Why Amazon would buy a movie theater

A Landmark Theatres location in Manhattan.Yelp/June S.

• Amazon is reportedly in the running to purchase Landmark Theatres, a small chain of movie theaters that primarily show independent and foreign films, Bloomberg reported Thursday.
• Owning Landmark would give Amazon another physical space to connect with customers, according to GBH Insights’ Daniel Ives.
• A purchase could be another sign that Amazon is looking outside its traditional growth area — customers’ homes — to grow sales and Prime memberships.

Amazon might be looking to make a mark at the films.

The retailer, known for its vast product selection and fast, free shipping, is reportedly looking to purchase Landmark Theatres, according to a Bloomberg report from Thursday.

Landmark is a small chain as far as movie theaters go, with 56 locations around the country. It focuses on niche interests, like independent and foreign films. It does have a good reputation among moviegoers, and it describes itself as “upscale.”

Sound like another brick-and-mortar retailer Amazon recently purchased? The Washington Post called Landmark the “Whole Foods of movie chains.”

Neither Amazon nor Landmark responded to Business Insider’s requests for comment. 

At first blush, Amazon buying a chain of movie theaters might not make a whole lot of sense. Isn’t Amazon mostly focused on the home, with its myriad delivery options and home-automation-enabling Alexa devices?

Sure, but Amazon isn’t a company that shies away from growth. As far as the acquisitions Amazon has made in recent years, some are obvious — like Ring, the smart-doorbell maker — and some are more focused on the “longer term,” according to Daniel Ives, chief strategy officer and head of technology research at GBH Insights.

With a movie theater, Amazon would move one step further into physical retail, creating “valuable touch points” in the real world for customers to interact with. Think: screenings for Amazon Studios films and films or events for Prime members. 

It’s just another way for Amazon to “entrench in [customers’] daily lives,” Ives said to Business Insider.

Much like Amazon is giving Prime members perks at Whole Foods, the same thing could be done for a movie theater, perhaps via perks like free or discounted films and concessions.

“Brick and mortar gives another opportunity to expand Prime membership,” Ives said.

Owning a chain of theaters also makes sense as content becomes a larger focus for Amazon in its competition with Netflix and HBO. Prime Video content is already a major driver of Prime subscriptions, though it obviously lags behind the shipping perks. Having a dedicated place to distribute content in the real world, and making it eligible for prestigious awards like Oscars, could become more important.