First a movie is made, and it becomes (often rather unexpectedly) somewhat of a hit. Maybe it uses some original idea that gets very popular, or it simply hits the market at the right time with the right content, and people just love it.
Often, especially if the movie was somewhat low-budgeted, this leads to a sequel to be made to cash on the popularity. (After all, if a relatively low-budget movie became such a hit, why not make another one? Even if it isn't so popular as the first one, it will bring at least some money, by riding on the fame of the first one.)
If the second movie is met with even a modest success, then often a third movie is made, then a fourth and so on. Almost invariably each new movie will be of overall lower quality than the previous ones (often because the creators run out of ideas and try to force new ideas, which usually just don't work very well). In other words, the franchise suffers from so-called sequelitis.
When exactly a movie series starts suffering from sequelitis is open to interpretation, but a general rule would be that by the fourth movie (because with only three it could be seen just as a trilogy), especially if each new movie is generally seen as worse than most of the earlier ones. (Some individual sequel in the series might be of unusual high quality, but it's rare and it's usually just an individual case.)
Sequelitis is almost universally panned and derided. It is seen as just an attempt to cash on the fame of the first movie, driven by the mindless masses throwing money at each new sequel.
However, the film makers are not the only ones to be blamed. Nor even the "dumb masses" either.
The Halloween series is a perfect example of this.
The first movie is considered to be one of the first slasher movies of all times, a trend-setter. It ended in a cliffhanger. A second movie was made to conclude the story (it was, in fact, set on the same night as the first one). While not considered equally good as the first movie, it's still held in quiteh high regard.
Then the film makers actually wanted to avoid sequelitis, and instead thought that the "Halloween" movie series would be a yearly (or so) Halloween-themed horror movie, each with an independent plot. Maybe a bit like the Tales from the Crypt TV series, but with feature-length movies. So they made a third movie which was completely separate and independent of the first two.
The movie was universally panned. There was only one reason for this: It was not about Michael Myers. That's it. No other reason. It has nothing to do with the previous movies, and thus it sucked. It didn't matter what the actual quality of the movie was. The only thing that mattered is that it was not about Michael Myers.
Everybody shunned the movie because of that. The critics, the public, everybody. Nobody liked it. Yet the movie itself is not bad. (In fact, nowadays a new appreciation for this movie has rised and it has received a small cult following.)
Everybody wanted Michael Myers. Everybody wanted sequelitis. Thus the film makers obliged. And everybody got what they wanted: Sequelitis. A series of worse and worse sequels to the original. And everybody complained.
There's no pleasing the viewers.