This is a live transcript of one of the many seminars and presentations at CineEurope 2016. As such it is likely to contain errors and omissions that are more likely than not the fault of the transcriber (yours truly) than the speakers. Sometimes we condense or abbreviate points being made. The text may sometimes not make complete sense as it was made to be heard rather than read. But every effort has been made to present what was said as accurately as possible.
The first session after the executive roundtable was about perhaps the most important technological challenge facing cinemas: Big Data and how to turn insights from it into better ways to engage audiences. There was a good representation (though again, all male) from cinemas, distributors and vendors.
Jan Runge chaired the session and began by acknowledging the 4DX sponsorship of the session.
Jan Runge: Introduce yourselves.
Fernando Evole: I’m country manager Cinépolis Spain (formerly Yelmo). 37 cinemas in Spain, 414 screen. 400 million tickets per year. 4,600 screens worldwide. Data on customers is key of our industry.
William Palmer: Co-founder Movio; campaign management platform. Used by 25% of cinemas with more than 20 screens. We profile data and serve it back to our cinema partners in a manageable way. Movio Media enables cinemas to work with distribution.
Richard Power: Showtime Analytics. We work with the entire cinema value chain but primary focus is exhibition. Gather and store all the data in one place and drive insights.
Tonis Kiis: Warner Bros International. Everything is digital these days so my portfolio includes new business opportunities for theatrical.
Jim Zak: Comscore (formerly Rentrak). We collect data from theatres all over the world. Core business is box office. We offer data analytics.
Evole: It was pointed out that we need to offer the best experience, but we need to know what our customer wants. We don’t see our customers as our main asset in our company. Previously we thought it was real estate asset. Now the customer is what we need to capitalise on. Studios need to look at way they look at customer. What do they want, when do they want it, etc. It is a challenge to change relationship dynamic between exhibitors and distributors. Distributors do great marketing campaigns to convince customer to go to cinema, but they are our customers already. We can be more efficient. This is a game changer for our industry. Distributors see exhibitors as people who collect money for them. Maybe 3rd parties will help change this dynamic. There is huge opportunity to be closer to customer.
Runge: Has consolidation changed you?
Evole: Innovation can require scale. You need it for the best talent that you can hire on data analysis. If you are small you go through third party player. Scale is important. We were a Spanish player and now we are part of a global No. 2 exhibitor globally. Enables us to manage data better.
Kiis: WB as a studio is very data centric, especially given on international side. Decisions are increasingly dependent on big data sets. Paradigm shift in industry has facilitated this.
Runge: Is it different than Netflix?
Kiis: Different data sets have to be in different buckets. As distributor we don’t have access to point of sale, so no access to conquer. We look at admissions data and track it so that we can maximise our films as far as release planning goes.
Runge: Has potential been properly described according to you service providers?
Palmer: Both WB and Cinepolis are our customers. Movio is there to help our partners to understand its own data. So that they can do better targeted campaigns. We take cinema partners’ data they they have allowed us to share in pool and non-attributable data. Helps studios understand how the profile of the audience evolves. 16 movies that we tracked this year were profitable and only one wasn’t. This is exhibitors and studios working together. Cinemas are not giving away data, but are sharing insights with studios. They don’t lose control of their data.
Power: To maximise benefits of data you have to make it cultural in you organisation. It takes guts to get past your gut feeling and be aware of the data, whether or not you act on it. It is the cinemas’ data but you have to be cultural about it. But it has value to wider environment.
Zak: Major and independent cinemas have access to tools alike to accomplish the goal of growing the market place, so we provide tools that augment decision making. Our goal is to help the industry as a whole.
Runge: Is it for small operators too?
Power: It is for everyone. You don’t need advanced technology, just pick key KPI [key performance indicator]. Be aware of what the data is, take action and be aware if it is having an impact. I am going to look at my data and be disciplined about it. In airlines [industry] they did it on a per-user licence. So for big companies they have a department. But the power is to put it in the hands of everyone. Floor managers can take better decisions with data in their hands.
Evole: Good to take a step back and ask what information are you looking or. Because there is so much data. You need to have a clear idea of your goal. Ask correct question before looking at the data. When we deliver data to third parties, this information needs to be processed and presented that are not just of use to people paying for the info but also for us. For Movio and Comscore it is about third party client that pays for that info. We need to improv our attendance, our concession margins, we need information to improve those KPIs.
Runge: Can you use it to reach new customer?
Fernando: We try to get frequency up as it brings attendance. We look at information that people who come spend more money. Moving our customers to our concessions stand gives us great margins. By offering best offer and knowing what customer wants, that offer will attract more attendance because we are doing the right ting for the right people.
Kiis: Studios can help exhibitors with that of how the customer can be reached. Exhibitors and distributors need to work together.There are many ways to pay for information or share value. But our business will go down the road, maybe we need 3rd parties to relate on these terms, but that is the way to go.
Palmer: There is a way of allocating spend that comes from studio that access information from cinemas. Second is seasonal, so we can catch the people who have not watched a film yet but who should. Activation and extending value.
Power: Netflix is the real competitor. Netflix has a direct relationship with their customers. They can poll what the customers want. There is a blockage in terms of the customers not belonging to the people who make the content.
Zak: We are utilising datasets from outside the program. There are datasets outside our industry that we can tap into.
Runge: Then should we let new providers define the relationship?
Kiis: Exhibitors and distributors can figure out their relationship on their own. We welcome the help from third parties.
Palmer: Cinemas are unleashing strategies and have long term plans. Large exhibitors are catching up. Next step is how do we create benchmarks that makes it easy for studios to make world-wide campaigns. We need to find a nice way to serve up the data. That is the missing piece. Needs commitment form both sides.
Kiis: Global fragmentations is a challenge. We all agree that Big Data is a good thing, it is a good development in our industry. Every good thing comes with caveats. Predictive analytics – there is a chance that the computer simulation gets ahead of the story. The product is very subjective value proposition. All the simulations is effectively just a simulation and prediction. Nobody can predict how good a movie is until we put it on the big screen. [Uses the analogy of weather forecaster.]
Zak: What we do with our product is with the caveat that this is to enhance your decision making. Big Data and predictive analysis should be used with caution but also be a reference point to augment your decision making.
Power: We talk about art vs. science, but there is always going to be uncertainty. If you look at “House of Cards” it was the first used of big data use for creating a piece of content. It was a pure Big Data play because the data , but you can’t predict that my Dad would love “Breaking Bad”. There is always going to be outliers.
Runge: Does Europe compare well to the rest of the world?
Palmer: There are similarities in terms of loyalty programmes. In Europe there is the Data Privacy that is more strict and almost regional. Challenges about cloud computing and privacy. These are all things that companies have got through. There is no ticket aggregator like Fandango, but there is more opportunity.
Zak: One of the pain points is cost and know-how for a sophisticated data analytics. Probably not in house. So you look at vendor like us here on stage. Secondly the pain point is know-how, which is how it gets implemented. You need testing, trial period, playing around, and if it works for you – based on your benchmarks – the a deal is made.
Evole: Exhibitors need to think that customer is the key and centre to our business. We need to hire and investing in the right tools. We need to decide if we want to be independent to crack our numbers. Or do we give information to third party and they give us back some information that is of use to us and then sell the rest of the information to studios and others.
Palmer: Some exhibitors when doing their financial calls they have to put out the number of their loyalty schemes and it assigns a value to each member. So for any data strategy – what are you doing it for? It is about customer rather than bricks and mortars. If our clients just want the tools then we give it to them. But what is your purpose?
Fernando: We have only talked about the value of our customers in the first window. We have not talked about it in the next [post-theatrical] windows.
Kiis: For WB it is the same . For years we developed tools in-house. Given the fast technological advancement we can’t keep up. The tools that are being introduced by third parties have a lot of good things. So we do both. We have systems that we work with in-house but we talk to third parties and incorporate.
Power: Technology is a tool, but some of our customers are having better results based on how they use the tools.
Runge: Time for questions. [Opens it to questions from the floor]
Bill Beck: Is data used for quality assurance?
Evole: We are using data to improve experience and process than on content. We try to have correct offer that matches correct demand. Maximise revenue, increase market share and increase spend per head. So we analyse market basket that customers are choosing. If they buy one product what is the chance of them buying another product. We need to improve revenues and margins in cinemas.
Palmer: Production and eve film financing have looked at data to know if there is an audience for a particular script or director. This is arts and science together.
Power: Our insights product looks at operational side.
Kiis: Any quantitative analysis has to be coupled with a tremendous amount of qualitative analysis. We talk about Big Data but I can’t over emphasise how important that side of the business is.
Question [unknown person]: Will data eliminate surprises and discoveries?
Evole: No, the opposite way. Because with segmentation it will be the other way. You can give the correct value proposition with each customer.
Power: Some of our biggest success have been with event cinema,
Phil Clap: [Question about outside industry datasets.]
Palmer: We have View of Demand where we look at impressions on the web, social media and torrents. We also try to do Data matching. Ethnicity is used in the US as a tool to get the content and screens matching up. So other data sets are not widely used but we can think of things.
Question: Is loyalty programme only way to engage customer?
Zak: We use post-track where we do exit interviews. Not rolled out internationally but gives great insight as to why a consumer went to a movie.
Palmer: Richest data will come form the loyalty schemes but you can get data from clicks on your website and also on social media. Loyalty is the most effective from marketing standpoint.
Zak: Give it a shot. Be open minded. Let the pitch come to you. Don’t let data make the decisions for you l t it help you.
Kiis: For WB it is key to work closely with all parties that have access to data. There is tremendous value in that. We need to come together and work on these plans to maximise our films and cinema going experience.
Power: Data analytics is a journey. My advice is start tomorrow, start small, got to know data points, take action and track it. If you own Microsoft Excel you can start in the morning.
Palmer: Work on quality and quantity of data. Get it in a way that you can commercialise it.
Evole: Exhibitors – know your customers and invest in them. Try to capitalise on that information in discussions with studios. There is still room for improvement in that discussion.
And with that the session ended.