EXCLUSIVE: Cinemark’s Movie Club, the first subscription program backed by an exhibitor, has surpassed 350,000 active members, the company said today. CEO Mark Zoradi tells Deadline that MoviePass deserves at least a smidgen of the credit for the rapid growth.
The industry knives are out for MoviePass, whose chaotic 2018 that has prompted industry concerns about its potential to sour millions on moviegoing if it is forced to shutter. On this point, Zoradi differs notably from AMC CEO Adam Aron, who has publicly sparred with the startup in recent months, deriding its model as unsustainable. “I take the more upbeat view” on the impact of MoviePass, Zoradi said. “It has helped create awareness of subscription moviegoing.”
Movie Club differs from MoviePass — and AMC’s recently launched Stubs A-List — in significant ways. For $9 a month, it offers members one free movie, plus discounts on guest tickets, concessions and other bonuses.
Cinemark, the No. 3 U.S. exhibitor, sees the club as a basic customer lure in a delicate moment for moviegoing given the proliferation of other entertainment options. About 45% of Movie Club members were not previously part of the exhibitor’s existing loyalty program, and their spending now accounts for about 6% of percent of total box office at Cinemark. The circuit this morning posted record revenue in its second quarter and strong profit figures due to a surge of spring and summer attendance.
Unlike other plans, Movie Club members retain their credits indefinitely — if they cancel, they can still use the credits for up to six months, Unused credits in a given month roll into future months. Even so, 75% of credits given since redemption have been redeemed.
Zoradi, who came to Cinemark in 2015 from an international executive role at Disney, witnessed first-hand the popularity of subscriptions in the UK and France. In February 2017 — months before MoviePass launched its unlimited plan, he notes — he led an internal team developing Movie Club. The aim was to not only draw from the successful overseas plans but also to take a cue from the services customers interact with in their day-to-day life, including mobile phone plans, video streaming, gyms and e-commerce.
In testing Movie Club, “what we found was the broad group of moviegoers — those who go to movies one or two times month — was who we wanted to go after.” MoviePass, by comparison, initially aimed for avid moviegoers, one reason for its cash shortfall, though it recently scaled back to three films for $10 a month, a setup it now says addresses 85% of its membership.
Zoradi does not rule out possibly adding a more expensive tier for heavier moviegoers down the line. But by keeping the initial ambitions fairly modest — “we didn’t really reinvent the wheel,” the CEO says — Cinemark found that it learned to stimulate more appetite for ticket buying. “People are telling us they want to go four to six times more per year than non-members do,” he said.
One key, influenced by the millennial members of the Cinemark team, was trying to create an easy route to signing up and canceling a membership via the app. “We took all the friction out of the moviegoing process,” Zoradi said. “What we wanted to do was take away the fine print or red tape.”
At the same time, harvesting broad consumer data (such as restaurant or ride-share preferences of moviegoers) isn’t the end goal, as it is for MoviePass, Zoradi says. “We’re not looking to sell the data,” he said. “We’re looking to husband the data. … We’re not in the business of peddling it.”