Aimia (TSX:AIM) operates a loyalty solutions business, which is a well recognized, global full service provider of next generation loyalty solutions for many of the world’s leading brands in the retail, travel and hospitality, financial services and entertainment verticals. Aimia is focused on growing earnings through existing business and investments. The company is very cheap with a price to earnings ratio of 65.81, price to book ratio of 0.87, and market capitalization of $383 million.
As a customer-centric organization, Aimia helps companies identify and target key customer segments to deliver personalized brand experiences. The company’s proprietary methodology uses unique algorithms, artificial intelligence and machine learning techniques to classify, quantify and predict consumer behavior across customer journey milestones. This holistic approach uncovers the highest impact revenue opportunities and risks for clients.
Aimia Loyalty Solutions offers professional services to support strategy and program design, program management and measurement, campaign and customer experience, advanced analytics, and partnerships and rewards, supported by proprietary loyalty technology and data analytics platforms. These platforms support over 200 million program members worldwide and more than 10 billion transactions and interactions per year.
Aimia combines advanced data management capabilities, leading edge software solutions and proven analytics to help clients increase customer loyalty and grow sales. The company’s software platforms are designed to process massive data volumes at high speeds, making complex analytics scalable across client organisations.
The intuitive design and flexibility of Aimia’s products help align desired outputs to clients’ business processes. This make it easier for business users to make timely, smarter and more informed category management and marketing decisions. The company’s software also monetizes access to retail clients’ data and facilitates greater and more efficient collaboration through shared processes, shared performance metrics and shared understanding of the customer. It also generates incremental revenues for the retailer.
Investors looking to buy Aimia’s stock need to consider risks. Aimia’s Air Miles competes with other forms of marketing services and loyalty incentive programs on-line. The company’s Loyalty Solutions division competes with a broad spectrum of companies engaged in one or more aspects of the customer loyalty value chain. This includes providers of loyalty marketing technology, solutions and services, strategy and analytics, program management, market research, creative communications and rewards fulfillment services.
Further, the company’s business competes with suppliers of data insight and communication services. This is particularly relevant while combining data from loyalty programs and transactional data in respect to the sale, supply or provision of enhanced data analytics services to retailers and associated consumer packaged goods vendors.
Aimia’s trademarks and intangibles have significant hidden value. The company benefits from the goodwill established for Aimia’s brand names and takes significant steps to protects proprietary information, including trademarks, through trademark laws, contractual provisions and confidentiality procedures. Employees, service providers and commercial partners are contractually bound to protect the Aimia’s proprietary information in order to control access to and the distribution of any such information.
Despite the clear risks with buying Aimia’s shares, investors purchasing the stock at these price levels are likely to do very well.