Fox taps Social Rewards loyalty program to identify avid fans
Sit through the two-minute YouTube trailer for 20th Century Fox’s upcoming movie “The Maze Runner,” earn 25 points. Post a link to the trailer on Twitter, earn 15 more points. Facebook? Same deal, 15 points.
Five hundred points earns discounts on theater tickets and concessions.
FoxRewards.com, run by a Torrance start-up, aims to encourage movie enthusiasts to deliver oodles of marketing data about themselves to 20th Century Fox Film.
Hollywood studios and theater chains are willing to reward social media users to gain deeper access to what they say and do. They want to identify the most avid fans and get their help in attracting others to theaters — an increasingly difficult task.
Patronage at the U.S. box office has been declining as ticket prices rise. Sales increased just 1% to $10.9 billion in 2013.
Social Rewards, which developed the computer code that powers the FoxRewards website, said 25,000 people earned points during its first three months.
An additional 650,000 people earned more than $1 million in discounts during the last two years from similar websites the start-up built for All Nippon Airways Co. and Caesars Entertainment Corp. casinos. Social Rewards said the airline and the casinos have used data shared by social media users to craft getaway deals and offer complimentary extras to particularly influential people.
“In old loyalty programs, you had to purchase something,” Social Rewards co-founder Mike Uesugi said. “Now you just have to engage, and companies show appreciation when people talk about them on social media.”
The goal is to build a powerful database of marketing intelligence. By partnering with theaters, Social Rewards can access movie sales data. That gives Fox the power to match people’s movie ticket purchases with their trailer-viewing history — and their social media accounts, including friends lists, email addresses and biographical data.
A number of other start-ups have built programs that bake online sharing and data capture into loyalty programs. PunchTab, based in Palo Alto, has raised more than $11 million and works with brands such as Kroger Co. and H.J. Heinz Co. New York-based CrowdTwist, which has raised $20 million, lists as clients Vizio, Ultimate Fighting Championship and L’Oreal USA.
Other competition includes Switchfly in San Francisco, BigDoor in Seattle, Pluck in Austin, Texas, and Belly in Chicago. But Social Rewards, with $850,000 in funding and 11 employees, boasts that it’s the first to tap into Hollywood. It expects to have 600 theaters as partners by summer’s end as discussions continue with three large theater chains and at least one studio other than Fox.
“Every week, movies are a trending topic on Twitter and Facebook,” Social Rewards Chief Executive Joseph Morin said. “We want to go where the eyeballs already are and turn loyalty programs into a revenue generator.”
Morin had worked with a number of online marketing firms, including Travelzoo Inc. and Usedcars.com, before realizing in 2009 that Twitter’s surging popularity could enable peer-to-peer advertising. He called for help from his high school friend, Uesugi.
They tested an early version of Social Rewards at a few Las Vegas casinos, which offered members of the new program free meals and drinks in exchange for using Facebook and Twitter to share deals, photos and memorable tidbits.
Of all the reward-earning activities, watching ads for Vegas shows proved the most popular. That’s what turned their attention to movie trailers and a cold-call to Fox.
“Fox wanted to create a loyalty program because outside of Disney and Pixar, there’s really no brand affinity to studios,” Morin said. “We presented them with the idea and they ran with it.”
Fox pays a few cents per action taken on the rewards website, and partner theaters get a cut. In Social Rewards’ other deals, All Nippon Airways licenses the platform for a fee, whereas the goal for the Caesars program is to make money from brands that want to promote their casino-affiliated product or event.
For Fox, data could reveal which moviegoers inspire large groups of friends to come along, with the idea of luring such “influencers” to do so with even more movies.
“Studios don’t normally get access to the people who are their massive, vocal fans,” said Andrew Stephen, a business economics professor at the University of Pittsburgh. “This is one way to break down the barriers.”
Socially driven loyalty programs can survive as long as customers believe that the rewards they receive are worth more than the privacy they surrender, marketing experts said. The cost to the customers’ reputation from the potentially tacky posts must be minimized too. Also key: being transparent about what information is collected and how it’s stored.
If studios can tap those influencers to keep the word spreading, movies could remain on lucrative big screens for longer, said Ari Lightman, a professor of digital media and marketing at Carnegie Mellon University. Optimizing marketing could also make major studios more willing to back smaller films that they might otherwise skip, Lightman said.
He pointed to how Netflix Inc. mined data to theorize that people’s interest in political dramas and actor Kevin Spacey would make its show “House of Cards” a hit.
“Studios, as they grow more competitive — and as people become more reluctant to spend time at the movies — face more competition to get people into seats,” Lightman said. “They are going to have to get more data-savvy.”
Twitter: @peard33
