclude, Alamo Drafthouse has enough supporting facilities to attract clients more than shortages.

Recommendation to increase profitability:
There are two reasons the Alamo’s profits are limited: smaller capacity and high labor cost. To increase the profitability, Tim and Carrie should firstly consider increasing the capacity. They might have closer rows and more seats while keeping the space for tables to put food and drink. Second way is to decrease payroll cost. Especially for Friday nights, there are too many staffs required. They can also increase the ticket prices on the days that have rush hours.

Besides, they can give some happy hours/days to the customers like the Turkcell does in Turkey; they have an agreement with cinema companies that costumers have the opportunity to take one free of charge ticket when they buy one. Thereby, they attract the customers in the days when they have low demand.

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