A new study by Pradeep K Chintagunta of the University of Chicago Booth School of Business reveals some factors that studios can control to boost how their movies perform at the box office.
Chintagunta, together with Shyam Gopinath of the University of Utah, and Sriram Venkataraman of the University of North Carolina at Chapel Hill, examined the pre- and post-release performance of 75 movies released in 2004 in 208 geographic markets in the US.
The analysis was based across three measures: nationwide consumer-generated blog volume; blog "valence" - a positive or negative sentiment written by a blogger - and studio advertising.
The study revealed that gender, income, race and age of the local population are the biggest indicators of how a movie will perform in individual markets.
Among the study's most notable demographic findings: Blog readers tend to be young, so the local readership will likely mimic the area's demographics. If the population skews older, blogs will have less impact on moviegoers' behaviour.
The biggest impact on box office performance is gender. A higher proportion of women in a population lowers box office performance with respect to blog valence and advertising much more than any other demographic feature, researchers said.
Having more women in a market makes it less sensitive to blog sentiments and less sensitive to advertising; having more young consumers in market enhances the impact of blog volume but lowers the effect of blog valence; and high income markets are less responsive to blog sentiments and advertising.
Taken together, these findings suggest that studios engaging in spot advertising may want to reduce their advertising in markets with higher income, as well as those with more women and more young consumers.
The study appeared in the journal of Management Science.