Distribution Planning to Optimize Profits in the Motion Picture Industry

• 成果类型: Article
• 署名作者: Somlo, Barbara; Rajaram, Kumar; Ahmadi, Reza
• 署名单位: Amgen; University of California System; University of California Los Angeles
• 刊物名称: PRODUCTION AND OPERATIONS MANAGEMENT
• ISSN/ISSBN: 1059-1478
• DOI: 10.1111/j.1937-5956.2010.01166.x
• 发表日期: 2011
• 页码: 618-636
• 关键词: motion picture industry; forecasting; distribution planning; theater selection; optimization

摘要

We consider the distribution planning problem in the motion picture industry. This problem involves forecasting theater-level box office revenues for a given movie and using these forecasts to choose the best locations to screen a movie. We first develop a method that predicts theater-level box office revenues over time for a given movie as a function of movie attributes and theater characteristics. These estimates are then used by the distributor to choose where to screen the movie. The distributor's location selection problem is modeled as an integer programming-based optimization model that chooses the location of theaters in order to optimize profits. We tested our methods on realistic box office data and show that it has the potential to significantly improve the distributor's profits. We also develop some insights into why our methods outperform existing practice, which are crucial to their successful practical implementation.