Functional Shape Analysis of Movie Success in Subsequent Sales Channels

• Activity Number: 586
• Type: Contributed
• Date/Time: Wednesday, August 3, 2011 : 2:00 PM to 3:50 PM
• Sponsor: Section on Statistics and Marketing
• Author(s): Yue Tian*+ and Wolfgang Jank
• Companies: University of Maryland and University of Maryland
• Keywords: Functional Shape Analysis ; interaction term ; movies ; Word-of-mouth ; DVDs

Abstract

In this study, the goal is to understand (and predict) the shape of the sales curve for entertainment products. By ``shape" we mean whether the curve is trending up over time, or whether it is trending down and the rate at which the shape is changing. Understanding the shape of the sales curve is important for making decisions about production, distribution or marketing. We model the sales curve using functional shape analysis. Functional shape analysis first decomposes the (infinite-dimensional) shape into a set of finite dimensions and subsequently models the individual shape dimensions. In this project, we study the impact of several input shapes on the sales of DVDs over time (i.e. the output shape). The input shapes include sales in prior channels (i.e. at the box office) as well as the evolution of word of mouth about the popularity of a movie. One challenge of our model is the incorporation of an interaction term between the box office shape and the word of mouth shape. We demonstrate how to incorporate interaction terms into functional shape models and compare the resulting model to simpler approaches.