With its subscription-based model, MoviePass is poised to revolutionize the viewing habits of movie-goers — and collect a treasure trove of consumer data in the process.

This past August, MoviePass — a new service that gives cinephiles virtually unlimited access to movie tickets at a flat monthly rate — sold a majority stake to data analytics firm Helios & Matheson. In the same month, they lowered their month-to-month subscription cost from $49.95 to $9.95, which makes the service a major bargain in urban markets where the cost of a movie ticket can cost nearly $20.

MoviePass has proven its viability by getting customers to the movies with money to spare for dinner, drinks, and concessions — but what does the service hope to accomplish in the long-term?

Consolidated Targeted Advertising

MoviePass needs to show it can increase revenue for movie theaters, but its end game is far more ambitious. If the subscription service can fill theaters with customers (a lot of customers), it’ll have access to a treasure trove of data — namely, what movies you’re seeing, when you’re seeing them, and where.

This information promises to be just as valuable as the initial revenue stream MoviePass claims it can deliver. Data explaining mass moviegoing habits would be a golden ticket for Hollywood, and personalized ads based on users’ viewing history might one day make the difference between a flop and a hit.

Meanwhile, the “when” and “where” may soon give local businesses an opportunity to attract new customers. According to the CEOs of MoviePass and Helios & Matheson, MoviePass plans to partner with businesses, restaurants, and bars to serve relevant ads and promotions directly to nearby users. Since the service requires that users be near a theater before checking in and grabbing their tickets, the app can pinpoint your geographic location and send real-time recommendations for what to see, eat, and do in the area.

But MoviePass wouldn’t stop there. By partnering with ride-sharing apps like Uber, they hope to one day consolidate the total MoviePass experience into a single monthly bill. Imagine: dinner, drinks, movie, concessions, dessert, and a ride home — all wrapped up neatly in one little app.

Staying Power

Right now, MoviePass is operating at a loss. That’s not surprising considering they pay theaters the full cost of every ticket purchased through the app, even though customers are only paying $9.95 a month for the service (that’s less than the cost of a single movie ticket in most areas).

The challenge for the company is to weather these early losses, and stay in business long enough to amass a user base numbering in the millions. That number is currently hovering around 600,000, but the company expects to add more than 3 million subscribers within the next year. When MoviePass hits that kind of critical mass, targeted advertising on the app is going to have some pretty incredible potential.

Beyond the practical applications, this data paves the way for countless creative possibilities — think of the treasure troves of user data at Netflix’s and Spotify’s disposal, which have been used to fuel a series of clever and highly memorable ads.

It may not be long before serious competitors come out of the woodwork, clamoring for their own piece of the cinematic pie. Cinemark, for one, has already launched its own “Movie Club.” And while its member perks don’t quite stack up to the benefits of MoviePass, the simple fact of its existence serves as an indication that subscription services have a future in the mainstream movie theater circuit. Even AMC, which has vocalized its discontent with MoviePass, may have had ulterior motives: the theater chain is rumored to have been in the process of developing a subscription service of its own.

If MoviePass can get several million users signed up within the next year, it may have a shot at long-term success. That means that advertisers will have a new, highly targeted channel through which to reach millions of tuned-in customers. Are you ready to meet them?

Longneck and Thunderfoot offers content marketing services and strategies to transform your company blog into an authoritative trade publication. Click to learn more about how to produce great content and prove ROI on your marketing efforts.

Author Jake Dawe

Jake works with our clients and L&T's content management team to create and publish cogent, effective marketing content. A recent graduate of Yale University with a B.A. in American Studies, Jake pursued independent research that traced the evolving voice of ``Shouts and Murmurs`` over ninety years. When he's not writing and editing, Jake is probably watching The Crown or making up for four years of lost pleasure reading. Thanks, college.

More posts by Jake Dawe