The price of food and beverages inside multiplexes has become a talking point in Keralam following recent inspections at cinema theatres.
Reports of popcorn being sold for prices ranging from around ₹295 to ₹600 have attracted public attention, along with questions relating to price display, quantity and the availability of free drinking water.
There are several ways to look at this debate: from consumer rights and regulation to operating costs and the economics of running a multiplex. But there is also an interesting branding question hidden inside it: What does a price make customers think about the brand charging it?
The easiest way to evaluate popcorn is to compare its selling price with the cost of corn, oil, seasoning and packaging. But that is rarely how premium pricing works.
Think about a cup of coffee at a local café and another at a five-star hotel. The ingredients may be similar, but the prices can be completely different because the customer at the hotel is not paying only for coffee. The location, ambience, service, comfort and overall experience are also part of the purchase.
The same principle can apply to a multiplex. Popcorn is being consumed as part of a larger entertainment experience involving the theatre environment, technology, seating, air conditioning, location, staff and convenience.
This does not tell us what the “correct” price of popcorn should be. It simply demonstrates an important branding principle: the cost of making something and the value perceived by a customer are not necessarily the same.
Businesses usually think of branding in terms of names, logos, colours, packaging and advertisements. But price communicates too.
A watch priced at ₹2,000 and another priced at ₹2 lakh create very different expectations even before the customer examines them.
This is why being expensive is not automatically a branding problem. Luxury hotels, premium restaurants and high-end fashion brands often deliberately avoid competing on price. Their customers are expected to pay more because the brand promises something more: quality, convenience, exclusivity, service, experience or even status.
The challenge is that the higher the price, the greater the expectation of value. Simply increasing the price cannot make a product premium. Premium pricing works when customers can understand or experience the premium value behind it.
There is a significant difference between a customer saying, “This brand is expensive” and saying, “This brand is unfair.”
Some of the world’s strongest brands are considered expensive, yet customers continue to buy from them because they believe the experience or value justifies the premium.
This is where perceived price fairness becomes important. Two customers can pay exactly the same price for the same product and form completely different opinions.
One person may consider a ₹400 coffee at a luxury resort worthwhile because of the experience, while another may consider it too expensive. The price has not changed; the perceived value has.
For businesses, therefore, the important question is not only whether customers are willing to pay a particular price. It is also how they feel about the brand after paying it.
Multiplexes make this discussion particularly interesting because customers inside a cinema during an interval do not have the same immediate choices available to someone walking through a shopping street.
The Supreme Court has recognised that cinema owners can, subject to applicable laws and regulations, impose conditions concerning outside food and beverages, while also addressing the provision of free hygienic drinking water.
From a branding perspective, this matters because the availability of alternatives can influence how customers perceive a premium. A price willingly chosen among several options may be experienced differently when the customer feels that the available choices are limited.
This does not determine whether a particular price is right or wrong. It simply makes customer perception and transparency even more important.
A multiplex may internally treat ticket sales and food and beverage sales as different revenue streams. Customers may not.
For a family going to the movies, tickets, popcorn, drinks, parking and other expenses eventually become part of one overall experience. They return home thinking either that the outing was worthwhile or that it was not.
The same principle applies elsewhere. A hotel can provide an excellent room but frustrate guests with unexpected charges. An airline can advertise an attractive fare but create a different perception after multiple add-on costs. A restaurant can serve excellent food but leave customers dissatisfied with a confusing bill.
Businesses maintain accounts in separate columns. Customers remember the total experience.
Every business has costs and needs to make a profit. Naturally, an entrepreneur asks, “How much can I charge?” Branding requires one additional question: “What will this price make my customer think about my brand?”
That question is relevant whether you run a multiplex, restaurant, hospital, hotel, salon, retail store or professional service.
If you charge more than competitors, customers will consciously or unconsciously look for the reason. It could be better quality, expertise, service, convenience, ambience, reliability, exclusivity or trust.
A higher price does not automatically create a premium brand. Premium is not simply the price a business puts on a product; it is the value customers associate with paying that price.
₹100, ₹300 or ₹600? That is not the question this article seeks to answer.
Pricing is influenced by business models, operating costs, market positioning, customer preferences and regulation, and the ongoing Keralam debate can be examined from several perspectives.
For entrepreneurs, the more useful question is what their own prices communicate. A business may see margin, while a customer may see quality, convenience, exclusivity, expense or something entirely different.
The business decides the number on the price tag. The customer decides what that number means.
And that may be the most important branding lesson hidden inside a tub of popcorn.
(The author, a business and brand consultant, is a registered trade marks agent.)
