Overview of MoviePass Business Model
The organization of MoviePass which was established in the year of 2011 and was an American subscription-based movie ticketing services which was primarily owned by Helios and Matheson Analytics. The operations of the organization was based on services that allowed the subscribers to purchase up to three tickers per month form a monthly fee. The presented analysis will help in in understanding how capturing network effects from all sided of its platform is vital objective relative to the business operations. The analysis will provide creative recommendations for MoviePass that will help in ensuring efficient as well as effective capture of network effects from platform partners.
The strategy of the organization of MoviePass was based on the overall transformation of its mediating platform in order to bring a shift in theatrical movie going. The strategy of the business was based on switching from the original $40 per month membership fee to $9.95 per month on the bases on the projected total available market to grow substantially which helped in improving its operations and saw an increasing in 11% of avid moviegoers to nearly 7.5 times larger population which also included casual moviegoers (Bigelow and Barney., 2021). The organization of MoviePass had estimate accounted for approximately twice the box office spending with $11.4 billion in ticket spending along with $5-7 billion in concessions such as popcorn and soft drink. The organization saw this as a positive aspect for the consumers, exhibitors and studies as it enhances the popularity of movie going.
The overall business model of the organization of MoviePass effecivelty precited on having the largest subscription bases which would have increased the overall buying power with theaters as well as movie studios. In addition to this, the organization relied on various assumptions based on flat-rate pricing. The business model of the organization was designed as a multisided platform which was established on the base on goals of coordination demand along with moviegoers and theater owners and at last the film studios (Müller, Buliga and Voigt., 2018). This would have helps in the creation of value through an increase in overall attendance. The organization switched from a cross-side network effect which allowed more subscribers and provided the customers with a higher level of buying lower over theaters owners.
The business model of the organization of the business focused on addressing the usual chicken-and-egg problems which consisted of a side of the platform in order to get on board in the initial stage and also decided which features it will offers to each sides in order to effectively reduce the search as well as transactional cost (McDonald and Eisenhardt., 2020). This was vital for the business model of the organization as various platform based business have to overcome the demand that may be imbalanced across sides. This forces the first to end up with a model that is imbalanced in nature and pays more emphasis on one side rather than both. In addition to this, the margin in much lower on one side than the other. Based on the organization which initially charged $40 for its monthly membership fee but later decided to change that to $9.95 as it had decided to get theatergoers on board as its initial step through its aggressive pricing in its business model as the typical moviegoer might find the offer attractive in nature and would successful in attracting a large number of customer base in an optimal manner (Gasparin and et. al., 2021).
Based on the early test relative to the organization of MoviePass showed encouraging results for its $9.99 deal as it was able to operate with 32 locations across the United States and saw a 400% lift in its overall attendance from MoviePass subscription. In tis two market test with projected box office receipts of $10-50 million with a 120% lift in attendance amongst subscribers. The organization was also able to secure a 20% discount from its tickets (De Angelis., 2021). Relative to the business model of the organization it was bale to capture the opportunity on the bases of providing customers with the ability of getting tickets before they sold out and recued the overall waiting time which further enhanced the business model. This part of the MoviePass service had worked as intended as the organization was able to save financial resources when its members booked tickers.
Given below are various creative recommendations for MoviePass in order to ensure effective and efficient capture of network effects from platform partners:
- Provide Solutions For Customer Concerns: In order to develop the ability to capture the network in an effective manner it is essential to provide customers with effective solution in a structured as well as systematic manner. This will allow in the development positive engagement with customers and the business (Burström and et. al., 2021). This will help the organization of MoviePass to develop and enhance its current network effects in order to develop engagement with tis platform partners which will improve its productivity as well as performance.
- Stay Relevant Through Innovation: It is recommended to the organization of MoviePass to say relevant with the utilization of innovative technology in order to provide them the ability to attain competitive advantage in the market relative to its competitors. This will help the organization to ensure that it is able to effectively as well as efficiently capture the network effects from platform partners. This will help in enhancing its operations in an effective manner.
- Be Flexible: It is recommended to the organization of MoviePass to be flexible in nature based on its business model as well as strategy. This is crucial for the business as it will allow in adapting to the new trends in the market along with customer preference. This will help in ensuring that the business is able to adapt to the new trends in order to attain innovation and capture network in an optimal manner (Franco., 2019). In addition to this, it will also provide the organization with the ability to make quick change in its business strategy which will help in attaining completive advantage as well as improving its current business model.
- Snap up Competitors: It is recommended to the organization of MoviePass to evaluate the movement of its competition in order to understand what strategies and business models are utilized by them. This will help the organization to understand how it can beat its competitor in an effective manner and attain higher level of completive advantage in the market. In addition to this, understanding of the competitors and how they are able to capture the market. This will help in development of business strategies as well as models that are aligned with capturing the network effects relative to its platform partners.
- Use Social Media: It is recommended that the organization utilized various social media tools in order to ensure that it is able to capture the network in an effective as well as efficient manner. This is crucial for the business and its strategy as it will help in developing a structured as well as systemic engagement with the customers (Pang and et. al., 2019). In addition to this, it will allow the organization to understand the perspective of the customers based on their changing trends. This will help in developing specific business strategies along with plans that are oriented towards developing products and services that are catered to the needs of the customers. This will help in enhancing its operations in an effective manner as well as ensure that it is able to attain completive advantage in the market thorough structured engagement with customers.
- Encourage Referrals: It is recommended to the organization of MoviePass to encourage referral program in order to improve its network in an effective as well as efficient manner. This will help the organization to grow its customer base in an optimal manner. In addition to this, it will also provide essential support to platform partners as well due to the ability of referral program to engage with customers in a mutual beneficial aspect (Alberti-Alhtaybat, Al-Htaybat and Hutaibat., 2019). This will help in improving the brand awareness of the business in the market and attain higher level of profitability as well as the ability to capture the markets in a structured manner. This is crucial for the business in order to compete in the market in an optimal manner and ensure higher level of growth and success (Yang and et. al.,2020).
- Use search Engine Optimization Techniques: It is recommended to the organization of MoviePass to utilize engine optimization techniques in order to understand the trends in the market as well as understanding the behavior of its customers (Zhu and et. al., 2019). This is important for the business as it will help in engaging with not only customers but with platform partners. In addition to this, it will prove the organization the ability to generate targeted traffic for the organization which will ensure potential customers are targeted in an efficient manner. This will allow in improving the growth of the business as well as its customer base (Valter, Lindgren and Prasad., 2018). Moreover, it will also help in attaining traceable results which will help in develop customer oriented business strategies in order to provide them with suitable products and services which will be adopted by the customers in a positive manner.
References
Books & Journals:
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Pang, C., Wang, Q., Li, Y. and Duan, G., 2019. Integrative capability, business model innovation and performance: Contingent effect of business strategy. European Journal of Innovation Management.
Valter, P., Lindgren, P. and Prasad, R., 2018. Advanced business model innovation supported by artificial intelligence and deep learning. Wireless Personal Communications, 100(1). pp.97-111.
Yang, D., Wei, Z., Shi, H. and Zhao, J., 2020. Market orientation, strategic flexibility and business model innovation. Journal of Business & Industrial Marketing.
Zhu, X., Xiao, Z., Dong, M.C. and Gu, J., 2019. The fit between firms’ open innovation and business model for new product development speed: A contingent perspective. Technovation, 86. pp.75-85.
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