Talking Business, Social Media & Movies with Marcus Theaters CEO

Hi Matt. Great to be here. Thanks for having me.

I'm glad you were drinking before.

No, it was it was terrific and actually really impressive. You're quite an accomplished musician. And so, let's start with that. Where did where does this interest in jazz music come from? Uh simply it was my grandfather. My grandfather um not Ben Marcus who's the grandfather that you know most people know. It was a guy named Marv Glass Beagle. Okay. Who was from Milwaukee actually and was a great jazz piano player. And so I grew up listening to jazz. You know there because they lived here in Milwaukee and all I was actually I was so lucky all of my grandparents lived here in Milwaukee.

Oh, did you really? All vinyl? Yeah.

Awesome. So, you you get this Marv Glass Beagle. Did I say that right?

So, you get this you get this interest in jazz music from him. Did you start playing and performing at a young age or were you more listening and te tell us about that?

And you were an accounting major right?

Yeah. And the jazz culture and I started playing out and I play in places where it's hard to fire me our whole

I can get fired but it's a much larger problem.

World class pianist. world class educator. I mean, to have him as a resource has been just amazing.

I am. Yeah. It's it's, you know, it it is an organization that Mark put together. uh it and with his years of history in the community and the jazz community here in Milwaukee and it's focuses on education and on playing and playing out and supporting the musicians that play out and building this jazz community and Mark and with his wife Aaron have been dedicated to building this organization and it's it's a great organization. They just in fact they just had their jazz camp but it's about education, performance and community.

Sure. Well, I mean, if if you go way back, you go um that was in 1935. About 10 years earlier, he had immigrated to the country when he was 13. Wow. 11 years. and he had come from Poland. Yeah. And he didn't speak any English, but he was an extreme. I mean, everyone knew he was very, very, very bright and very entrepreneurial. You know, there's a lot of myth that goes on around my grandfather. A lot of it is close to true. Okay. But he built this huge paper route up so big. Now, what was that when they when when he gave it up when he went to college, Yeah. they had to divide it among four people because he couldn't just one person couldn't do it. Now, the truth was my grandfather had learned a lesson early on which was how to delegate. and he had four people working for him. Perfect. There you go. I love it. So, uh he but but he built this great route up and he did really he was just doing always could do well. Eventually went back to work for the Minneapolis Star uh after he didn't finish school. He needed to come back and make money and he was working in the advertising area and one of the things that he was doing was selling advertising space to movie theater owners. Interesting. And back then, you know, that was the prime mode of advertising. And he would be uh helping develop their copy and put the ads together. And he started thinking, I like this business. I I would like to be in this business. So, he starts looking around Minneapolis for a location, but he can't find one. It's pretty built out. And he just sort of kept looking wider and I think he widened his circle and event looking in small towns in Wisconsin and Minneapolis that might need a theater. And he found a small town in Ripen. Yeah. That that needed a movie theater. and he found an old department store and he went and cut a deal to buy the department store and he'd had some family money and he got the guy who owned the department store to help finance it a little bit because he didn't have enough to get the whole thing done and the guy took a liking to him of course everybody liked my grandfather. He was tough guy you know he was he could he could you know he could bite off your head but then he put his arm around you the next minute and he just had away with people. That's really that's really well put actually believe it or not because he did I mean he was a he was a tough business person right and he was very resolute individual but but incredibly philanthropic caring compassionate in his own way for sure. Yeah, he had it. It was a unique combination. Sometimes people can be really mean and not have that put their arm around you or not. But he he could do it. Yeah, but he was he was tough, but he was but so he built the so he started the campus theater in Ripen. First theater, it's we still have that theater to this day.

You know, we uh I couldn't tell you where 2 through 20 are maybe 2 through 30. I'm not even sure. But uh but that theater is a single screen theater. We call it the shrine.

I've taken my kids there. We have Okay, you've got to

Yeah.

Well, I'm incredibly lucky to have the opportunity I had and is the and the truth is is the uh as my dad likes to joke, you know, we came to the attention of senior management at a very young age. There you go. So, but but it was, you know, it is been a it's been a you know, a great experience and and I've had the opportunity to do things that that many others don't necessarily get. Now, that is one of the reasons, you know, people would say, well, you only came back here, you know, you only got this job and you're because of who you are. I'm like, 'Yeah, but I did have an accounting degree and a law degree before I got here and had I I'd done a bunch of other things and I but but I wanted to come back here because I was still young at the time and uh I I wanted to have the opportunity to ultimately potentially lead it.' Now, I did not start off leading the business. I' I've been at the business uh for 34 years. I've only been the CEO for 15 or 16 of

it was. Yeah. So, so I did a lot of other things inside the company as I as I took on more and more responsibility. Sure. But it wasn't but it was not come on in and be in charge which does happen in some businesses. Now, you know, one is although we are a family business, I like to say that we're a family business and public company close. We are a public company. So, we have to operate like a public company. And also, you know, I thought my dad rightfully thought, well, if I just came in and made him put him in charge, well, no one's going to respect you. And I mean, yeah, you can tell people you're a lawyer all day long, but who's going to care? Right. And uh the In fact, they may not like you actually hear you're a lawyer.

Sorry to the lawyers out there, but I'm one formerly one of you. A recovering lawyer.

Yep.

Sure. My dad, Steve, a a great a great guy and equally smart as my grandfather. I mean, really very accomplished. Um he came back to the business in 1962. So if if you want give you a little history of the business it'll all sort of tie together because so my grandfather gets in the business and he starts he has this first movie theater very successful starts buying other theaters and developing other theaters and along you know in the about 101 15 years later comes television right and it upends the business I mean it's a complete disaster for the movie theater business and my grandfather decides two things at that point he he has this feeling that first of all that the movies are hurt but they're not going to go way is the pendulum was swinging too far to the extreme. Sure. And so he uses that opportunity to acquire a lot of theaters. Awesome. And to that were down in the dumps and became partners with landlords who had these theaters and they didn't know what to do with them. Y and so he realizing that he could take it he could be a take and be a part of that. But he also said you know what I shouldn't have all my eggs in one basket. He starts diversifying and saying I got to have some other businesses. Sure. at that he actually got into at that point got into the restaurant business. Okay. And he had gone he it's a great story. He goes out to California. He has this idea that he sees Disneyland coming on. He's like, you know, there should be we should there should be Disneyland in Florida. There was no there was no Disney World at this point. And he I guess had some land somewhere in Florida that he put up. He and his partner go to meet with Disney. Now he can get to Disney because of So he goes to meet with Walt Disney. I don't know if he meets with Walt, but somebody in the organization. Okay, go ahead. And he pitches this and they're like, 'Yeah, no, it's too early. We're not ready to do that.' And it's, for all I know, they had all of Orlando optioned up at that point. So, but while he's there, he sees this thing called Bob's Big Boy, okay? And this is there is no fast food. There's nothing. He's like, 'You know what?' And they're lined up by the door and his partner had been in the restaurant business, too, and said, 'You know what? We should look at this.' They look at it. They decide on the spot to do it. They sign up the rights to Wisconsin, ultimately to Wisconsin, Minnesota, Iowa, and Illinois to develop Big Boys. Yeah. Which were awesome restaurants. Huge like so successful. And then that got him into Kentucky Fried Chickens, KFC's, and we were at Applebee's. Restaurants became at one point the biggest part of our business. And at the same time, he was making some real estate investments. So, it's now it's the 50s getting into the 60s. Restaurants are cooking along, so to speak, and the theaters are doing okay. And he also had bought a motel in Apple. Okay. It was called the guest house in and I would affectionately describe it as a soprano style motel. Sopranos because it's like you know you pull you back the car up to the room cuz the the doors were back the car up throw the body in and leave. Right. So he had this that I only I tell you this because with the way the story it goes so interesting. So now it's now early 60s like '61 or something and he's he had now moved to Milwaukee and he's with his buddies and they all have their own businesses. One of them it's got like a meat business and one of them is a cleaners. And they said to him, you know, Ben, the Fister, which is the downtown, the Grand Wagi hotels, something's wrong. They're not paying their bills. They have a problem. They're going to go under. You're in the hotel business. You should buy this. Huh. In the hotel business, he owned a like a motorine in central Wisconsin. And this grandam hotel uh probably, you know, it's 70 years old. It's now 130 years old. Fast forward and my grandfather but entrepreneurial and gutsy says okay. He ends up be buying the buying the note becoming the receiver and takes over the hotel. Wow. And that's when my dad joins the company in 1962. My grandfather says here you go run you got the fister. So my dad starts to it's like the GM of the fister starts to run that starts to get a taste of the hotel business. They build actually remember there was there was no tower in '62. They built the tower which is uh the parking lot and the and the ballroom and then the the big round. Interesting. Yeah. So it was it was just that the base how many eight stories eight stories the original building we used to call that the old section then the tower was the new section but the tower is already now you know 60 years old it's hard to call it the new section but uh so the original building but he also then dis sees this new thing coming along my dad cuz like my grandfather really good at seeing what's coming next sees the uh sees the the the limited service lodging business and he says you know if I could take out all the unprofitable things in a hotel like a restaurant and you know the bell stand and all those all the things that really aren't very profitable. Yeah. The amenities that don't make that could just be a rooms business that could probably be very profitable. And so he's and he sees there's really only one other guy doing it. Lita sand bar shop is doing it. So he says I'm going to do that and he gets into that and that business just takes off. Yeah. And so we've got this full service. So now at this point we still have the restaurants. They're starting to get a little tired. The theaters are going along. The limited service lodging is going crazy. It's called Budget. Ultimately, we changed the name to Baymont and we sell it. But then and the full service, we got a few hotels. We have the Hilton, which at that point was the Mark Plaza and uh the Fister, but that really wasn't the focus of the business. And then, you know, when when I came back, the restaurants were sort of on their last leg. Budget, but was becoming Baymont, and we sort of saw an end to that path. And so, ended up selling that. So, at that point, we had the theaters and some and the full service hotels. So, we decided then to put much more money into the theater business. actually.

We're now in the uh getting up in the about around 2000.

Little past 2000. Yes. And I've been back now about a decade ago. Got it. And uh and we were growing our theaters. We had actually in the mid 90s was the first time the theaters ever left the state of Wisconsin. Forever the only in the state of Wisconsin. Now we're in 17 states.

Yeah, we go by screen count. So like right now we like to look we think about we're just under a thousand screens. Um we're the fourth largest in the country. Now the gap it sounds really like oh we're the fourth largest that you don't have to qualify that fourth largest in the country. That's pretty good. The gap between third and fourth is quite quite the Grand Canyon. Um it gives you a lot to aspire to.

So let I have to ask you this. So Big Boy by the way and and and they were ubiquitous when I was when I was growing up um in the Milwaukee area. Um, the Marx big boy. Is the Marks part short for Marcus or where does that come from?

Okay. My father just didn't think that was going to be the way that to to market it. So that's I want to mention a few things. You know, you think about first, you know, first of all, your grandfather who um I love being I love thinking thinking of myself as a contrarian. In other words, when everybody else is zigging your zag, I mean, that's where you find opportunities is everybody's going one way and you're like, 'This is an opportunity nobody's thinking about. Let's go over here.' Your grandfather just had an incredible ability to see to see around corners. I mean, is that fair to say?

Oh, absolutely. Really good at it. And and and and a contrarian and a and look at let's just even think about the la think about the internet. Okay, the internet we know is a huge thing, right? And and yet in what was it around late late 90s early 2000s there the market tanked. I mean it was just it had gone overshot the mark there was also could there you could have a bubble but that doesn't mean that the underlying business is bad. And the movie theater business is not exactly the same because if you go back to the to the 50s and you think about TV, it was it really did shrink the business, but it didn't mean it was going away. And that's a that's a parallel to today. Absolutely. In that, you know, um, look, it's it's not what it was before the pandemic, but they're still a movie theater business. People still want to go out and they want to be entertained. And as it turns out, the kids are the ones, which is actually when you think about the lifespan of a business, thank goodness, it's the kids who are all going back. It's the adults who can't seem to get their rear ends off their sofas. They seem to be stuck and glued to the sofa, which is not good because they're all home going nuts. But that's

One the one thing is actually I'm going to cheat because the one thing is called Ben's commandments. Okay, which there would be 10 of them. I won't give you all 10. I don't know that I could take the quiz on all 10, but my grandfather sort of put his precepts about how what he thought was important about the ways to do business. Okay. Most of which we still use to this day. Awesome. And so so one the one is you know keep your balance sheet strong and you know that was don't overlever yourself right especially our businesses where you don't know who's going to show up the next day totally to be overlevered has been a recipe for disaster for people and so keeping your balance sheet strong has been really important and it's what frankly it's what got us the pandemic. I'd love to tell you this cuz I'm so smart. I figured it all out. We just didn't have so much debt that we couldn't get through it. We had debt and it was manageable. We had to manage it and there were some days I was quite terrified but and we had to take on more debt to get through it which we actually subsequently retired but we but it was it was a challenge. Uh but but keep your balance sheet strong. People are your most important asset. I mean and that we say it we we try to walk the walk. Do I suspect that we blow it occasionally? Yeah. Everybody does. But but recognizing how important your people are. I think that applies to any business especially a business like ours business, you know. um g give back to the communities you live in. I mean those are all things that that we hold true own your real estate. We we are actually anomaly in the feeder business. Most of the guys just rent. Uh we own most of our we own most of our real estate. Some we don't because as we've acquired things along the way you just have to take on some leases but in our hotels we own our hotels. So we we try to own our real estate. Those things are foundational to what we do. The other thing which is it's an it's an irony in that but it reminds you that things do change is change is the only constant. Y and so knowing that things are going to change is is going is is at least you're forewarned.

It's going to change and so the business has changed over the years and it just it's always changing. And it's funny people would get up to me and they'd say you know when I first started this I think they've stopped asking because they but I'm going to tell you they'll realize it was feudal. They'd say Greg what is your vision? Where are we going to be in 10 years? And I'd say I don't know. Right? They're like what do you mean you don't know? Oh, and Mike, I don't know. I said, what I know is that we're going to stick to what we know, which is we're going to keep our balance sheet strong. We're going to try to own our real estate. We're going to remember that people are our most important asset, and we're going to think opportunistically about what to take, what what to what where to make our investments, and it'll all work out then when we do that.

For the most part, it has. We've had some boooos, but

Right. Yeah. Exactly. In five hours instead of one or whatever the um first of all these ten commandments you know the idea of keeping your balance sheet sheet strong. I can tell you um you know owning and running several businesses now um I've been in highly levered businesses. You know, I worked in private equity for with private equity backed companies for for a number of years and the that that model only works if you're levered up, right? That's the only way to to be able to get the, you know, to get the leverage that you want out of the of the equity investment. But they have a num but they have a portfolio where they have a lot of they're spreading the risk out. Yep. Absolutely. You know, they have, you know, when you only have one, if you lever it up, you're done.

Yeah. You've got all of you've got all this real estate. You've got all these assets and now they can't produce revenue, right? That's got to be just crazy.

Yeah. It was a nightmare. I mean, it was it was unimaginable. I couldn't have, you know, we we we carried low leverage not because we imagined that the world is like ending for the for a while. was one it was the most challenging time that I can ever remember. Uh and my dad said my even even TV coming for the theaters was nothing like really the pandemic because we were shut down. Yeah. We were going through 10 to 15 million a month just going out the door. We we were trying to balance the need of what it because the business we figured it would be reopening and first of all it was kept being was there going to be a few weeks and there be a month and then it's six months later the theaters aren't even open yet. The hotels had opened over the summer, but uh but the theaters had were really essentially closed. And then when we opened them, there was still so many restrictions and such challenges that you know in the hotel you could at least go to your room and be by yourself. And the you were sitting around together. Exactly. And so that was a much more challenging environment. But they were they were all for a for a while. I mean I wondered I thought oh my god we worked so hard all these years and this is this is what's going to happen. This was is this the end? I mean because we just who knew how long it would then last because it it was going on and on and you know it's funny during that time you know people people didn't want things to stop. like local organizations were still having like they would have these if you remember these online seminars you know and I would get invited to be in them a lot and I think I I used I I still make this joke that I was the poster boy for shout and fried pleasure and misery of others right absolutely and like people be like hey today we're here to talk about the pandemic and we have Greg Marcus and if you think your life is screwed up look at this look at him he's really in bad shape that's awesome and so they looking back on it that's it's a great story so I uh uh I did a lot of that but I would tell people the the same thing that I believe to be true today and that is as humans we are wired to be together we want to be with other humans we want we desire that connection uh and it's important for those connections are really important and I said that's why I believe there will always be a movie theater business people are going to want to be together there's going to be a hotel business they're going to want to travel they're going to want to network they're going to want to do all those things and so

I just read you just had like your biggest weekend ever, didn't you? Is that We had a very big weekend. It was a very big weekend for uh Toy Story 5, which was a great movie. I haven't seen it yet. It's so good. Yeah. I mean, yeah. I It was Yeah, it was it was, you know, it's I guess I'll reveal something about myself and my humor and that one of the characters is a uh an older like say I'm guessing like, you know, an older 20-year-old electronic device and it was the the reason it's it's toy was that he was teaching kids how to be potty trained. Okay. I mean, imagine all the jokes you get, right? Yeah. Exactly. Yeah. You're not the most popular guy at the toy cocktail party, right? If that's your shop, right? It was. And so it's like an hour and a half of like, you know, poop jokes, which is like right up my right up my alley. Nice. That's awesome. Well, I'm definitely going to check that out. And for for our our listeners who who are not offended, right? Exactly. Exactly. I'm sure Toy Story 5 would love to know that that's how we characterize their their film. Um but but um Greg is the face you see at the beginning of every single every single film you better. Yeah. And it's terrific. I mean, you've become a little bit of this kind of um this celebrity. I just read somewhere I used to I used to spend a ton of time on TikTok and I I I so I was in China for um a week last August and um be before I went I actually about two months I before I got I just had these you know bite bite dance paranoia or whatever. So I I I shut down my Tik Tok account. Um but I mean you you're viral all over Tik Tok with your I mean so talk about talk about that. talk about the the persona that is not just the organization, but you you're the face of the company and have this, you know, you have a familiarity with the audience. I think that that is really unique in the space that you're in. Just what does that mean to you?

Yeah. No, nobody else is crazy enough to do what I've done. I, you know, it's funny. I didn't do it to, you know, people are like, 'Oh, Greg, you giant egoomaniac. All you want to do is see yourself on the screen.' You know, I recently told the managers of our, we had a managers meeting. We have a regular conference and we all bring hundreds of managers in and Sure. And I and I was telling I you know it's been now I've been on for 14 years. And so I you know I not many of them know exactly sort of why it all happened and they just think I'm a giant egoomaniac. And so I'm like they don't. I said uh I said if you want to know the story I said first of all let's in case you think I'm an egoomaniac. I said first of all how many of you in this room of hundreds of people raise your hand if you like to see pictures of yourself. Of course no one raises their hand. I'm like well okay try and imagine seeing yourself on a 50ft screen or 70oot screen. It's really not a pleasant experience. And uh I said, 'But but what what happened?' This is a great this is good on so many levels because it's about doing the right thing and then good things happen. In 2012, I was one of the co-chairs of the United Way campaign in Milwaukee. Awesome. And I was going in for the weekly meeting and the head of marketing there uh was, you know, getting the Greg show. You know, it's like I come in and I'm joking around, you know, I'm I'm like this most of the time. What you're getting is not is sort of just me. This is Yeah. This is an 18 hour a day. Greg Marcus, huh? Yeah. Which is a little bit much for some, but a whole different problem. Um, am I handling it okay? You're doing so far. I don't know. I feel fine. How you doing? So, she says, you know, you seem like you're fine. You know, you give us a PSA, a public service announcement for the United for our campaign every year during the fall when the campaign's on. Would you would you go on the screen and and do it? And and I do do it yourself live. And I'm like, can I think about that one for a minute? I'd never been on a screen before. Never thought about it. I did go to film school, so I was into movies, but I never thought of myself on being on the screen. It was to make movies. So I thought about it and I one of the things I was always interested in this idea of, you know, people don't come to our movies even to this day. No one's coming for me. Nobody's coming really for Marcus theaters. What they're coming for is Toy Story. They're coming for Spider-Man. They're coming for promote all the movies that are this summer for anyone that I could sell. Absolutely. That's what they're coming for. And but you know it but it if I could welcome people and have a little fun maybe that would just add to the experience a little bit and give them some you know something makes I I don't know what I just thought why not and I said to so I said to I went back to him and said okay I'll do this if I can welcome people have a little fun with it have a little laugh and they're like if you'll ask for the money you can pretty much do whatever you want and so I'm like all right and so we did it and the first it ran for about three months during the campaign for the first year. This was in 20 2012. And you know, like mostly like my parents' friends. Oh, Greg, I saw you on the screen. You look so good. I'm like, you're old. You're blind. Come on. Really? But you know, it went on and then as it went on, I noticed more people. Then the next year, we did it again because they liked it and they thought it was beneficial to the campaign. I'm I'm just trying to help the United Way campaign and help us a little bit, you know, and but I'm noticing like I'm starting to get recognized more and people are are like thinking I'm like I'd be in another market. Like we're like I went down to like Lincoln, Nebraska and they I was meeting with people and they're talking to me like they know me and thinking, how do you know who I am? Oh yeah, you've seen me on the screen. You feel like you know me. I'm I'm generally like I am now. I'm sort of like what the screen thing is. I help write them. I'm classic dad. my jokes. If I'm into the poop jokes, I'm classic dad, right? You know, uh, and so, uh, we we we started saying, you know what, let's go on the screen all the time with them. And we did. I figured, you know what? I don't know if it's helping the business, but I don't think it's hurting us. And it's always good to be seen as being local. In the old days, if I would go to a theater or my dad would or my grandfather, they might not know who we was or who we were because we were just some some somebody from out of town and we didn't have that kind of credibility that we would have and doing business in another city. And then also the other thing that was really interesting that I never anticipated was what it would mean to our associates, we call our employees associates, our our associates where they feel like they know me first of all they've been they first of all they're subjected to me repeatedly the movie theater. So when I come now, that's like all they want. They they want to meet me. They want to take pictures. They want to they feel connected to me, which I think is a really important thing to make our business more successful. And so for a lot of other reasons than people just coming and now they're used to me. Uh that's why we did it and why I do it. And the Tik Tok thing, that's a whole that's a whole another really interesting thing.

I know it's crazy. And by the way, you're one of the few adults. This is so the the the Tik Tok stuff, if you've seen it, you know, is a little nuttier than what's on the screen. The screen is classic dad jokes, stupid jokes. The Tik Tok stuff is more what's on trend and whatever is being goofy with Tik Tok, which I'm more than willing to subject myself to, but I also know that's not my I mean, I can do it, but we have a social media. Yeah, you're getting some help. Some 20-year-olds and I pretty much do whatever they say. But it was really interesting. They came in at first their social media. That's a good business plan. Do whatever the 20-year-olds say. Exactly. So, they come in and this was well where it started was actually with like with like uh Instagram. They're like, 'You should have an Instagram account.' I'm like, 'Okay.' I said, 'How many followers do you think that I could get?' And they're like, 'We think you can get 20,000 followers.' I'm like, 'Um,

Okay. Let's think about this for a second. Well, you know, I said, 'I'll try it with you, but let's just think about the time we're going to spend doing this and how much time it will take. We sell, you know, over 20 million tickets. If I'm only talking to 20,000 people, that's not the best use of my time, as fun as this would be, and I'm a goof. I love doing this stuff, but I'm not going to, you know, I'm not going to do for 20,000. So, but I'm always willing to try new things. It's important lesson. Just be willing to try stuff. So, now this TikTok stuff starts happening. They come in and they say, 'Let's try TikTok.' I'm like, 'Okay.' And we did one and it was like we got like 750,000 hits. I'm like, 'Wow.' Okay. Okay, you have my attention. We're on to something. I will be a part of this. And so they don't all have that kind of traction, but we did some and they sort of lever it now with Instagram stories and we have had we had one that had 5 million views. You could tell the best part of it was they showed me a it's like I had to say I'm a snake. I'm a snake. Which was some YouTube thing, right? And I don't have any clue what it was. It was not and and they to do this.

And I we filmed like six of them or seven of them at a crack or 10 of them and they just roll them out. And so I they had me do this and I uh I did it and it starts blowing up and my my son calls me who's dad that is so funny. I'm like

What is funny? What do you Michael? I see this blowing up but what is funny about this? He goes, 'Oh, it's this old YouTube thing.' And he points to it. I'm like, 'Oh yeah, that looks familiar. They showed it to me right before I did it and said do this.'

I have not had to do that. No.

Yeah. It's I'm on YouTube shorts now and it's it's similar to Tik Tok. Although I'll admit I kind of preferred Tik Tok a little bit better, a little bit more. But um the uh I need to get back on I guess now that I'm back from China. Um but yeah, it's just amazing to to think that you're reaching you know 5 million people and and you're it's not free, right? Because you have a social media team that's doing this and and what have you, but it's not like you're paying for that advertising necessarily.

Yeah. No, it's actually really good and and it's you know what the thing the funny thing was the first time I I read the comments. The the most interesting is the comments. I have to admit the first time I read the comments I was terrified to read them. I was thinking to read like you old get off get what are you doing on TikTok you suck you know all these cool sorry words suck you're terrible but no it's like a love fest it's the funniest thing like and but what I love reading is oh I I I just remembered I have to go to the movies I want to go to the movies and that's okay that's what we're trying to do so it's just about familiarity and you know branding what do they say half my advertising works I just don't know what

For sure. My favorite one and I we all thought like

Yeah. Oh, the Burger King one was so there was my my favorite one is where he's like doing it and he's he's imitating him and he's like and we've got this this this big the big arch with the the sauce product and the meat product and the whole thing and then crisp onions and he the guy says wait did I approve crispy did I approve and he sort of looks up from the camera as he's imit screaming I'm like yeah that could be the guy

Actually, it's funny you say that. Like, and this is why I was worried to read the comments at first cuz Tik Tok is is tends to be apparently a very nice environment what I've noticed. But Twitter, maybe not as much X, whatever, but it was still Twitter back then. And the first time when we were initially were going on, someone posted on X. And usually it's drunk people late at night cuz usually I'll find is the mean comments go up late at night and they're gone by the morning when the guy sober up. I was like, 'Yeah, I shouldn't have written that.' Oops. And I get on one night and I see the guy's written, 'Get off my screen.' Now, I'm told never to respond, but I I can't help myself. And I write back, 'Technically, it's my screen.'

But yeah, absolutely. Appreciate you being there. That's beautiful. So let's let's talk a little bit about and and I I'm fascinated by markets by finding ways to to maximize revenue to you know I I think I in fact I'll preface this with a Summerfest story because forever Summerfest by the way for our non- Milwaukee listeners largest outdoor music festival in the world um for years it was all about how many people went to Summerfest right it was just all about the numbers and they'd report them every day and if they were behind one year it used to run for 10 days in the summer and Now it's on on various weekends, but but every single day if they were behind the the year before it was like this huge huge deal and that's how they measured their success was how many people went to this with went to this festival. And then 10 12 15 years ago they morphed more to it's about finding the right consumer, giving them the greatest experience, finding opportunities to derive revenue in multiple ways. And it seems to me, you can tell me if I'm wrong, that that is kind of the way the cinema industry is going in terms of it's not necessarily about how many people you can fill a theater with, although that's important, but it's what is that experience and and um are they willing to, you know, pay more for certain amenities? Um are you targeting maybe a more um affluent customer that had that spends money in different ways? I'm just interested in how that whole market is changing because obviously the world you're living in now post pandemic uh before that post streaming um and streaming even becoming more ubiquitous now. H how is how is all of that changing in in your business in terms of the consumers that you're you're going after? How you're maximizing first of all their experience in the theater, but second of all um the you know the the economic model of that experience. Well, you're right about the economic model has changed. I don't know if it's permanent or not. Look at the the biggest challenge for the theater industry that would reduce um attendance is and by the way, I think actually attendance is really important. Okay? Uh you know, the more people, the more customers you have, the more chances you have to have revenue come in the door. So, I am actually proattendance. I'm proattent Summerfest, frankly, as well. Okay, that's a whole different issue. But look at I got I'm dealt a set of cards I have to play. Um streaming I always you know what we always watched per capita visitation as more things were being sent into the home it was eroding per capita visitation but not to the point we've seen now. So streaming is a piece of it and that's just the more product you stuff downstream. We call it going downstream because if you think about it, you know, theaters are sort of the top of the food chain in terms of per capita price people pay and then it works its way through the you know in the old days it was DVD rental ownership rentals and then broadcast TV and you know so we go on you know through that through that cycle through it's called windows actually the process of selling the same thing to the same person over and over again.

Exactly. And uh and so streaming was a would you know is like supercharged TV. That's really what it is. And that's the good thing for us in that regard because you know whether you're watching Terminator on your TV uh because you're watching it on TNT or you're watching it on, you know, uh any one of those streaming services, it's the same experience. Going to a movie theater is a completely different experience. So that keeps us differentiated in that regard. But but again uh command the demand for people's time, entertainment time. The more they pump down there, we're going to see some erosion. But there's other things that have gone on that have helped that that have actually caused the audience size to erode in the theater. One of which is what's called the window. The time that we have it for exclusivity. It used to be six months and years ago. It got down to about three months pre- pandemic. And now people think it's 15 seconds. But to some of the some of the films that don't perform well, it can be two weeks to premium video on demand, which a $20 rental, right? Which is a very small market actually. Not many people want to pay 20 bucks to rent a movie at home. Uh but that but they start marketing it and the perception is that it's coming fast and it's free and it's at home and there's a ton of stuff. So shrinking the window, which is actually starting to reexpand because the studios have realized they're hurting themselves, right?

Or you may skip it in the theater and say, I'm just going to I don't have to wait very long. So, so having the window shrink was was a problem, but that's again that's starting to lengthen again and go back out, which will be which will be helpful to the business. And then, you know, the number of films we're getting from Hollywood has shrunk. When Disney bought Fox, very tough for us because all of a sudden 10 films disappeared. Right. We the movie business is a numbers game. If you release 10 movies, two are great, two are terrible, and six are somewhere in the middle.

Yeah. I mean, so you got to you got to be capitalized well enough to sit at the table long enough. And so, uh, it is those things have eroded the attendance. Now, what's happened is the other side of that is ticket prices have gone up to cover some of that. People are paying more for the premium large format stuff, the ultra screens, the screens, the things like that. And our concession food and beverage sales are up. people are treating themselves more. We sell the most interesting we sell this merchandise. It's very high price. You know, like the popcorn tubs. Uh we sell a lot of that stuff. And I my thought on that is people are saying, 'Well, I don't go four times, five times a year anymore. I may as well treat myself the two times I go.' I'd rather frankly have you come four or five times to be honest. I'd rather have that. But if the alternative is going to be you're going to come a few times and you're going to treat yourself more, then okay, I'll take that trade-off. So, we're adjusting to the cards we're being dealt. But if you ask me what I would prefer, I would like to have more attendance and and because I also want movie going to be seen as something that's affordable.

My message is think of the trade-offs that that you're going to be making and don't think about it as a trade-off between TV because look at TV and movies have always I mean you could watch TV for free for a long time and movies. It coexisted with TV for a very long time and we've had economic cycles where where people had to tighten their belts. The interesting thing is when people have tightened their belts, think about what you might be tightening from where movies then become much less expensive. Well, maybe you're not going to go to a ball game, okay? Or you're not taking that vacation. You may not be going as far and you say, you know what, okay, I didn't spend the thousands of dollars of my vacation. Well, maybe I'll take a hundred bucks and go to the movie theater with my family and that so I can at least have a two-hour vacation with my family or by myself and get out of the house and go run away and hide from my family.

I have a joke. As long as they're 16-year-olds, we're going to have a business cuz someone has to leave the house.

Yeah, it's happening because a couple things. First of all, consolidation. So Disney doesn't that their theory isn't to make a lot of movies. They make they make a few movies. So they bought Fox and they took out a producer basically and they make still make Avatar and they make a few Fox films that Prada was a father. The Devil Wars Prada was a father film. Uh but they don't make nearly as many as they used to because that's philosophically how they operate the business and they bought it really for the library for Disney Plus and for their for for everything they had. So consolidation is a piece of it. The other part of it is balance sheet. So one of the things that was going on in the world was that uh everyone was chasing Netflix and the idea was well I don't need to have windowing. If I can just sell a billion if if my TAM is a billion and I can have a billion subscriptions or 500 million or 600 million subscriptions I don't have to worry about all this windowing nonsense. I'll make my content and put it on my streamer and be done.

Doesn't quite work that way. And Netflix is the only one who's even close. And you know, they could even they're even leaving money on the table by not putting their movies in theaters.

Uh, in fact, Narnia is going to be in the theaters and they're going to they'll have a few things in the theaters now. They're not going to be a great they're not going to be a great contributor to us, but

Yeah. I have no clue where that's going to go. Not counting on it, but we'll see what happens. Um the but but in chasing Netflix and they had all these you know guys you know whether it was Warner's or Paramount or NBC they were they were you know loading up on debt and constricting their balance sheets. Warner and Paramount, good producers. The NBC is okay because they have Comcast and I'm sure they announced a spin-off today, but they were great balance sheet. They're okay. They weren't they they weren't as constricted and they were there. They've been a great still prolific maker of movies. Sure. Warner used to give us 24 films a year. They're down to about 12. And it's really simple. What happens is now when when you have to decide, okay, I only have this much money in the till, right? I got to pay off my debt first. Okay, there's this much money left, right? And I've got to support all these different businesses. I've got HBO. I've got I've got my theatrical business. I've got all these different things. I got to allocate my capital. I can't make 24 films anymore. I can only make 12.

We have empty shelf space. That's what it amounts to. We have shelf space that could be filled.

Um, well, I don't know. You know, it's we'll see. Amazon all of a sudden Project Hail Mary was a huge thing. Amazon has said they're going to be committed to theatrical. Uh, because they do, one of the things that they do realize is that films that play theatrically and do well do better on streaming. It increases the value downstream. And just think about I mean it's it's sort of logical, right? Think about how you use your streaming service. You go on.

And you say, 'Okay, gay family, let's engage in the torture of picking a movie tonight,' which I hate, by the way. And so you look at this thing and you're trying to figure out what to watch. You're looking at a thousand tiles. You can't figure it out. You're like, 'Oh, I heard of that one. It was that was in the theaters. Okay, that might be okay. Let's let's put that on the possible list.' And so having it because our shelf space in a way I say we got empty shelf space in any given week. Our shelf space is very limited.

You know, we can only play a few big movies a week. And so, you know, we really can distinguish product in a way that you can't on streaming. There is there's unlimited shelf space on streaming, right? And so, they don't really distinguish product the same way we're able to. And the other thing that's important for us that that why streaming, you know, it's streaming is a very watching TV. Let's just call it TV is laying there on your sofa. And there, by the way, I do it too. It's a good thing. You need it. It's a very passive activity. You lay there, you flip through, you have no investment in it. You can turn it off. When you go see a movie in a theater, you've made an investment in your time. You're going to go on someone else's schedule. You've decided to figure how to get your butt off the sofa and get to there at a certain time. You have committed yourself to sitting there quietly, maybe only to look at your phone maybe once or twice, trying to watch it too much. And you take in that experience in a way that's you've made an investment. Totally. And when you invest in something, you tend to be invested in it.

Don't forget your candy and your soda.

But those are it's interesting though because it's almost like a little like Pavlov's dog. Like if I'm watching a movie at home I'm just watching the movie whatever. If I'm going to the theater, it is I'm grabbing the Juju Bees. I'm getting the big thing of of popcorn. I'm buying the big soda, whatever. I mean, it's that it's that experience of paying. I always tell the story of like I can use the one I can timing is perfect. It's like I can take I'll take the bet with whatever amount of money you want to bet me that and I'll take zero and under for the amount of kids 20 years from now who come to who you say, do you remember your first movie? and they say, 'Oh, yeah. I remember my parents took me into the family room and we turned Toy Story on and we sat there on the sofa and watched it.' There'll be zero who say that. But 20 years from now, there will be measurable amounts of kids who say, 'Yeah, I remember my first movie. My parents took me to Toy Story. My mom held my hand. My dad bought my me popcorn and I thought that the that the poop joke machine was real.'

Yes, Fables. I just watched that and that and it starts with his experience of going to the to the theater for the first time and it's that that's exactly right. Um and and so it is I mean it is an experience for the family and and it's it's a memorable boy and it should be something somewhat you know monumental at least the first one but but it is that experience of doing it whether it's your friends. I mean that was my thing. In fact you bring up Mark Davis. We he and I saw so many movies together in high school cuz there were a group of about seven or eight of us that like one weekend a month at least we would we would go to the cinema and and watch movies and that I mean you just have those incredible incredible memories that you attach to it in a way that you don't from although I do remember sitting at his house and watching Spinal Tap with his brother. That's another story but but you don't have that same set of memories that you did when you uh when you went to the theater. So

I'll tell you a cool story about Spinal Tap actually sad and cool. I was, you know, I'm in movies. I I when I went I went I went to film school, which I dropped out of. But when I went and the lady in the early 90s, 80s, early 90s, I was, that was Rod Riner's, you know, when he was really putting out, you know, Stand by Me and and Spinal Tab and all these great bride, right? All these great movies, Harry Met Sally. He made such a run. I mean, he was like one of my heroes. And I uh when Spinal Tap 2 came out last summer, our uh our people said, 'Hey, and we have a chance to film, if you know, some of the ones I've been doing lately, I'm actually doing with some talent.' They said, 'We have a chance. If you want to go, you can film some uh a trailer with the Spinal Tap guys and Rob Reiner.'

Uh yeah. Tell me where to be. Right. Exactly. And I went out to Hollywood and we shot it. And I have 20 minutes of raw footage of us just of of like a like a live spinal tap thing going on.

And I took the whole jazz bit with him. I'm like, 'So you guys, you know, they did a whole if you look on YouTube, they're thing about jazz. It's just a series of mistakes.' You know, why are you so scared? You play so quietly the whole thing. And I got him to do that whole bit. And and I and I had such a good time with him. And I actually sent the email to Rob Reiner afterwards and said, 'What a great experience.' He said, you know, he said, 'You were great. We had a lot of fun.' And I thought maybe one day I might bump into Rob Reiner again and he's gone.

For our Spinal Tap fans out there, they'll they'll get that joke.

You know it's I can first of all it's changed it a lot already in that think in ways you don't necessarily see. So think about so projection all our projectors are now are digital where they used to be film.

About about 10 12 years something like that. Okay. So digital but digital projection allows us to play different movies at different times very easily. Uh it allows us to bring in content we couldn't bring in before the Met live metropolitan opera live things like that. Um we're able to much more easily play a diverse set of content. how you buy your tickets, you know, you used to come into the box office, you couldn't you couldn't look on a screen and see where your seats were going to be, you know. So, if you think about how that has all uh has played out, um our loyalty program and how we're able to email you and how we're able to know something about you. Now, I would say that I don't think we're as good as as we can be uh at sort of creating a community around something that people love like going to the movies. One time I joked with our team. I was like, cuz I was talking about the importance of our communities and how we should leverage our loyalty club. And I said, 'Wouldn't it be great if our customers tattooed our products on like the Harley customers and wouldn't that be great?' Right? And they're like, 'Yeah, I'm everyone agrees with me. It's great. I love when people agree with me.' So now I uh I walk out of the meeting, I think about it, and I send everybody out. I was wrong. Our customers do tattoo our products on cuz you know there are people who are walking with Yoda tattoos. There are people, you know, there are people who are walking around with with Superman tatto. I had a friend tell me about a Star Wars wedding they were at or the the groom dressed up as a Jedi last last weekend. I mean, they are passionate about our product and so we should be able to lever that. But knowing our customers, that's and then AI will just be another part of that, you know, learning, finding insights from the troves of data that we have.

Absolutely. We have I have uh I have actually we hired a computer scientist.

Uh to lead our data strategies. He's a data scientist to to understand these because we have huge volumes of data, right? And to try to to be able to to be able to maximize the performance of what we do and sell the right thing to the right person at the right time at the right price.

Make sure you're surrounded by good people.

I mean, at the end of the day, that's what made the difference with us. I mean, that the balance sheet was important, but I didn't do it alone. You know, I had great people around me, great board members who rose to the occa. They're always great, but who really said, 'We we know you need us now.' and the our executive team, you know, really cuz cuz it was hard times and could be, you know, easy, I guess, sort of easy to walk away if you wanted to, but but they they stuck with it and they helped us get through it. And it was everyone working together, but having it there was my general counsel Tom Kissinger and my CFO Doug Nice and my current CFO Chad Paris and my dad and uh and and our board members Phil Milstein, my friend Dave, my board member I board member passed away a few years ago. his name was Dave Balmer was just a star and uh so it was all these people who helped us get through it.

Hope I got it right.

Yeah, exactly right. We can always edit it out.

I look at I can only talk about my approach to it. You know, at least you're talking about my educational get a build a strong foundation for whatever you want to do. So my undergraduate degree is in accounting. Yeah. You know the numbers are the lifeblood of a any business. You can be in any business if you understand the numbers. uh law I mean you know it is it's it's it is foundational to what we do and it gives you a way of thinking about things and processing ideas and so uh it was you know that I thought that was really important very broadbased but but you know uh it also is a profession those are both professions my grandfather was always like you got to have a profession and then that led to you know uh being going to film school because you know if you're going to have a movie theater business you have should have gone to film school which I dropped out of but I uh got the basics And then having law school, I I'd already had my law degree. And so when I went to tell my dad I just gotten into USC film school, which is a great film school, right? And but I could just hear the audible gulp, right? But I'm like, 'Dad, if it doesn't work, I'm a lawyer. I mean, I'll be okay. Don't need to worry about me here.'

Yeah. My only mistake actually was that I uh I took the after I finished law school, I had I'd actually had a job offer from a great firm in Chicago and I uh

From a law firm. Yeah. Which I said, I'm I'm going to film school. They're like,

Yeah, it's the first time. Exactly. I was right up there with you. Well, you know, I will you should have read my resume because I have a undergraduate degree in accounting with a photography minor. So, this shouldn't totally surprise you. So, uh but the um I took the bar in Illinois thinking, you know, if worse came to worse and things, if I ever if I let's assume that things I didn't have anything at home, I wasn't planning on coming back at that point necessarily, but I thought, you know, let's say things all blow up and I'm going to be a lawyer. Well, you know, Chicago seems like a good place. I'll be there. I should have taken the bar in Hawaii. Going down the toilet going somewhere where the weather's not.

Do it where the weather's warm.

Yeah, take the bar in Hawaii. Um, well, I would take the piece of advice I do be do what do whatever you do and when you're younger, make sure that what you're trying to do is be foundational to whatever your experiences are. Think about what you want to do. So, like my first job after I'd come back from my my film school experience and my Hollywood thing was I got a job with a commercial real estate appraiser. Well, we're in the real estate business. That's very foundational to what we do. I learn how to value real estate. So, think about doing again things that are that'll that'll that that'll give you the broadest chance that give you the most optionality. Um, be patient. I was not very patient. Yeah. You know, I see that. You know, it's when you're 22, you just think you've got to figure everything out right then and there. You have no time.

Yeah. No, right. Exactly. Yeah. This CEO gig. Yeah. I think I'm pretty much I'm stick a fork in me. I'm done.

Thanks for having me.

It's at uh it's it's actually the Marcus Theaters.