Often, it seems that the companies who crop up and explode with growth seemingly overnight are the ones who are also quick to disappear without much of a trace. What is it that makes business owners make this time tested mistake?
It’s easy to get swept up in momentum and success, but there is such a thing as too much growth, too fast.
Take the example of the currently flailing endeavor of MoviePass, which promised discounted movie viewing that was quite literally too good to be true. The summer of 2018 will forever be remembered as the year that MoviePass tried to be something bigger than it could realistically be. Tough luck for the brand, as consumers have long memories when it comes to being taken for a ride by a business.
Now, word has broken that a potential breach of unencrypted information, including customer credit cards, may have been exposed. This latest faux pas is just one more nail in the coffin of the subscription service that once boasted three million users. That number is now below 500,000, according to data acquired earlier this year.
So, customers are canceling in droves and MoviePass may now have an even bigger fish to fry if more damning information comes out regarding the potentially compromised information.
Let this be a lesson in too much growth too fast. The red flags were evident from the outset, and analysts were unsure of the brand’s plan for profitability given the extremely steep discounts that were offered to customers. MoviePass was forced to shut down operations temporarily when they ran into financial difficulty, but the company has made several attempts to woo its disillusioned customer base back.
An important takeaway from the story of MoviePass is that once customer loyalty and, most importantly, trust is damaged, it’s exceedingly difficult to come back. Not impossible, but a very steep uphill climb that some businesses are not able to muster.
So, when faced with rapid growth and exciting possibilities, remember the warning signs. The stacks of money are tempting, but longevity is the name of the game here. Measured growth with a solid plan for the future will ensure longer-lasting success. Don’t worry, there are plenty more stacks of cash just waiting to be claimed!
Another downfall of businesses who experience too much growth too soon is that small mistakes are often overlooked in favor of big results. But these small mistakes can lead to a harsh reality when they snowball and turn into much bigger problems. Take this potential data exposure that MoviePass is currently dealing with. This is pure speculation, of course, but chances are that somewhere in the past proper steps were not taken to protect the data customers had given up.
While it may have been seen as a small misstep or been missed on routine examination before, this problem has now turned into a much larger issue that could have far-reaching ramifications for the business in question.
Taking the initiative to ensure that each step of growth is accounted for and that there is a plan in place to handle more influx of business can pay off in the long run. Don’t get caught up in the storm of overnight success. It’s not always all it’s cracked up to be. Just ask MoviePass.