It’s easy enough to come up with the next big idea. Whether it’s inspiration for a small start-up or a global company, these innovators strive to grow success from their game-changing ideas. However, good ideas alone don’t guarantee success (at least not in the long-term). People and society are always changing. The trick for a brand is to adapt their product or business model to these changes. If you don’t, you risk being left behind. An example of this is the rise and fall of MoviePass, a pioneer of subscription-based movie services.
The idea of a buying movie tickets through a Netflix-like subscription was new and exciting. Initially rolled out in July 2011, MoviePass reached its peak in late 2017 when it promised users a compelling offer: one movie ticket per day for only a monthly fee of $9.95. The service received over 150,000 sign-ups in two days.¹ People were tired of the $10+ movie tickets and MoviePass seemed to answer that need. However, various glitches and delivery delays of membership cards were small signs of what was to come less than a year later.
In July 2018, MoviePass users were confused when they could not purchase any movie tickets. The company had turned off their service because they could not pay the bills. After getting a $5 million loan, MoviePass announced that the monthly fee would be increased to $14.95 and available movie screenings would be significantly decreased. While they eventually backed down on the price increase amid backlash, users were still limited to only three movies a month with only six movies available each day. These changes were not received well by users as the company lost $130 million and suffered a “significant decline” in subscribers in their last quarter.¹ MoviePass’ original idea was tarnished ultimately by promising too much to users without being able to follow through. While MoviePass is trying to bounce back,² the move may be too late. Other competitors have already rolled out their own movie subscription services, and they have likely learned from MoviePass’ mistakes.
One of the first brands to build upon MoviePass’ success was theater powerhouse AMC. In June 2018, AMC announced a plan that permitted users to see three movies a week for a monthly fee of $19.95. While this plan was more expensive, it also included other perks like access to IMAX and Dolby films and AMC’s rewards program.³ Sinemia also announced its movie subscription service that allowed users to see three movies per month for only $9.99 a month. However, Sinemia allowed users to buy tickets in advance whereas MoviePass users had to buy tickets same-day at the theater. Other options also include IMAX and 3D movies, which were not available in MoviePass’ plan.⁴ Just earlier this month, Studio Movie Grill began its own service that included multiple plans starting at $14.99 per month.⁵
The rise and fall of MoviePass serves as a prime example of a brand adapting to the needs of its audiences initially but not being able to keep up in the long-term. With every change MoviePass made to try to save its business, they lost customers to competitors who were more realistic in their goals. While it’s important to listen to your consumers, it’s even more important to be flexible. Being able to adapt to the marketplace without sacrificing your longevity is key for successfully growing your business.
Sources:
¹ https://www.nytimes.com/2018/07/31/movies/moviepass-timeline.html
² https://www.nytimes.com/2018/12/05/business/media/moviepass-subscription-plan.html?module=inline
³ https://www.nytimes.com/2018/06/20/movies/amc-subscription-service-moviepass.html?module=inline
