It may have ben Showtime Analytics’ first CinemaCon this year, but the company attracted a lot of interest both on and off the trade show floor. In the age of Big Data, the untapped potential that is cinema audience is the next frontier of customised appeal to attract audiences to the cinema.
CJ talks to Showtime Analytic’s co-founder Joe Spurling about what cinemas get right and wrong about their customers’ data.
Celluloid Junkie: What are the benefits and insights that big data and analytics can bring to cinema operators?
Joe Spurling: One of the big buzz terms in all forms of retail for the past number of years has been the idea of “Know your customer” or “Customer journey”. At present it’s probably true that most Exhibitors don’t actually know all that much about the people that are sitting in their seats night to night. Many people feel that the answer to this is a loyalty programme but that will only tell you so much. The challenge is how to collect & integrate all customer data into a clear & actionable picture.
The real benefit of engaging big data sources and more importantly analytics is to understand at a macro level the type of people that are attending your cinema, what their general likes and dislikes are and more importantly how your cinema differs from all others.
Ultimately analytics can give Exhibitors the power to make decisions based on their own facts and figures rather than point in time industry stats or “gut feel”
CJ: Exhibitors have been gathering data on their customers for years, through membership schemes and ‘unlimited’ viewing cards. Why haven’t they done more with that data?
Joe Spurling: From my experience in talking with Exhibitors it is as much of a cultural issue than just a technology challenge. Companies like ours help address the technology gaps that exist in the ability to integrate in a cost effective manner the growing number of customer data sources, but from our own observations it’s when that data is gathered that the Industry stops “Doing more”
The majority of customer loyalty programs are making the same mistake of other industries, whereby the data is being gathered with the intention of “targeting” the customer base with ever increasing recommendations of products, shows they should see / purchase.
This is what we refer to in the analytics world as milking your customer for all they are worth!
A major principal learnt whilst working on a loyalty program with a leading European clothing brand, was the guiding principal of rewarding your loyal customers for their business.
By providing the customer base with generous exclusive rewards, they are less likely to go elsewhere & more importantly word of mouth spreads to generate new customers.
Cinema Exhibition need to learn not to milk existing customers but to change strategy and use this data with a focus for attracting new customers with a similar profile or what we refer to as “Farming” for new revenue opportunities.
So in summary, less milking, more farming!
CJ: Tim Richards of Vue made the point at CinemaCon that exhibition is a small and niche market and that it is difficult to get customised solutions. I’d imagine that you don’t agree with that sentiment.
Joe Spurling: It’s a case of both agreeing and disagreeing, Tim is correct whereby exhibition itself is small in the wider cinema context, At Showtime we see the Exhibition as part of a much wider “cinema value chain” involving many different stakeholders, all with different and similar data challenges.
As a company we have chosen to be “Cinema Niche” and we are fully focused on building exciting solutions across this entire value chain.
Our goal is to bring Cinema to a level playing data field, empowering the industry to take on competing mediums such as Online, Streaming & TV.
From our perspective that needs to start with Exhibition, which is why, our first product offering is in this space
CJ: Can you tell us a bit more about the background to Showtime Analytics and your role in setting it up?
My own personal background has been 15 years working in Data Analytics, helping customers across a breadth of industries such as Airline, Retail, Manufacturing & Telco to use data to reduce costs, increase revenues & improve quality. My own family business is in operating independent cinemas in the Irish market, so I have grown up with a love for the industry.
Approximately 18 months ago I undertook a side project with two long standing business colleagues of mine Richie & Paul, to understand what data exhibition collects and how our own analytics experience & technology skills could be applied to an industry that is data rich, but largely insight poor.
Based on the back of an initial successful proof of concept here in Ireland we attended CineEurope 2014 to research the wider appetite & usage of data analytics. From this trip it was evident to us that the skills, technologies & methodologies in the Cinema industry were lagging behind other industries.
From here we decided to form Showtime Analytics with a dedicated focus on bringing best practice innovative data services and solutions to the Cinema Industry.
CJ: This year was the ‘coming out’ party for Showtime Analytics at CinemaCon. Can you tell us a bit about the reception and reactions you had from talking to exhibitors?
Joe Spurling: CinemaCon and CineEurope have been our target launch dates for 2015, with a major effort from our entire team to bring us to this point in less than 12 months.
If I’m honest we were initially concerned that it might be a quiet few days and we really didn’t know what to expect. Those fears were allayed pretty quickly on day one with the amount of interest we saw which never really dropped over the 3 days.
It was great to engage with Exhibitors of all sizes and listen to their challenges in the data space.
Everybody we spoke to was at different stages of maturity but all recognised the need to engage in data analytics projects.
For the smaller guys, they seemed to love the fact Showtime could provide a dedicated exhibitor focused off the shelf solution, to get them started, while those used to undertaking data analytics recognised the benefit of being able to create their own unique views on the Showtime Platform and to integrate a wider variety of data sources other than purely POS Data.
Larger organisations saw the opportunity to distribute all of their content to all of their employees in all of their chain locations in a cost effective way
CJ: What is the greatest concern that exhibitors are flagging in terms of working with an external party to crunch their (and arguably the distributors’) data?
Being honest the level of push back we personally received was minimal, Exhibitors recognised that the skills & time required to build their own solution can be vastly short circuited & improved by using Showtime as their data partner.
The biggest concern amongst exhibition was who owned the data, them or us.
Our simple answer to this is that it is their data. If it comes from your system and is created by your customers and transactions, then it’s your data. And it is entirely up to you what you want to do with it – or to have us do with it on your behalf.
From discussions it became clear the root cause of this concern stems not from a competition perspective but that Exhibition feel they aren’t getting an equitable share of existing data arrangements
This is a hot topic for our clients and one we will be speaking more about at CineEurope, in terms of the opportunity for Exhibition Data Monetization.
CJ: How do you compete with larger companies such as Movio or if IBM suddenly decided to enter this field?
The reality is that “Gorilla” sized technology companies like IBM, Microsoft, Oracle already operate in this space, providing software products any Exhibitor can purchase today.
This is a software lead strategy whereby a product is purchased, built & maintained by the Exhibitor.
The big difference with Showtime is that we are a dedicated Cinema solutions provider. We are using all the latest data technologies on offer to create products and services that add immediate value to the industry, without the need to build it all from scratch.
As the Data Guys, it’s our job to research and bring the latest tools & techniques to our customers, essentially remaining technology agnostic. Therefore avoiding a common situation where an investment is made in an IBM – then it’s a one size fits all IBM solution to all data problems from there on in.
CJ: What are your own cinema going habits?
Joe Spurling: We are expecting our first baby this September so I guess my habits and data profile might change from frequent evening show thrillers to weekend cartoon consumption… You’ve got me thinking now… how will my cinema chain recognise this & reward my newfound fatherhood status?? Another opportunity for Showtime!
CJ: Thank you for taking the time to share your insights.