Santikos: A Legacy of Innovation

by | Feb 16, 2023 | Outside The Box, Sports/Entertainment

Featuring Rob Lehman, Santikos Entertainment

Rob Lehman, Chief Operating Officer of Santikos Entertainment, talks about its 100+ year history of using innovative tech to enhance the moviegoer’s experience. Lehman explains why he became an early adopter of Apex Smart Food Lockers and his multi-phased approach for expanding digital ordering and pickup.

Rochelle Hi everyone, and welcome to Outside the Box, where we talk about all things innovation in order pickup.

Rochelle Hi, everyone. I’m Rochelle Berry with Apex Order Pickup. And today I am here with Rob Lehman, COO of Santikos Entertainment. Rob, thank you so much for joining us.

Rob Thank you for having me.

Rochelle I’m going to start real simply and ask you just to introduce yourself and talk a little bit about your professional journey.

Rob Sure. So my name’s Rob Lehman. I’ve been in the theater industry for about 30 years now. Hard to believe I came out of college looking for a job and found a manager trainee position for a theater chain in the Midwest called to the theaters. They hired me and I’ve been in the theater industry ever since. I got an opportunity to come in and direct Santikos Entertainment as vice president of operations. And within a year I was named COO. So it’s a crazy journey after 30 years plus starting as a theater manager trainee. And I never thought I’d be 30 years later doing what I’m doing.

Rochelle So I did a little research on it, Rob, and I saw that you won the Bert Nathan Memorial Award in 2021. So your leadership and passion definitely shined through there. Can you talk a little bit about that?

Rob Yeah, that was given to me by the National Association of Concessionaires, NAC, I’ve been a member for 25-plus years with them. It was a great honor to get it was given to me by my peers in the industry. Really what it was during that timeframe of COVID and what how we reacted as a company. I did a lot of Zoom calls back then, walking people through. We were the first theater chain to reopen after our governor said some places can reopen.

So we created a lot of the processes and NAC asked me to do a lot of Zoom calls. And it was I gave a lot of advice, talked to a lot of different theater owners, concession people, and it was a great honor to give.

Rochelle I am sure it sounds like, you know, there are a lot of people looking for that leadership, especially during that time. And I’ve heard, of course, through Apex how innovative Santikos has been with your leadership. And I want to dive into that a little bit more.

Rochelle I think you should be very proud of your success and your recognition. So congratulations. So let’s talk a little bit about Santikos in particular and the journey Santikos has been on. I know you touched on that a little bit, but especially over the last, let’s say, decade or so and how COVID also played a role in some of your innovations.

Rob Sure. You know, Santikos started in 1911 with the Santikos family, and John Santikos took over for his dad. And then, unfortunately, John passed away at the end of 2014. And we had ten theaters at the time. Unfortunately, I never met Mr. Santikos. There’s people here at the office that have some great stories about him. And it was a, innovation was always something that he was passionate about.

You know, when I came here in early 2017, they have two of the biggest theaters I’ve never set foot in and I’ve been in a lot of theaters, two of them over 100,000-quare-foot. Facilities called Palladium and also Casablanca. So he always thought big. And so something you need to know Mr. Santikos did when he passed away, he gave his company and real estate, we’re also a real estate company, to the San Antonio Area Foundation. And the Foundation gets benefit from us making money. And so we give all our profits back to the community through the Area Foundation. And they distribute them throughout all of San Antonio and the surrounding towns.

So that’s a very unique business model. There’s not too many businesses we’ve only found one or two other in the in the nation that have this type of arrangement with a not-for-profit association. But we’re a for-profit company, so we’re still looking for how to make the most money we can, and do a thing business that’s very good.

Rochelle That’s amazing. Well how is the community how are the funds spent within the community?

Rob So through the Area Foundation, Santikos we have nothing, we just we provide the money to a fund and they grab that money from the fund and they’ll give it away. Mr. Santikos asked, he had eight areas of interest that he would like the money to be used for so providing for parks and recreation. So when you go around San Antonio, you’re going to see a lot of John L. Santikos basketball court and John L. Santikos baseball. We give money to the colleges, universities, hospitals. So John’s name is all over this town and the community really responds to him.

You know, we’re really like a community theater when you look at it, community group theater, entertainment complex. So it’s a it’s a top message for our marketing team to get out there and say, you know, all your profits go to it but the community really likes us and they show up at the theaters and we have the largest market share. So people respond really well to what our messaging and our mission is for the community.

Rochelle So thinking about the profitability and giving back to the community, let’s go back to the roots of the operation and some of the innovations that you were, you know, really having to keep up from both labor and revenue. So especially when COVID hit, how did you manage that?

Rob You know, the whole time with Mr. Santikos one of our pillars is innovation. And so what we’ve seen in the cinema industry used to be film projectors and digital projectors, and then, you know, an old sound system. Now it’s Dolby Atmos Systems. And, you know, the old traditional just movies, popcorn, soda, and candy has just exploded. Now it’s, you know, if you want a beer or a cocktail, do you want a hamburger.

Rochelle Awesome. And how did the lockers fit in there?

Rob Well, so the lockers kind of get you from when I came in here in 2017, I didn’t have a lot of theaters in my past that had extensive menus. So burgers, pizzas, chicken sandwich, French fries, you know, eight appetizers, salads. And what I was experiencing when I got here with my food and beverage background was the poor kids who were trying to pass out food that someone would order at the concession stand, say, okay, go over to that area over there, and in about 10 minutes, wait for your number to be called.

Well, on a busy Saturday night of The Avengers movie or something, the poor kids that were over there, like looking at all the food, is just coming out of the kitchen and they’re like, okay, match this up with this and order one, two, three, four. And you got 15 people surrounding trying to get through to go get their food. And I was just like, Oh, this is this is not working.

So a good friend of mine in the industry, I was telling him about it sometime and he sent me a link to the Apex system that was installed at it was called Riverfront Stadium. I used to live in that area. But whatever the stadium is in Cincinnati.

Rochelle Oh, yeah.

Rob And they had this they had this locker set up, and I’m like, That’s interesting. So I reached out to the Apex team and started those conversations with them and told them what my problem was happening here. And so we started testing. They brought down a machine and put it at our busiest theater, and ever since then the journey has been absolutely outstanding. Our customers love that experience. We love it. It’s put it in, the expo person can just put it in the into the locker, hit a number and it automatically sends a signal to the customer, the text message, and then they open it up and grab it themselves and that person’s back grabbing the next order and going back and forth.

So I look at that as a no one in the industry, theater industry, had Apex and or once again, I think I, I believe I made Mr. Santikos proud that we found a system that continues its trait of innovation and that’s something he wanted, and Apex has just been a perfect example of that technology.

Rob You know, when we first got into Apex with the 2018, when it started here at Santikos, I kind of looked at it as a four phase way of utilizing their system. And the first phase was just getting in front of the customers so they could see this new technology interact with it, get their orders out. It helped our employees with saving labor, getting accuracy of orders, like I mentioned.

The second part was, using the dashboards, which we talked about. How do we always working with Apex to say, Hey, we need some help here, we need some help there and working with them. The third phase is we just kicked it off late last year. It was kiosk order. So you walk into our theater and you’re going to buy your tickets at a kiosk. And now what we do is say, Hey, would you like to buy your concession, too? So we go into that kiosk and then they go, Yes, I want a cheeseburger, I want a soda, and I want a popcorn. The great thing about it is that would be printed out back in the kitchen.

And now what we’re doing is we’re using Apex to take since we have, as I mentioned, self-serve popcorn warmers and self-serve drinks with the Coke Freestyle, we’re putting those empty tubs and drink cups in the Apex system for the first time along with your cheeseburger. And then we’re letting you know, so when the order comes, you scan it, the door opens, you’re grabbing your tub, your drink cup, and your cheeseburger, and you’re going to fill it up. So that’s been a complete change that allows the customer to just do it. And they don’t have to go stand in line at the concession stand.

And the last phase that we’re looking at is we want to say, during those slow times that I mentioned, that maybe we don’t open our concession stand at all. And when you walk into our theater, we have a theater ambassador there who says welcome, you can buy your tickets here. You can buy your concession here. And then we take the concession out of play for three, 4 hours. And I just have someone working the Apex food locker system both on and off with drink cups and popcorn tubs and candy and cheeseburgers.

So I continue to develop what we’re trying to do with Apex. But it’s been it’s been a journey. COVID slowed us down, but we’re back, and I’m enjoying working with the Apex team to take that to, you know, I don’t know what the phase five will be, but I think there’s going to be a phase five. So I’m really excited about the next journey that we’re on with phase four.

Rochelle Oh, I’m sure the customers appreciate it. And I’m, I would think that your young workers are just like, That takes a load off, right? Just nobody wants to screw up. And I remember working at a young age and being overwhelmed in the food industry as a server. And yeah, I mean, so stressful for a 16, 17, 18 year old young person just trying to keep up and stay upbeat in the customer service industry.

Rob Exactly. I think one of the other things too, is the accuracy of orders. If someone didn’t want onions on their cheeseburger and their wife wanted to have with everything on it, the kids are going to get confused now because it’s just like this goes into that order. And if they don’t misinterpret and give someone who someone gets onions that didn’t ask for them. So it just the accuracy and put it in the right locker and letting the locker system do what it needs to do is what’s been great for us.

Rochelle Right? So less waste, I would think.

Rob Less waste, less mistakes. And then there’s some labor savings. We always debate how much labor savings there is, but for the kids to the expo to grab what they need to put it in the locker, send the signal and go back and do a thing instead of standing there and reading out orders is, there’s labor savings there, for sure.

Rochelle Yeah. And more efficiency with what they’re doing and more focused efforts that way. So are you able to get some data from using this technology?

Rob Yeah. So we created an internal dashboard and we know how many times, we break it down so twice a week we’ll look at weekend numbers, Friday, Saturday, Sunday, and then we’ll look at the whole week and we look at it by hour and say, okay, how many orders went to the kitchen? And then we can look at how many customers came through the theater and we can look at some data on that and make some determinations.

So last fall, we were looking at some of the data and some of the slower, you know, September, some of the slower times in the theater industry, we’re looking at it to say, okay, do we need to open our kitchens? Usually our theaters will open at 12:00. Do we need to open up our kitchens at certain theaters at 12:00 because over the last month, we averaged two orders in that first hour or eight orders in the first 3 hours.

Well, you think about it. You got someone coming in 2 hours prior to set up the kitchen and you got someone else coming in. So before you know it, you’ve got a team of three sitting there for eight orders on a slow day. So what we’re doing is we’ve got a year’s worth of data now. And as we start going into slow times of the year, we’re going to pull that data from last year. We’re going to look at our forecast team and say, okay, does it make sense to open that kitchen at 2:00?

So the data is there. You just got to go get it and then you got to analyze it and analyze it. We do a lot of analyzing data around here and say, okay, does it make sense? And then once again. We might come back and say, you know what? It’s about the customer having that ability to sell that cheeseburger to them at 1:00 so we don’t shut down operation or the kitchen during that time. So that’s the great thing about getting the data that we’re getting from the Apex system and allowing us to always tweak things where necessary.

Rochelle That’s great. What’s next for Santikos? What do you think is on the whether, well, let’s talk about the industry first. What’s next for the industry that you’re either going to lead or be reactive to?

Rob I think keeping ideas open. Thinking outside the box. I do a lot of reading. I do. I see news stories. I jump into it. I’ll use the perfect example. When I was talking to some of Apex people last week when they came to visit me. There’s a Taco Bell in Minnesota that did a new building design when they put the kitchen on the second level and they’re literally using food elevators, I guess as their called, to drop food down to the second and third drive thru stations. And I looked at that and immediately I and I heard about it and I did a lot of research on it and I’m like, okay, how do I take that technology and put it into our technology and what we do on the theaters?

So I have some ideas in the future that as we’re expanding and Santikos is expanding and maybe doing something similar to that, but I’m always kicking around ideas. The industry is always changing. We build the digital projectors. That’s over. For me, I’m looking for food and beverage is where you make your money. So how can we go faster in that area, speed of service and sell more food and make it a customer journey that includes Apex, that includes grab and go candy, self-serve popcorn warmers. So that’s a that’s the type of stuff I’m looking for, and who knows what’s next?

Rochelle Yeah, well, I can’t wait to follow that. You know, I think there’s no better date night than dinner and a movie. So that still it’s not cliche. I think that’s a real thing. It’s a great time to be entertained, let loose, have some good food. And I love that the theaters are now serving food and drinks. I think that it having that kind of not that it’s all inclusive, you know, it’s still a la carte but hey, maybe that’s next, right? Packaged up. But Rob, I have to let you go. But this was just such a great chat and I wish you all the best and congratulations on your success and we’ll continue to follow you.

Rob All right. I appreciate it. Thank very much.