Data Economics

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YDC Data Monetization Index for Movie Theaters – AMC’s Loyalty Program Looks Like a Hidden Asset

February 25, 2022

Summary

Movie Theater companies have a Data Monetization Index (DMI) in the range of 0.22% to 25.14% with an average of 8.90%. The DMI calculation for AMC Entertainment Holdings, Inc. (AMC), Cinemark Holdings, Inc. (Cinemark) and IMAX Corporation (IMAX) are based exclusively on the valuation of their respective loyalty / customer data and rely on publicly-available sources only. 

A higher DMI is generally preferable across companies and industries. By way of reference, internet companies have a higher DMI because most of their enterprise value is derived from data. For example, Google’s DMI is 93 percent because it generates most of its revenues from advertising based on user interaction data.

Data Monetization Index (DMI)

The YDC team recently published a Data Monetization Index (DMI) for the Movie Theater industry (see Table 1).  Based on public reporting, AMC and Cinemark have 50 million and 800,000 loyalty members respectively. We assumed that IMAX has 32,000 customers based on internal assumptions.

The DMI is the value of a company’s data relative to Enterprise Value. Enterprise Value is a key metric used in the investment community and is calculated as equity value plus long-term debt minus cash.The Loyalty Data Valuation methodology uses Customer Lifetime Value (CLV), customer counts, loyalty membership, revenues, gross margin, ticket size, purchasing frequency, churn rate, customer tenure and discount rates from publicly-available pre-COVID data sources only. 

Company NameEnterprise ValueData ValuationDMI
AMC Entertainment Holdings, Inc$18,430,000,000$4,633,753,41125.14%
Cinemark Holdings, Inc$5,420,000,000$73,312,7531.35%
IMAX Corporation$1,190,000,000$2,598,6340.22%
Table 1: DMI for AMC, Cinemark and IMAX

AMC’s Loyalty Program Looks Like a Hidden Asset

Based on our analysis, the DMI for AMC is significantly higher than its peers due to untapped data value. In a previous blog, we discussed how several airlines monetized their loyalty programs to raise money during COVID-10. As mentioned earlier, AMC has a huge loyalty customer base of 50 million members that is potentially monetizable over time.

Obviously, a number of factors will impact these estimates including a more precise calculation of Customer Lifetime Value (CLV), loyalty membership, and the companies’ stance on data privacy. In addition, moviegoer behaviors may have changed permanently in the post-COVID era, and that will also have an impact on data valuation.

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