Subscription Pricing Strategy in the Cinema Industry: A Case Study

• Product Research & Development
• Sales & Marketing

A UK-based Private Equity firm with interests in the cinema industry was keen on understanding the role of loyalty programs, including an 'all-you-can-eat' subscription offer. However, they faced significant constraints on their resources, lacking access to sales data, internal staff information, or other marketing material. The firm also wanted to comprehend the impact of ticket pricing on driving footfall and optimizing revenue. The challenge was to gather relevant data and develop a strategy without access to internal resources.

The client in this case study is a UK-based Private Equity firm with portfolio interests in the cinema industry. The firm was interested in understanding the role and impact of loyalty programs, including subscription offers, in their business. They were also keen on understanding the effect of ticket pricing on driving customer footfall and optimizing revenue. However, they faced significant constraints in terms of access to internal resources such as sales data, staff information, and other marketing material. The firm sought the expertise of Iris to gather relevant data and develop a strategy to address their needs.

Iris, a data analysis and strategy development firm, executed a multi-phase project to address the client's needs. The first phase involved web scraping and data analysis. Iris partnered with a firm specializing in web scraping to gather pricing and sales information for a two-week period covering every screening time across major cinema chains. They also identified factors likely to predict price differences, such as local income, population density, and nearest competitor. The second phase involved developing a Customer Relationship Management (CRM) strategy. Iris used digital intelligence, including social listening and website traffic analysis, to map social, search, and website behavior with events and pricing data, assess consumer sentiment through social channels, and analyze promotion trends versus competitors. The final phase was strategy development. Using their experience with loyalty and subscription-based pricing, Iris developed recommendations and a roadmap for the client. They developed strategy-driven loyalty offerings, including subscription-based pricing and identified gaps in existing loyalty offers. They also identified trends in the existing market for ticket pricing and opportunities to target 'Pay-As-You-Go' ticket prices for quick wins and longer-term considerations for an unlimited subscription model.

• The operational results of the project were significant. Iris was able to gather relevant data and develop a comprehensive strategy for the client despite the lack of access to internal resources. They identified key factors that could predict price differences and used digital intelligence to understand consumer sentiment and promotion trends. They also developed a CRM strategy and provided recommendations for the client. The strategy included developing loyalty offerings, identifying gaps in existing loyalty offers, and identifying trends in ticket pricing. This comprehensive approach allowed the client to understand the role of loyalty programs and ticket pricing in their business and provided them with a roadmap for future strategy development.