By By JOHN EBY / Dowagiac Daily News
With the movie industry riding its longest losing streak in 20 years, there probably could be a better time to answer once and for all whether Dowagiac can support a theater, but that question nevertheless is a component of the market study under way.
While going out to catch a summer blockbuster remains a popular pastime, year-over-year ticket sales have declined 17 straight weekends - the industry's most prolonged slump since 1985.
Summer is traditionally the strongest season, but box office is off 8 percent compared to 2004. The number of moviegoers peaked in 2002.
Plenty of explanations exist, from mediocre films to steep prices for admission and snacks at noisy multiplexes.
Turnaround time from big screen to DVD has shrunk to four months as studios try to protect their investments from video pirates.
Home entertainment systems surround viewers with sound. Surveys show a majority prefer to stay home rather than mix with the masses. There's competition from video games.
In a USA Today/CNN/Gallup Poll of 1,006 adults, 48 percent said they go to the movies less often than in 2000. A third prefer watching movies at home; 24 percent say it costs too much to go; and 19 percent say the movies are low-quality. Special effects overshadow substantive stories.
What would bring them back? Cheaper tickets and concessions, 71 percent; better movies, 70 percent; and better controls on audience behavior, 48 percent.
Then came Tuesday's announcement that AMC Entertainment and Loews Cineplex - two of the biggest U.S. theater operators - are merging in an attempt to shore up profits at a time of soft attendance amid intense competition from other entertainment sectors.
The $15.5 billion spent on DVDs last year jumped 33 percent from 2003.
Nobody knows with any certainty whether Hollywood's downturn is temporary or hardens into a more permanent cinema drop-off.
Many industry observers scoff at apocalyptic predictions for theaters, which withered in the 1950s but eventually weathered competition from television's popularity.
The city received a $10,000 grant for the market study and matched it with $10,000 in local funds to hire the Ann Arbor firm from 11 proposals.
Meeting at City Hall with Nelson, Economic Development Director Sandy Gower and Downtown Development Authority and Chamber of Commerce Program Director Vickie Phillipson were MapInfo's Patricia Formosa, director of economic development, and Paul Lichtenberg, client services manager. They spent two days circulating through the community and talking to merchants and others they encountered.
Dowagiac's study has a residential component for which MapInfo contracted with Carol Gies, a principal of Insights research, business strategy and marketing of Naperville, Ill.
The trio gathered information on Wednesday and Thursday, with Lichtenberg poking around downtown and Formosa venturing farther afield, driving from St. Joseph/Benton Harbor down to Mishawaka, Ind., "so we can get a real good understanding of not only who's coming here to shop, but where people here are going to spend their money and why, instead of staying here, they're driving to Mishawaka."
As for how they determine Dowagiac's viability for a movie house, "We take a look at the population, the expected potential for that kind of use and what kind of competition. Are there really enough bodies who would come in and support" a theater, Formosa explained.
Gies said, "As a genre and an investment, movie theaters are about the worst investment you can have. We did that thing for Lombard and right at the very end they just turned it down. The lender said, 'Your ducks are in a row, beautiful job, but it's risky and I'm not going to do it,' and that was it. They're going to raze the theater, which just breaks my heart."
Dowagiac is embarking on a process similar to what Niles just completed.
Results of its downtown marketing study were released June 21 by Downtown Professional Network of Batavia, Ill. Niles' study was a free service resulting from its selection as a Michigan Main Street community.
Downtown Niles' primary trade area - including Dowagiac, Buchanan, Berrien Springs and Granger, Ind., as well as Niles - spends almost $70 million on food service and in drinking establishments, but represents "leakage" because it's not being spent downtown in the Berrien County community. Recapturing even 1 percent of that amount would generate $700,000.
Niles also calculated a loss of $35 million in sales of clothing and accessories, but it would need more than one such store to compete with the secondary trade area of South Bend/Mishawaka on those items.
That study also found that the more than 43,000 households in Niles' primary trade area earn median incomes of $50,084, but 42 percent of survey respondents seldom or never shop downtown.
Researchers were surprised to find that only 23 percent of those who do shop downtown felt service was better than at other businesses they patronize.
They are also weaving in strands of information gleaned from Dowagiac's comprehensive plan and new zoning code and an economic development study the city participated in with the county.
The data-driven document that is the end result should "identify opportunities from a retail perspective, from a residential perspective," Nelson said.
Dowagiac's $20,000 downtown market analysis is funded with a Community Development Block Grant (CDBG), so half of the cost will be borne by the State of Michigan.
The comprehensive study will examine business and marketing opportunities in the central business district, including general retail, housing, a movie theater and a "gap analysis" identifying other types of commerce that could be targeted that would likely succeed in Dowagiac.