Subscription-based loyalty programs are becoming more and more popular. Lululemon, for example, has just created its first loyalty program using a subscription-based model. In addition, Loyalty360 has spoken with Kobie Marketing on how subscription-based programs can increase retention. We’ve seen lots of success with this model and we think more brands will consider it in the near term.
However, subscription-based programs are not a catch-all solution to revenue problems. MoviePass, for example, is hoping to boost its struggling business by restructuring its program, which has been subscription-based since the beginning. This restructuring includes reintroducing its popular unlimited program. Earlier this month, the subscription service firm introduced three new plans, each offering members three titles each month, to a maximum of 36 titles annually, with prices based on geographic location. The Select plan costs between $10 to $15, with options limited to certain titles, and for certain days. All Access plans are the next level up, while the Red Carpet plan costs between $20 to $25 and includes 3-D or Imax films.
Khalid Itum, EVP of MoviePass, said that the company will also reintroduce an unlimited program that would enable users to see as many movies as they wanted each month. It was a popular choice for MoviePass users in the past, especially after its price was cut to $9.99 a month, but after new restrictions and pricing plans were continuously added, frustrated users started jumping ship.
The company says it has started to regain subscribers and has seen a boost in consumer opinion. Data shows that before the new plans were launched, only 44 percent of customers had a positive feeling towards MoviePass. Last week, that rose to 59 percent. “I feel like we’re turning a corner,” says Itum.
The company has also launched a new advertising campaign, which includes a billboard in Times Square featuring images of moviegoers staring up at a big screen with the tagline “let’s go to the movies.”
“It’s a tribute to our friends in exhibition,” says Itum. “We’re saying that the best place to see a movie is a movie theater. That’s means getting off your couch and going to one. That’s sort of a story of human triumph fulfilled, as well as a story of our company fulfilling our promise to you as a consumer.”
News of the program’s restructuring comes on the heels of an announcement last year that the company was doing financially well. The company was pushing back against comments by some in the theater industry who had predicted its passing. Some of the evidence it offered included its contribution of nearly one-fourth of the domestic box office receipts for the film Blindspotting through the first Tuesday after its release, as well as 13 percent of the opening weekend domestic box office totals for the film Tag.
Overall, the company traced 6 percent of the industry’s total box office receipts to its subscribers. The company argued that, absent its services, exhibitors would fight to preserve profits in a declining box office environment. Many of the problems, it claimed, could be attributed to the unprecedented growth in an extremely new business model.
Subscription-based loyalty programs aren’t for every brand or every consumer. Lululemon and others might be doing well with them, while others might not be doing as well. The kind of loyalty program a brand adopts will depend on that brand’s industry. However, the right combination of price, offering, options, and value can help boost brand loyalty and, ultimately, revenue.