Mark Cuban’s Challenge – My Answer…Buzz

A few days ago, billionaire Mark Cuban (who owns various entertainment assets, including a film production studio, theatre chain, etc.) posed an open challenge on his blog:

… How do you get people out of the house to see your movie without spending a fortune. How can you convince 5 million people to give up their weekend and go to a theater to see a specific movie without spending 60mm dollars.

So if you… have a great idea on how to market movies in a completely different way. If your idea works for any and all kinds of movies. If it changes the dynamics and the economics of promoting movies, email it or post it. If its new and unique, i want to hear about it.

Since Mark and I have a little bit of history debating issues that are vexing the entertainment industry, I thought it would be appropriate (and fun) to respond to his challenge openly with this post. So with that… Mark, here’s what you should do.


Whenever anyone goes to a movie theatre, they end up with a ticket stub. I would propose that you create a program/system to make those ticket stubs into currency… essentially a coupon that can be passed around, traded, bought/sold, etc.

Allow me to illustrate with a hypothetical. Let’s assume I went to see The Pirates of the Caribbean on opening day and I paid $8.00 for my ticket. I leave with a ticket stub that has been date/time-stamped. Then sometime during the following week, I run into my friend Sarah at Starbucks.

During the course of our conversation, I tell her that I had seen Pirates and recommend that she should see also it. As a friendly gesture, I pull out my wallet and give her my ticket stub. Sarah decides to go see the movie the following weekend, and since exactly one week has passed since my ticket stub was stamped, she is entitled to receive a $1.00 discount. Now, had she waited two weeks to see the movie, she would have received a $2.00 discount.

In other words, the stub becomes more valuable as time passes… up to the point where the ticket price post-discount begins to approach the value of DVDs entering the rental release window. Sarah, delighted by my kind gesture, returns the favor by presenting me with a stub of her own… a 3-week old stub for The Devil Wears Prada. Although I hadn’t been planning to see Prada, I decide I might as well since Sarah’s stub means I’ll get $3.00 off my ticket price.

These days, word-of-mouth is the single most influential factor that drives a film’s success. And what I am proposing is akin to institutionalizing word-of-mouth into a capital market, where the ticket stub becomes the currency. Not only is this concept likely to increase the volume of movie-goers (as any consumer goods promotional expert will attest), it is also likely to impact the distribution curve of box-office receipts… when the vast majority of movies are released into the theatrical exhibition window, they normally go through a fairly consistent demand/revenue curve at the box office… essentially, box office receipts are cut in half with every subsequent week.

So if a film grosses $100 million opening weekend, it’s likely to do about $50 million the following week, then $25 million the week after that, etc. By turning ticket stubs into coupons, week-to-week box office numbers are likely to get impacted by increased demand and volume of viewers… which consequently should improve marketing budget yields via lowered customer acquisition costs.

While there are many more implications I could discuss (e.g. stubs will probably show up on eBay, people will list their stubs on their social networking profiles, etc.), I’ll stop here for now. So Mark, chew on the concept… I think it will change the dynamics and economics of movie marketing and promotions.

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