MoviePass’s success highly depends on the number of subscribers that it will attract. Without a big base of users, this platform will definitely fail because it would be impossible to pay theaters for movie tickets.
This phenomenon is widespread in business model research and is called the network effect. It means that there is a direct association between the number of participants and the utility of the service.
Thus, the well-developed business strategy formulated during the preparational period of the project may cause exponential growth rates. As a result, businesses should acquire the so-called critical mass of users to become stable and profitable.
In the case of MoviePass, the network effect can be achieved through proper marketing and informal ties between people. The advertisement campaign can be built on the idea that MoviePass provides the paradigm shift to the technologies of the future.
MoviePass helps to avoid wasting time queuing to buy tickets. Another aspect of people’s engagement in the platform is the ties of friendship or love between people. While many people buy subscriptions to Netflix for their own use, it is rare when people to visit the cinema alone.
Thus, one attracted client can increase the number of users, for example, through the invitation of a loving couple or friends. MoviePass can encourage people to share this platform with others through bonus programs or using referral links.
To attract theaters to the platform, MoviePass needs to explicitly show the benefits of the cooperation. Considering the costs and benefits, theater owners want to be sure that the latter outweighs the former. The external source of benefits, except tickets, is the distribution of food and drinks. In some instances, moviegoers can buy food and drinks for an amount of money higher than the ticket cost.
The best way to encourage people to buy these add-ons is to propose special offers in the application. For example, theaters can give some bonuses and discounts to MoviePass users. It will create incentives for other theaters to join the movement because it will be unprofitable to abstain from MoviePass coverage.