Chart of the Week: The Rise and Fall of MoviePass
Although MoviePass was founded seven years ago, it’s made some of its biggest headlines over the past year: last August, the company announced its $9.95 Unlimited plan, which allowed subscribers to see one movie in a theater per day per month. By December 2017, MoviePass boasted that it had more than a million paying subscribers, despite concerns about the sustainability of its business model. Unsurprisingly, the company ran into trouble just seven months later, temporarily suspending service on July 26 after its parent company ran out of money and was forced to secure an emergency loan in order to resume operations. With a shaky future ahead – recent reports claim the company is burning through cash at an unsustainable rate – can MoviePass retain both its user base and its bottom line?
Who is Using MoviePass, and When?
Verto Analytics examined MoviePass’s weekly and monthly user base and the demographics of its users (among U.S. adults, ages 18 and above) since the beginning of the year. According to Verto Watch data, MoviePass may be losing users as fast as it gained them. Weekly user traffic to MoviePass rose sharply during the first half of the year, peaking in early May, after the company resurrected its unlimited subscription plan on May 2, following a brief hiatus. While only 733,000 users used MoviePass during the first week of January – a month that racked up a total of 1.4 million monthly users – more than 4 million users accessed MoviePass during the week of May 7 alone, for a total of 6.9 million monthly users in May – nearly a fivefold increase in users since January. But cracks were already showing in the company’s finances: MoviePass reported a $40 million loss in May 2018, and user numbers declined shortly afterwards: in July 2018, MoviePass only claimed 4.9 million monthly users during the month of July, the same month as its July 26 outage.
If MoviePass can’t make money from its primary business model, is advertising its next hope? A look at MoviePass users demographics from July 2018 shows that it attracts some of the audience segments that brands find most lucrative. Millennials comprise 45% of all MoviePass users; in fact, a third of all MoviePass users are between the ages of 25-34 alone.