The Cinema: A Place of Payments Innovation?
When was the last time you had a surprisingly good customer experience? Mine was last night at the cinema. To give you the context, I have not been to a theater in almost two years (hey, I'm busy). The last time I went to the movies, the floor was sticky, the popcorn was cold, and the overall experience felt like a big ripoff after I spent at least $30. If things didn't change/improve, this particular cinema was going to go the way of the record store.
Fast-forward to the present day: The theater complex has been renovated. My wife convinced me to return to the big screen to see Gone Girl, based at least partially on the idea of a free popcorn and $5 ticket promotion (read: value). The experience was great and seamless. She booked the tickets online and chose our seats, paying an extra $1 for the convenience. When we arrived at the theater, we picked up the tickets from an automated machine in about 30 seconds.
[For more from ACI's Paul McMeekin, check out: Doubling Down on 'Card Not Present' Fraud]
The theater was clean, the seats were comfortable and reclined, the popcorn was hot (and as mentioned, free). Good for me, you say – so what?
Being at the older end of the "millennial" generation, I think I speak for all/most of us in stating we like value for our money (quite the bombshell declaration). Those of us who graduated college sometime between 2004 and 2010 entered the workforce right before or during the worst financial crisis since the Great Depression. We're a little scarred and a little jaded, and we don't like feeling ripped off. Remember the backlash against the $5 checking account fees?
On the flip side, Netflix and Hulu Plus subscriptions are soaring, because the companies are providing relevant content to my generation and others. How long will it be until ESPN cuts out the middle men and taps into the nearly 3 million broadband customers who don't have cable?
What does this have to do with payments? Everything. After my experience at the cinema, I started thinking about how the complex could make the experience even better with technology that exists today. What if the ticket could be delivered to the phone and scanned when you get to the theater? Instead of rewards such as free popcorn being delivered to the inbox, what if they came to the phone on an app that could be used at the POS via NFC?
What about using real-time analytics to offer flash sales? Could the movie complex use new pricing strategies? If a movie is not sold out the day of the event, could variable or discounted pricing start at 9:00 a.m. (a la StubHub or airlines)? Chances are, the next time you sit down on an airplane, you will not have paid the same price as the guy next to you. Could (or, rather, couldn't) theaters take this approach to maximize revenue?
Building a true picture of the consumer would need to happen. What are their likes? What would really incentivize them to come to the movies more frequently than once every 18 months? How much are they likely to spend there? Which customer(s) will likely bring a friend and maximize revenue? How can the theater provide value to the consumer? There are already bars, restaurants, and in-theater dining. What's next? Fully licensed on-site day care? Well, let's not get crazy.
Commerce and payments are all about creating value, particularly for millennials. To create value, you need to understand your customers. What do you know about your customers? How often do they visit the branch (or do they even visit)? How often do they go online to make a payment? How do they receive (and pay) their bills? How can you cross-sell to them? How can they be Net Promoters?
As for the movie Gone Girl, I would highly recommend it.
Paul McMeekin is a big believer in the power of payments and how electronic payments can change the world. He currently heads up the business intelligence and market research function at ACI, a large global payment software provider. Previous roles at ACI include product ... View Full Bio
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