Unlocking Entertainment Experiences with FestivalPass
Subscription-based business models have gained significant popularity in recent years, offering consumers access to a wide range of services and products for a fixed monthly fee. Two notable examples in the entertainment industry are MoviePass and FestivalPass, which offer unique approaches to subscription-based access to movies and events, respectively. However, their divergent strategies and outcomes tell a compelling story about the challenges and opportunities associated with subscription models.
MoviePass, which provided unlimited movie access for a monthly subscription fee, underwent a rapid ascent in popularity, only to experience a sudden decline due to various factors associated with its rapid expansion.
FestivalPass, led by a MoviePass executive, opted for a different approach, offering event access through an in-house currency system. Let’s explore the rise and fall of MoviePass, the innovative approach of FestivalPass, and the lessons that can be drawn from their experiences.
Three of my favorite things about FestivalPass:
No ticket fees.
Obtaining a Lifetime Membership, which I've acquired, provides access to $1200 worth of annual ticketed events for a single payment of $2000. I appreciate this strategy of fostering adoption and evangelism by leveraging its user community instead of relying on a traditional PR team.
Enjoy exclusive benefits at SXSW and various festivals, including opportunities to interact with the artists I admire and receive special privileges, all included in the price of a standard ticket by buying with FestivalPass.
History Lesson: The Rise and Fall of MoviePass
MoviePass, founded in 2011, entered the market with a bold and ambitious vision – to revolutionize how people watch movies by offering unlimited access to theaters for a monthly subscription fee. At its peak, MoviePass allowed subscribers to watch one movie daily for a monthly fee of $9.95. The concept appealed immensely to moviegoers, and the company quickly amassed millions of subscribers.
MoviePass utilized a subscription model that aimed to disrupt the traditional theater industry. MoviePass attracted a large user base by offering a low monthly fee and achieved rapid growth. The company negotiated partnerships with theaters, allowing subscribers to use their MoviePass cards to purchase tickets at most theaters across the United States. This strategy initially led to a surge in movie ticket sales as subscribers took advantage of the seemingly unbeatable deal.
However, MoviePass's meteoric rise was unsustainable. The fundamental flaw in its business model became evident as it struggled to cover the costs of subsidizing movie tickets for its subscribers. MoviePass paid theaters the full price of each ticket, often exceeding the monthly subscription fee. This created a significant financial burden that MoviePass could not sustain in the long run. The company found itself hemorrhaging money with no viable path to profitability.
MoviePass's financial instability led to frequent changes in its subscription terms and a series of desperate attempts to cut costs. These changes alienated and frustrated subscribers, eroding their trust in the service. MoviePass's inability to secure additional funding and its mounting financial losses ultimately led to its bankruptcy in September 2019.
The FestivalPass Approach
While MoviePass served as a cautionary tale about the challenges of unlimited access subscription models, FestivalPass took a different approach to the entertainment subscription market. Established in 2018 by a former MoviePass executive who served as their Interim Chief Data Officer, FestivalPass demonstrated a keen awareness of the significance of sustainability and subsequently adjusted its business model to reflect this awareness.
FestivalPass provides access to various events through a subscription-based system, including concerts, festivals, and live performances. Instead of offering unlimited access, FestivalPass employs an in-house currency system called "FestBucks." Subscribers pay a monthly fee and receive a designated number of FestBucks, which they can use to purchase tickets to their desired events. The number of FestBucks allocated depends on the subscription tier chosen by the customer.
You can purchase these FestBucks in packs or join several tired memberships. I opted for the Lifetime membership, with includes some ambassadorship-type perks.
Numerous methods exist for individuals and businesses to adopt a festival pass to manage their annual entertainment expenditures. I often recoil from purchasing tickets, as I'm familiar with the unpleasant surprise of exorbitant fees that unscrupulous ticketing platforms slyly tuck away from plain view during the checkout process. All I desire is a platform that operates without hidden fees. FestivalPass fulfills that wish, reviving the ticket-buying experience and making it a positive one once more.
This unique approach offers several advantages over the unlimited access model:
1. Sustainable Economics: FestivalPass can manage costs more effectively using a currency system. FestBucks acts as a virtual currency that subscribers can use to purchase tickets. This ensures the company can control expenses and maintain a sustainable business model.
2. Flexibility: Subscribers of FestivalPass have the freedom to select the events they wish to participate in, allowing them to customize their experience according to their personal preferences. This adaptable approach caters to a wider audience, including those who prefer not to commit to unrestricted access.
3. Event Variety: FestivalPass provides access to a wide range of events, from intimate local performances to grand-scale festivals. This diverse array significantly enhances the subscription's value, enabling subscribers to explore many entertainment options.
4. Revenue Sharing: FestivalPass collaborates with event organizers and venues, enabling them to distribute tickets via the platform. This establishes a revenue-sharing system that mutually benefits FestivalPass and event organizers, nurturing alliances and supporting the long-term viability of the service.
The experiences of MoviePass and FestivalPass offer valuable lessons for businesses operating in the subscription-based entertainment industry:
1. Sustainable Economics: The story of MoviePass underscores the significance of building a sustainable business model. Organizations should meticulously evaluate their expenses and income sources to guarantee their enduring success.
2. Subscription Flexibility: Offering flexible subscription choices has the potential to draw in a more extensive customer demographic. FestivalPass's strategy illustrates that not all subscribers are searching for limitless access and that tailored alternatives can cater to a wide range of consumer preferences.
3. Partner Collaboration: Working with theaters, event organizers, and venues can foster mutually beneficial partnerships. FestivalPass's revenue-sharing model serves as a testament to how such collaborations can play a pivotal role in the success of a subscription-based service.
4. Customer Trust: Trust is essential in any subscription-based enterprise. MoviePass's frequent alterations to its policies undermined the confidence of its subscribers, resulting in a swift deterioration of its customer base. Maintaining customer loyalty hinges on consistency and transparent communication.
I firmly believe MoviePass was onto something significant with the viral attention it generated when it initially launched as a company. Their ability to tap into this widely shared and deeply rooted need for accessible live entertainment experiences is a robust foundation for FestivalPass to build upon and capture people's profound connection with attending events, fostering a sense of connectedness and shared enjoyment.
Let's break down the process of booking hotels and live experiences step by step with FestivalPass.
On the event front, the process is also comparable.
The narratives of MoviePass and FestivalPass vividly depict the trials and prospects inherent in subscription models within the entertainment sector. MoviePass underwent a remarkable ascent and downfall, propelled by a compelling concept that ultimately fell short in execution. In contrast, FestivalPass embraced a more flexible strategy, granting event access via an in-house currency system. By prioritizing sustainability, adaptability, and forging partnerships with event organizers, FestivalPass has adeptly navigated the challenges of the subscription-based entertainment market, securing its success.
Ultimately, the subscription model remains a viable and attractive option for consumers seeking access to a wide range of entertainment options. However, businesses in this space must learn from the past and prioritize sustainability, flexibility, and customer trust to ensure long-term success in an ever-evolving industry. MoviePass and FestivalPass serve as valuable case studies that provide valuable insights into the future of subscription-based entertainment services.
The Economic Club of Los Angeles is excited to introduce FestivalPass into our AngelList Syndicate, which has generated significant interest among our members. This level of enthusiasm is to be anticipated, given LA’s strong emphasis on entertainment. However, we have a strong belief that Ed Vincent, the founder, who has had a front-row seat experience with MoviePass and extensive years of running top-tier live events, is uniquely positioned to execute this endeavor in a manner that could genuinely empower artists and assist them in building thriving communities around their art.
Feel free to get in touch if you have a strong conviction or a portfolio construction facing disruptive, technology-savvy platforms that aim to revolutionize and advance the live music industry.
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