Do you have MoviePass? I do and I think it’s fabulous. For roughly $10 a month (about the cost of a ticket here) you can go see one movie a day as long as they’re not IMAX or 3D. Too good to be true? It really seems that way but I’ve never had an issue using it.
You might be asking yourself how do they stay in business? Lots of other folks are asking the same question since I gather they have to pay the theater the full price of admission when you use the pass. I go to an average of one movie a week (4/month) which I gather from this article on Recode is more than average. They’re recently starting charging a premium if you want to see a very popular movie right as it’s released, but that’s a minority of what’s out there. Still, they must be losing money on most users so how do they stay in business?
In a word, data. I go to see some movies in the theater that I might ordinarily wait to see on pay cable or via streaming. I often hit the concession stand, which is where the theaters make most of their profit. Good deal for them, right? Where Moviepass is thinking they’ll make their profit is from understanding the moviegoer and selling that data. That’s why they’re so inexpensive – to scale quickly – and they’re hoping to become so ubiquitous that they end up getting a cut of the increased attendance they are generating (the 3 extra trips to the theater I make in a month!). With me so far?
A friend of mine also has a Moviepass that she was given as a gift. Her 6-month gift ran out the other day and she went to renew. Here is where the fun begins and where we all can learn a little something. There is no way to renew a gift subscription. Seriously. She wanted to convert the gift to a regular subscription on her own credit card and Moviepass won’t let her. Instead, they require that you start all over and create a new account using a different email. Let’s think about how many things are wrong here.
First, you’re a data company. By demanding an existing customer start all over, you’re blowing off all the data you’ve collected on them to date. Second, since Moviepass requires a physical card to work, you now must issue a new card. Besides being an expense for you (create the card, ship the card, etc.) it’s extremely inconvenient for the customer. Third, I’m anticipating that since an account is married to a device, there will be an issue when she gets her new account and tries to tie it to her existing phone. You can’t use your pass without using the app and the app is tied to a device and your card. There isn’t a single reason I can think of that makes this a smart policy.
This silliness has forced many customers to reach out for customer service (a cost!) and from the heated postings on Facebook, Reddit, Twitter and elsewhere, it’s resulted in a lot of lost business for Moviepass. One of the main advantages of the digital world is how there is far less friction in many transactions. Online commerce brings your shopping to you and you never leave the house to lug stuff home unless you care to. Moviepass seems to have found a way to increase friction among its existing customer base – those who received gifts and want to remain as customers. Not very smart in my book. Yours?
Filed under Consulting, Huh?
Have you heard about the Build-A-Bear fiasco? Build-A-Bear Workshop declared last Thursday “Pay Your Age Day.” Customers could come in and build a bear at its workshops across the U.S., Canada and the U.K. for the price of their age rather than the $50+ it normally costs. Not a bad deal if you’re an 8-year-old or even a 35-year-old parent. The response was overwhelming, with mile-long lines in some places. According to The Washington Post, some waits were seven hours long.
It’s great that there is a large, enthusiastic audience wanting to build these bears, but that’s about the only ray of sunshine here. Some stores gave customers who were turned away a $15 voucher. As a parent, I can tell you that the voucher does little to placate a disappointed child. They were counting on a new furry friend. Many of the ones turned away were members of their Bonus Club, a frequent buyer program, already and others had to join to get the discount. In other words, their best customers. Yikes!
The CEO went on TV and said: “There was no way for us to have estimated the kind of impact, those kind of crowds.” He added, “We did put a notice out for people that we thought the lines could be long, and we worked with the malls, but it was beyond anything we could’ve ever imagined.”
That’s the point for any of us who run promotions. You need to imagine what an overwhelming response will do to your operation. In this case, maybe they should have had people sign up to take advantage of the promotion in advance (and get their emails as a bonus) to get places in the line, much as one does at a concert to get in “the pit”. Maybe extend the promotion for a few days to let those people into the store at predetermined times. Heck, maybe take space in unrented stores in the mall and add capacity. Be creative, consider lifetime customer value, and spend what you need to in order to prevent a disaster.
No good deed may go unpunished and companies that disappoint their best customers rarely go unpunished as well. You with me?
Filed under Consulting, Huh?
Happy Foodie Friday! There’s been a food-related story making the headlines this week and I think it reflects something that can be useful to any of us in business. The founder and chairman of Papa Johns Pizza had to step down this week after he admitted to using the N-word in a company conference call. It has sparked a public relations crisis and it’s not the first one his actions have caused. You might remember that he also weighed in on the controversy surrounding NFL players and their kneeling during the national anthem. While he certainly wasn’t the first sponsor to criticize a league, doing so over an issue that went way beyond the league itself resulted in a public relations issue for the brand.
While I’ve never been a fan of Papa John’s pizza, his bad behavior made me all the more certain I’d never eat it again. One person whose food I am a fan of is Mario Batali. Even so, I’ll not be going to any restaurant associated with him. His bad behavior caused him to “step back” from his restaurant empire following the first public allegations of sexual misconduct. That was followed up by a 60 Minutes story. Even so, he hadn’t completely divested himself of a financial interest, and that certainly affected the brand, so much so that three of his restaurants on the Las Vegas Strip are set to close even though they were doing well. The local partner in these restaurants, Las Vegas Sands Corp., decided to end the relationship with Batali’s organization.
Why do I bring this up? Because every one of us in business is a celebrity on some level. We might be nationally known or maybe it’s just our customers, partners or employees who consider us famous. Our actions can enhance or damage our personal and corporate brands every day and we need to remember that no incident remains quiet or hidden for very long. Nearly every person is holding a camera and a video recorder in their hands and bad behavior rarely goes unnoticed or unpublicized.
There was a restaurant I patronized on a regular basis. The food was OK if unextraordinary, the prices were reasonable but the owner was a great guy. I loved spending a little while with him every time I went and I kept going back because he took great care of me as well as did good things in our community. We are our brands, and how we act can damage that brand as badly as a misplaced ad or a faulty product. Enjoy your weekend!
Foodie Friday, and today we’re having a think about the food of the future. I don’t think it’s news to anyone who pays the least bit of attention to the world that humankind’s ability to support itself is in peril. CNN said it well:
We’ve gotten ourselves into some trouble. Our dining habits are a big part of the problem. The average American male consumes 100 grams of protein daily — almost double the necessary amount. This overconsumption isn’t sustainable. The United Nations projects food production will need to increase as much as 70% by 2050 to feed an extra 2.5 billion people. To survive, we need to reinvent the way we farm and eat.
Exactly, except that some of that reinvention, while packed with nutrition, is…well…gross. I know that I’m applying my American diet standards here but how would you describe eating bugs or algae? We have plenty of both, both are sustainable sources of protein, and both reduce the impact we’re having on our planet. Cricket anyone (and I don’t mean the game!)? How about a nice plate of nannochloropsis?
There’s a great business lesson in this. To understand it, let’s look at another food that was once anathema to most Americans: the tomato. That’s right. Until the early 1800’s, the tomato was grown purely for decoration in this country because it was considered poisonous. What happened to change its reputation and make it a mainstay of our diet? There are several theories, including one involving Thomas Jefferson’s promotion of dishes using the tomato. I think it has to do with immigration and the fact that European immigrants used the fruit (you know it’s a fruit, right?) in their cooking. Whatever it was, people overcame their fears and began consuming tomatoes en masse.
If I were marketing bugs and slime (OK, it will probably be protein derived from those things made into other food products), I’d do a few things. First, I wouldn’t deny that there might just be a perception problem. No brand can deny its past. I would aggressively try to control the conversation and the message. That means a lot of marketing, especially through influencers and social channels. I’d research the heck out of consumer attitudes on a continual basis and I’d avoid making emotional responses to misperceptions, focusing on the data. Mostly, I’d do everything I could to get the products sampled and I’d use the testimonials along with the overall message that these products are saving the planet by decreasing the need to rely on other protein forms that are inefficient at least and detrimental at worst to the environment.
When I was a kid, the notion of eating raw fish in this country was nonexistent. I’ll bet many of you did just that this past week. There just might be a bug in your future once some smart marketers get to work. What do you think?