Business Strategy

Five Industry Forces 

Force	Example	Force Strength	Response
Bargaining power of customers	Customers have many alternatives at home including streaming services, projectors, etc. This increases their beliefs on spending less money if not getting a better experience.	Medium	Providing comfort and unique offers that customers will like. Provide loyalty rewards and VIP subscriptions.
Threat of substitutes	There has been a rise in the number of other streaming services that rival AMC. This includes entertainment systems and the comfort of saving at home rather than spending money.	High	Exclusive movies that are only available in theaters are a great way to draw out customers from their homes.
Bargaining power of suppliers	Movie studios such as AMC control the distribution giving them a significant amount of power, but AMC being a large company teaches the risk of suppliers’ influence.	Medium	Amc can be flexible in its terms, providing balance in revenue share, particularly by the box office. Straightening bargaining terms with nearby studios and contracts.
The threat of new entrants	New theaters have high start-up costs. AMC provides modern streaming technology and a supply chain that other theaters do not compete with	low	Amc recognition for technology and innovation combines theater experience with top commodity streaming.
Rivalry	Amc competes with major theaters like Cinemark and Regal.	High	Bargaining price cost and enhancing movie experience.

Is the industry profitable?

The movie industry is facing a lot of profitable challenges. As the traditional movie-going has increased especially after covid, making this industry very easier to compete with. While there are a lot of movies limited to only the theaters when coming out, people have taken a liking to just staying in the comfortability of their home. Streaming platforms and many other forms of entertainment have decreased revenues and attendance for movie theaters internationally. This industry profitability rests only on the ability to adapt and better enhance the movie theater experience. This may cost a lot of money, but the technology can fill the barrier AMC and many other movie industries are facing. 

Competitive Strategy

According to Michael Porter, companies can employ four main strategies to gain a competitive advantage in their respective industries. These strategies are Focused Cost, Focused Differentiation, Industry-Wide Cost, and Industry-Wide differentiation. AMC employs differentiation on an industry-wide scale by offering exclusive services through its AMC Stubs loyalty program, including discounted prices on movie tickets and concessions items for its members. Additionally, AMC offers premium viewing experiences, such as their groundbreaking Dolby and IMAX formats and luxury amenities, including reclining seats and dine-in theaters. On the other hand, AMC also addresses threats from Porter's five forces by creating barriers to entry by combining brand recognition and loyalty alongside technological integration. To moderate buyers' buying power, AMC invested heavily in mobile ticketing and online reservations, making it easier and more convenient for customers to choose AMC over competitors. AMC addresses supplier relationships by leveraging its extensive global footprint when negotiating with film suppliers, gaining favorable conditions such as high-profit share and early access to blockbusters before its competitors. They also reduce their threat of substitutes by offering exclusive content and event screenings such as live-streamed sporting events, concerts, and advanced movie screenings. These event-style screenings provide a unique experience and help make moviegoing at AMC a social experience. They continue to lead the pack in the movie industry by offering diversified food and beverage options and movie-exclusive concession collectible vessels (CCV), which can only be bought in AMC concession areas. AMC continues to set itself apart from competitors through continuous investments in premium technologies, a strong customer loyalty program, and strategic partnerships. They effectively address the challenges posed by the Five Forces.

Value Chain

Activity	Description
Inbound Logistics	Sourcing films and concessions from various suppliers; managing inventory for theaters.
Operations	Managing theater operations, including screening schedules and maintenance of facilities.
Outbound Logistics	Distribution of promotional materials and managing ticket sales online and at the box office.
Marketing & Sales	Utilizing advertising campaigns, loyalty programs (AMC Stubs), and partnerships to attract customers.
Service	Providing customer service in theaters and through online platforms to enhance the viewing experience.

Business processes

    According to the Using MIS textbook, a business process is “a network of activities that generate value by transforming inputs into outputs”. The activities that are a part of this process can be done by human, computer system or both and produce outcomes such as order receipts or parts to a product. Two different categories of processes are the structured process and the dynamic process.

Structured Process: Sales Process

    The sales process at AMC involves the steps taken from when a customer decides to purchase a ticket to the completion of that sale. This process includes selecting a movie, choosing a showtime, purchasing tickets (either online or at the theater), and acquiring concessions. 

Ticket Purchase: Customers use the POS system to buy tickets, either at the box office or via mobile apps.

Concession Sales: Customers can purchase food and beverages through the same system, streamlining the checkout process.

Data Monitoring: The POS system collects data on sales trends, enabling real-time adjustments to staffing and inventory.

Dynamic Process: Marketing Process

    The marketing process involves AMC's strategies to attract and retain customers through various promotional activities. 

Social Media Campaigns: AMC utilizes platforms like Twitter, Instagram, and Facebook to engage customers and promote upcoming movies.

Event Promotions: Organizing special screenings, premieres, and exclusive content that cater to specific audience segments.

Loyalty Program Marketing: Enhancing the AMC Stubs program by offering promotions and exclusive benefits to increase customer engagement and retention.

Information Systems

    According to the Using MIS textbook, an Information system is “a group of hardware, data, procedure, and people components that interacts to produce information”. The structured process addresses day-to-day operations. An example of this would be placing orders. An information system that AMC uses as part of the structured process would be a POS system, which aids in sales. POS stands for point of sales system. Customers use this system to order their tickets and concessions before attending the movie. The POS system assists the business in monitoring ticket and concession sales data, which enables real-time decision-making about staffing and show timings.

    The dynamic process deals with a collection of activities that can change structure at any time. They are flexible processes that involve strategy. A dynamic process that many companies use, including AMC, is marketing. AMC markets their company using many different platforms, such as social media and paid-ads, like movie trailers. They even market certain movies that are only shown at the AMC theaters franchise.  Another way they market would be through their mobile app. The mobile app helps market the concessions and makes the ticket purchasing easier. 

Process or Product Implementation

    As the industry leader in theaters, AMC already has an abundance of amenities, such as Signature Recliners, expanded and improved menus for food and drink, including full bars at MacGuffins and AMC Dine-In Theatres; and premium presentation experiences, such as Dolby Cinema at AMC, IMAX at AMC, PRIME at AMC, and Laser at AMC powered by Cinionic. Still, there are a few information systems that have the potential to maintain AMC's top spot! For example, AMC already has an app consisting of purchasing tickets ahead, reserving a seat, and reward points. But our idea would be to enhance the digital experience on the app by allowing snack orders through the app, which allows consumers to have food delivered right to their seats while watching a movie. Long concession line wait times are avoided, and the whole experience is more effortless. Your meal will therefore be arranged so that you can eat it while watching the movie by the time the previews and commercials are concluded. Furthermore, you don't have to get up from your seat to miss any of the movie if something is forgotten. For example, streaming platforms have been huge for people that wanna stay in the comfort of their house and their own company while watching a movie. Therefore AMC should establish a partnership or build its own streaming platform for movies that have left the theater. This would provide AMC a competitive edge over streaming services like Netflix and provide customers with peaceful at-home entertainment while maintaining a connection with the company.