After the launch of Moviepass co-founder Stacy Spikes in 2018, the entrepreneur got to work planning a Steve Jobs-esque sequel. Sticking to his usual script, he devised a new twist on an old industry, this time tackling movies before feature film: “We’ve heard from the advertising world that the vast majority of advertising is wasted “, says Spikes.
Spikes sets out to solve this problem with a new platform called PreShow Interactive, which it launched in beta in April 2021. The service allows users to earn credits for watching branded content, while a facial detection software confirms that they actually watched the ads and are not instead making a bowl of popcorn in the middle of the ad.
“We’ve basically created a machine that says, ‘I’m going to pay [a person] for their time,” Spikes says of his advertising model, which he hopes will create value for users and brands.
PreShow draws on and complies with data privacy laws such as the European Union’s General Data Protection Regulation (GDPR), a legal framework that establishes guidelines for the collection and management of personal information consumers. This means that Pre-Show users must sign up for face detection and the data collected about their ad viewing experience is anonymized. In Spike’s words, PreShow ensures that, for the first time, publicity becomes consensus.
And to sweeten the deal, Spikes says he’s been giving a lot of thought to the branded content PreShow will serve to credit-hungry moviegoers. His early research shows that consumers prefer to watch what Spikes calls “advertising” – longer, more cinematic ads – before their scheduled content airs (much like in a movie theater). People who love movies generally enjoy visual storytelling, Spikes explains, which is why commercials like the infamous James Bond Heineken ad are so popular.
This is, of course, a boon for advertisers, Spikes says, as it gives brands more time to develop and deliver their message. And don’t forget facial detection, which, combined with short surveys at the end of each ad, helped brands participating in beta testing increase consumer engagement by up to 75%.
The other big twist? PreShow will likely create a way for MoviePass users to redeem credits for tickets. In 2021, Spikes bought out his old business from Chapter 11 bankruptcy for $140,000 and is working on some changes for the next chapter of MoviePass, including a three-tier payment system. The new system aims to be more durable than the infamous $10 monthly price that last saw the company crash (though Spikes is quick to point out that the price drop happened after he left).
Under the tiered system, users would pay a bit more for prestige content — though Spikes doesn’t think monthly costs will be north of $30. And users in Waco, Texas, for example, probably won’t pay the same amount as a user in New York or Los Angeles.
With PreShow’s ad revenue and MoviePass’ revised subscription model, Spikes may finally win big: “Movie release really hasn’t changed in 50 years,” he says, “You make a trailer and TV spots you put that in the ecosystem and then on Friday night you pray that people come in. That’s always been the business model, but we’re talking about a subscription model where you can communicate to the consumer.
“Attention is one of the most sought-after assets on the planet because where attention is, money will follow,” he adds.
Excerpt from the May/June 2022 issue of Inc. Magazine