Customer Acquisition and Retention
AMA with Chandler Delmas, Director of Loyalty Marketing, CINEMARK
Chandler is the Director of Loyalty Marketing at Cinemark. She has worked in marketing and public relations for most if her career and is an MBA candidate. Today’s AMA will focus on customer acquisition and retention tactics
CHANDLER DELMAS, CINEMARK
“The pandemic only expedited the need for growth hacking, to test and learn and make incremental changes to CX based on data. Consumers have become savvier in their shopping behavior and their expectations have continued to grow which requires us to test/learn and increment at the speed of light in order to stay on par with consumer expectations.”
Full Transcript
*Questions submitted by community members
Transcript and highlights from our last Ask Me Anything.
Hi Chandler - Thanks for being here with us today!
Hi all, thanks for having me!
Question: Let’s get started! How does Cinemark know that by offering a package that it’s producing incremental value?
Cinemark’s culture is big on testing and learning to make scalable decisions. Most of our promotional offers and acquisition tactics include a control group so we can calculate incrementality. For our subscription program overall, we deeply analyzed the incremental value of the program through data triangulation to ensure it’s bringing incremental value to the company.
Question: What is the optimal budget allocation between acquisition and retention efforts? Should more weight be given to one over the other?
I think all programs are different. For Cinemark, we have historically focused the majority of our budget on acquisition because we were heavily focused on growth. More recently since the pandemic, we’ve transitioned more of our budget to retention, although still a small portion. Our churn rates are extremely low and membership is heavily focused on content schedules (i.e. some members canceling in January when content is not as strong and rejoining in March when content picks up). So we can forecast when we expect churned members to rejoin and only spend money if they don’t naturally come back during that time.
Question: How many payment options (credit card, bank transfer, Apple Pay, etc) are too many? Which are the most effective at driving acquisition?
Our program has been successful with only offering credit and debit card payment options, but we’re exploring adding ACH. We’ve explored digital wallets but haven’t implemented any yet. Curious to hear others' thoughts on this one as well!
Question: How has Cinemark’s customer retention strategies changed over time to adapt to the changing consumer consumption habits? What are some future patterns or habits you anticipate that Cinemark is adjusting to?
We have seen very positive results in both velocity (the time it takes someone to convert) and overall conversion rates when digital wallet options are added as payment options. This may or may not translate to Cinemark but could be worth testing. As our program has matured, we’ve been able to collect a huge amount of data to identify consumer behaviors. We found that many members who cancel rejoin within a matter of months, mostly due to content variability. From there we were able to add more retention features like pause and a secret “Lite” plan within the cancellation flow. Additionally, we’ve been able to use that data to personalize the retention experience. For example, reinforcing the amount a member has saved over their membership. We'll continue to increase our use of personalization.
Question: That’s really interesting! can you elaborate more on this “Lite” plan within the cancellation flow?
Sure, as a saving tactic we offer members the option to pay a lower fee for reduced benefits. In our case, that's fewer movie tickets for half price, but members retain all other benefits. Pause has been a huge retention tactic for us throughout the Pandemic with theatre closures and also for those that cancel due to content variability. We also recently launched an annual plan that should reduce churn due to content variability. Also sending a cancellation survey post-churn has helped us to identify areas for improvement to reduce future churn.
This is fascinating, what % of successful saves take up this offer? Really smart.
Agreed, would love to test this if we can 'easily' integrate it into our checkout flow.
Save tactics like those are really smart.
Question: What are the primary retention metrics you are tracking?
Churn rate (voluntary and involuntary), retention rate, trial conversion rate, recovery rate. Involuntary churn was a huge focus after having paused billing for over a year and then restarting.
Question: Are you able to indicate if a subscriber is more or less likely to churn? If so, what do you track and what would your next steps be?
Using historical data we can predictively model who is at risk for churn and adjust our messaging to reinforce the value of the program, and what they’ve saved and show the depth of the upcoming film slate. We can monitor frequency, spending, recency, engagement with the program, etc. to predict who's at risk.
Fun fact, I am one of those people haha. Involuntary churner bc I haven't updated my CC info. And I am thinking the new Spiderman movie will bring me back to the theater
Let's hope!! Come back on the new annual plan promo
Question: Fantastic! is there a central team that leads testing the concept, design, dev, etc?
No, it's scattered. UX testing is one area, data/analytics another, etc. My team partners in conception and design.
Question: What’s been the pandemic’s silver lining in the movie theatre category?
I would say the pandemic has forced movie theatres to innovate like never before. Cinemark was the first exhibitor to introduce private watch parties as a result of the pandemic, in an effort to bring guests back to the theatres and ensure they feel comfortable with who they're in an auditorium with. We are also exploring new special content that is a very exciting progression! Stay tuned.
Question: Even prior to the pandemic, movie theaters were making big improvements to their CX, how has that culture of innovation been affected by the pandemic?
Agreed, theatres have made huge strides in CX over recent years. The pandemic only expedited the need for growth hacking, to test and learn and make incremental changes to CX based on data. Consumers have become savvier in their shopping behavior and their expectations have continued to grow which requires us to test/learn and increment at the speed of light in order to stay on par with consumer expectations. Personalization is also a key factor in that.
Question: Are loyalty programs or subscriptions better for repeat movie-goers?
Subscriptions are better for repeat moviegoers from a consumer and business perspective. Consumers can take advantage of discounted tickets and concessions. For movie theatres, we can take advantage of recurring revenue that helps to offset low content periods. For Cinemark specifically, our subscription program is uniquely designed so that it’s not based on a breakage model and we encourage (and get) incremental visits from members. Loyalty programs still have a place for repeat movie-goers who aren’t ready to commit to a recurring payment.
I've been thinking a lot about loyalty programs lately and seriously questioning the incrementally vs the institutional momentum -- wondering if the core product value proposition has been lost in the process. It’s an interesting question because so much of the experience is tied to ancillaries like a concession, where loyalty programs can be a nice benefit. And I fully appreciate the point about some regular moviegoers not yet at the point of recurring-payment commitment, that's a particularly interesting challenge as it's likely largely dependent upon the level of interest for the forthcoming new releases.
Question: I’m curious as to how Cinemark innovated on this idea of creating in-person private watch parties, as it sounds like a culture of experimentation and innovation is strong at Cinemark. How does Cinemark cultivate a culture like that?
I think it comes from Executive empowerment. Our Exec team is great about letting us try new ideas and concepts to prove out.
Movies/theaters are a great example of maintaining the desired core experience but also changing/evolving with the times.
I would add a follow-on question...is that culture prevalent throughout the org or mostly in digital? ie are you testing and optimizing the physical theatre experience?
Question: Are you watching what MoviePass is up to these days? Is it still on the radar?
Hold while I find the appropriate emoji...Just kidding... we are always interested in what our competition or former competition is up to.
Question: Can you build more theaters in Northern NJ please?
Yes will get right on that!
Question: OK - our last submitted question: What are your thoughts on streaming services like Disney+ charging a monthly subscription and a one-time fee for new releases?
Obviously being in the theatre business our preference is for studios to offer new releases exclusively in theatres before streaming. I think Disney saw that charging a premium on top of the subscription fee and bypassing theatres led to lackluster results, so they reevaluated that strategy.
Thank you, Chandler for taking time today to answer these great questions! We enjoyed the time with you.
Thank you for having me, it was a pleasure!
Thanks so much!
Thanks!
I definitely need to re-read some of these posts...so many jewels that I could not keep up