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A G E N D A
Clarify ChargeQualitative AnalysisFinancial AnalysisGrowth StrategiesRisk MitigationResearch & DevelopmentQ&A
C L A R I F Y C H A R G EHow should IMAX allocate further expansion in BRIC countries by 2020?
Growth strategies and risk mitigationrecommendations?
How much should IMAX invest into Research & Development initiatives?
• CHARGE ANALYSIS GROWTH STRATEGIES RISK MITIGATION R&D
Q U A L I TAT I V E A N A LY S I S M E T H O D O L O G Y
CULTURAL ANALYSIS POLITICAL ANALYSIS ECONOMIC ANALYSIS
CHARGE • ANALYSIS GROWTH STRATEGIES RISK MITIGATION R&D
IndulgenceLong Term OrientationUncertainty AvoidanceMasculinityIndividualismPower Distance
Ease of Doing BusinessVoice and AccountabilityPolitical StabilityGovernment effectivenessRegulatory QualityRule of LawControl of Corruption
Target MarketHollywood InfluenceIMAX per capitaBox Office Revenue
Q U A L I TAT I V E A N A LY S I S R ESU LTS
CHARGE • ANALYSIS GROWTH STRATEGIES RISK MITIGATION R&D
Brazil Russia India China
Cultural Analysis
Political Analysis
Economic Analysis
Cumulative Score
43
45
39
41
47
47
73
59
28
42
45
40
40
30
51
43
TA R G E T M A R K E T M E T H O D O L O G Y
CHARGE • ANALYSIS GROWTH STRATEGIES RISK MITIGATION R&D
TOTAL POPULATION MIDDLE
CLASS
URBANPOPULATION AGE
DEMOGRAPHICADDRESSABLE
MARKET
TA R G E T M A R K E T I N D I A E X A M P L E
CHARGE • ANALYSIS GROWTH STRATEGIES RISK MITIGATION R&D
410,970,797 37,168,199 16,835,9571,270,000,000 69,865,036
TOTAL POPULATION
URBAN POPULATION
MIDDLE CLASS
AGE DEMOGRAPHIC
ADDRESSABLEMARKET
R E V E N U E M E T H O D O L O G Y
Avg. IMAX Movie Ticket x Addressable Market = Total Theater Revenue
Total Theater Revenue x 20% Revenue Share = Total IMAX Revenue
Total IMAX Revenue – Cannibalization = Net Revenue
CHARGE • ANALYSIS GROWTH STRATEGIES RISK MITIGATION R&D
R E V E N U E M E T H O D O L O G Y I N D I A E X A M P L E
CHARGE • ANALYSIS GROWTH STRATEGIES RISK MITIGATION R&D
Avg. IMAX Movie Ticket x Addressable Market = Total Theater Revenue$6.00 x 16,835,957 = $101,015,742
Total Theater Revenue x 20% Revenue Share = Total IMAX Revenue$101,015,742 x 0.20 = $20,203,148
Total IMAX Revenue – Cannibalization = Net Revenue$20,203,148 – 0 = $20,203,148
F U T U R E E X PA N S I O N A L L O C AT I O N S
400 / 1600screens to be installed in BRIC countries
Country Screens to add by 2020 Percentage of Allocation
Percentage of Screen Growth
Brazil 64 16.00% 24%
Russia 61 15.25% 13%
India 100 25.00% 31%
China 175 43.75% 8%
CHARGE • ANALYSIS GROWTH STRATEGIES RISK MITIGATION R&D
M E T H O D O L O G Y C O N T ’ D
We feel confident that our recommendation is sound based on two independent models which take into account provided quantitative data and external research.
CHARGE • ANALYSIS GROWTH STRATEGIES RISK MITIGATION R&D
&CHINA INDIA
CHARGE ANALYSIS • GROWTH STRATEGIES RISK MITIGATION R&D
TO P T W O C O U N T R I E S
CHINA INDIA
G R O W T H S T R AT E G Y
CHARGE ANALYSIS • GROWTH STRATEGIES RISK MITIGATION R&D
GEOGRAPHY PARTNERSHIPSMARKETING
123
NATIONAL HOUSEHOLD INCOME
STRATEGY: Start with successful cities, roll out to new
CHARGE ANALYSIS • GROWTH STRATEGIES RISK MITIGATION R&D
C H I N A G E O G R A P H Y
$6,180 USD (in 2013)
Cinema
Market Share
Dalian WANDA Group
Shanghai Film Group
China Film Stellar
Guangdong DadiShenzen China Film
Other
14.3%
8.8%
8.4%7.5%7.1%
C H I N A P A R T N E R S H I P S
CHARGE ANALYSIS • GROWTH STRATEGIES RISK MITIGATION R&D
C H I N A M A R K E T I N G
“Trading Up to 2020”
CHARGE ANALYSIS • GROWTH STRATEGIES RISK MITIGATION R&D
Protectionism
Dislike of Western Culture
Corruption
High Power Distance
C H I N A C O N S I D E R A T I O N S
CHARGE ANALYSIS • GROWTH STRATEGIES RISK MITIGATION R&D
I N D I A G E O G R A P H Y
CHARGE ANALYSIS • GROWTH STRATEGIES RISK MITIGATION R&D
STRATEGY: Urbanized and infrastructure focused
NATIONAL HOUSEHOLD INCOME
$3,168 USD (in 2013)
Current PartnershipsCinepolis, PVR Films
CHARGE ANALYSIS • GROWTH STRATEGIES RISK MITIGATION R&D
I N D I A P A R T N E R S H I P S
I N D I A M A R K E T I N G
CHARGE ANALYSIS • GROWTH STRATEGIES RISK MITIGATION R&D
“Aspirants”into2020
“Trading Up to 2020”
I N D I A C O N S I D E R A T I O N S
CHARGE ANALYSIS • GROWTH STRATEGIES RISK MITIGATION R&D
Luxury product perception
Government
Infrastructure
Fast followers
I N T E R N AT I O N A L R I S K M I T I G AT I O N
CHARGE ANALYSIS GROWTH STRATEGIES • RISK MITIGATION R&D
1. FOREIGN ENTRY PREMIUMSMitigation: Research and Relationships
2. IP RISKMitigation: Become subject matter specialists
3. FOREIGN EXCHANGE RISKMitigation: Currency hedging, contract terms, and temporary price changes
4. STREAMING SERVICESMitigation: Invest a portion of R&D to new movie-watching source
10% of revenue $28M
CHARGE ANALYSIS GROWTH STRATEGIES RISK MITIGATION • R&D
R E S E A R C H & D E V E L O P M E N T
175 100
6461
LOCATIONS
10% of revenue for IMAX at homeR&D
GROWTH STRATEGY1.Geography 2.Partnerships3.Marketing
CHARGE ANALYSIS GROWTH STRATEGIES RISK MITIGATION • R&D
C O N C L U S I O N