What Women Want Unlocking Box Office Revenue

Shaping the future of movie marketing

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About the Author

Bryan Smith, Chief Data Scientist

Dr. Smith has a B.S.E. degree in Biomedical Engineering and

Mathematics from Tulane University and Masters’ and Ph.D. degrees

in Applied Mathematics from Northwestern University in Chicago.

He heads all research in statistics, science, and analytics at Movio,

concentrating on the development of new products that utilize Movio’s

global moviegoer database to generate analytical insights.

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Two of the All-Time North American Domestic Top 10 movies, Jurassic

World and The Avengers: Age of Ultron, were released in 20151. However,

despite the nearly US$2B earned by these two films alone, the unadjusted

cumulative box office for the year is up only 6% on 2014 and less than 1%

on 20132. This suggests that successful big-budget tentpole films are not

sufficient for driving an increase in overall moviegoing. Due to the large

production budgets, it’s also not feasible to simply produce more of these

types of films, and this may be counterproductive as it simply divides the

same viewership over a larger number of movies.

Therefore, we would like to ask the question:

Are there groups of moviegoers that attend the cinema regularly but avoid

tentpole films?

• If so, what do these groups look like?

• What types of content do they prefer?

• Would it make sense to spend more resources producing

and/or marketing content to these groups?

The Box Office Challenge

1. Box Office Pro - All time domestic gross 2. Box Office Pro - Quarterly domestic gross

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Movie Clusters

In order to better understand the preferences of different segments

of moviegoers, we first construct an audience-based network of the movies

released between 1 January 2014 and 15 September 2015. To build the

network, we take advantage of the Movio Media Research platform3. This

platform contains data describing the demographics and moviegoing history

of over eight million moviegoers throughout North America, and it provides

studios, distributors, and advertisers with a variety of tools to develop a better

understanding of how movie audiences behave. In particular, Movio Media’s

Similarity Rating provide us with a measure of the audience similarity

between each pair of movies under consideration.

This rating is based on a similarity score, which is an estimate of the

likelihood of the size of the audience intersection for a particular pair

of movies given the size of each movie’s individual audience as well as

the size of the total population. The similarity score is given by:

where p1 , p2 , and p12 are the proportions of the population that saw movie 1,

movie 2, and both movies, respectively. The similarity rating is calculated by

normalizing the similarity scores so that the similarity rating varies between

zero and ten, and the average movie’s best match has a rating of five.

Methodology

score = p12 – p1 p2

p1 p2 (1 – p1 ) (1 – p2 )

3. www.moviomedia.com

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Once we have a matrix of pairwise similarity ratings, we create the graph

by placing an edge between each movie and each of its ten most similar

movies. Each edge is weighted by the similarity rating between the

pair. Using these edges as an affinity matrix, we apply a spectral graph

partitioning algorithm4 to break the set into k clusters, selecting the value of

k that maximizes the modularity5 of the partition. We then create subclusters

by applying this algorithm again to each cluster, once again selecting the

number of clusters using a maximum modularity condition. However, if the

resulting modularity would be less than 0.2, the partitioning into subclusters

is unlikely to add much information, so we leave the cluster intact.

Audience

Once we have constructed a network, we would like to profile the audience

for each of the clusters in order to better understand the differences between

the various segments of the moviegoing population. To create these profiles,

we take a sample of one million moviegoers from the Movio Media Database

that watched at least two of the movies in the network. The sampling

is performed so that the age and gender distribution of the resulting

population is consistent with the general moviegoing population described

in the latest MPAA Theatrical Market Statistics report6.

The sample has an average age of 40, is 52% female, and watched an

average of 8.0 movies in the database at a rate of 6.4 movies per year

(the frequency is greater than the number of movies / the total time, as

not all members were in the programme over the entire period).

Peferences

An important component of each moviegoer profile is the moviegoer’s

preference for each cluster or subcluster of movies. In order to estimate

this preference, we take an empirical Bayesian approach, using a Beta

(α, β) prior, with αi =pi , βi =1-pi , where pi is the proportion of total movie views

associated with the i th cluster or subcluster. This ensures that we only assign

strong preferences to moviegoers for which we have a large amount of

information, and therefore we assume that moviegoers that have only seen a

couple of movies are most likely to have average preferences.

Sample of one million moviegoers.

4. Ng AY, Jordan, MI, & Weiss Y 2001, ‘On Spectral Clustering: Analysis and an Algorithm’, Advances in Neural Information Processing Systems, pp 849-856.5. Newman MEJ 2006, ‘Modularity and Community Structure in Networks’, PNAS, vol. 103, no. 23, pp 8577-8582.6. MPAA Theatrical Market Statistics 2014

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Tentpole

Tough Action

Animation

Horror

Bollywood

Comedy

Indie Pop

Art-house

Drama

Faith-based

Tentpole

Tough Action

Animation

Horror

Bollywood

Comedy

Indie Pop

Art-house

Drama

Faith-based

Who Doesn’t Go To Blockbusters?After eliminating movies with very small audiences, our resulting

movies dataset contained 310 movies released between 1 January

2014 and 15 September 2015. The first pass of the clustering algorithm

described in the Methodology section resulted in ten clusters.

310 movies released between 1 Jan 2014 and 15 Sept 2015, clustered by audience intersection.

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The ten clusters are described as: Tentpole, Animation, Tough Action, Drama,

Comedy, Horror, Indie Pop, Art-house, Faith-based, and Bollywood. A second

pass of the clustering algorithm was then applied, which resulted in the

breakdown of the Tentpole, Drama, Comedy, and Indie Pop clusters into

subclusters.

Once we had identified the clusters, we evaluated each moviegoer’s

preference for each one. Tentpole was the most popular cluster, with an

average preference value of 37% - meaning that the likelihood that the next

film they will see is a tentpole is roughly two in five; followed by Animation

(16%), Drama (14%), Comedy (14%), and Tough Action (11%).

In order to profile the audience that avoids blockbuster films, we partitioned

our sample of 1M moviegoers into two groups by their Tentpole preference.

We concentrate on the group, which we’ll call “niche”, whose preference for

these films was significantly less than average - for this research, we chose the

cutoff to be half of the average preference value, or 18.5%. The niche group

comprises 27% of the total sample, and compared with the “mainstream”

group - those members with an average Tentpole preference greater than

18.5% - is older (average age of 46 vs 37), more female (64% vs 47%), and

go to the movies less often (5.5 times per year vs 6.7).

The next step was to identify clusters and subclusters that were

overrepresented in the preferences of the niche group. We identified these

clusters by sorting the niche group based on their “favorite” subcluster -

i.e. the subcluster associated with each member’s highest preference.

The most popular clusters. The likelihood is approximately 2 in 5 that the next film an average moviegoer sees will be a Tentpole.

A comparison of the mainstream and niche groups’ audience profiles.

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This identified four significant groups:

1. Animation - 38% of the niche group vs 18% of the mainstream group

2. Tough Action - 20% of the niche group vs 12% of the mainstream group

3. Dramas Appealing to Female Baby-boomers - 15% of the niche group vs

2% of the mainstream group

4. Comedies Appealing to Millennial Women - 13% of the niche group vs 4%

of the mainstream group

As we outlined in the introduction, the purpose of this research was to

identify areas where there were opportunities to expand the moviegoing

population to populations that are underserved by content or marketing.

For this reason, we eliminated the first two groups from consideration as the

Animation cluster contains movies such as Minions and Inside Out, which are

simply another class of blockbuster, and the Tough Action cluster contains

a significant number of movies (34) that are well served by marketing

campaigns. Therefore, the remainder of this work will focus on subclusters

3 and 4 - Dramas Appealing to Female Baby-boomers and Comedies

Appealing to Millennial Women.

A comparison of mainstream and niche groups’ preferences.

Mainstream Group

Niche Group

38%

18%

20%

12%

15%

2%

13%

4%

Animation

Tough Action

Dramas appealing toFemale Baby Boomers

Comedies appealing toMillennial Women

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First we consider the subcluster - Dramas Appealing to Female Baby-boomers.

This subcluster consists of 23 movies, including titles such as The Hundred-

Foot Journey, Gone Girl, A Walk in the Woods, The Second Best Exotic Marigold

Hotel, and The Imitation Game. In order to profile the audience for this genre,

we selected only the moviegoers from our sample that saw at least two movies

within the subcluster. This group comprised ~13% of the total sample, had an

average age of 55, and is 59% female. On average this group goes to the movies

almost once a month, and prefers to go early in the day (54% of visits before

5pm, compared to 42% for the total population).

In addition to profiling the audience, we also collected statistics on budget

and domestic and international gross whenever they were publicly available7.

Based on the 23 movies in this subcluster for which we could find this

information, the average budget for a movie in this genre is $20M, while the

average worldwide gross is $73M, and the average Gross to Budget Ratio is 4.1.

Audience profile Gross to Budget RatioAge and gender distribution

$20 M

$73 M

Av. Budget

Av. WW Gross

4.1Av. Gross to

Budget Ratio

7. Various sources, including IMDB, Box Office Mojo, and The Numbers.

Dramas Appealing to Female Baby-Boomers

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Next, we consider the Comedies Appealing to Millennial Women subcluster.

This subcluster consists of 12 movies, including Spy, Trainwreck, and Fifty

Shades of Grey. The group of moviegoers that saw at least two of these films

made up ~13% of the total sample, had an average age of 38, and is 60%

female. Like the group above, these moviegoers go to the movies almost once

a month, but they prefer to go later in the evening, with only 34% of visit before

5pm. It is also worth noting that while the overall audience for this genre is

predominantly female, the subcluster does include some more male-focused

films such as Neighbors and A Million Ways to Die in the West.

These films performed even better than the previous group, with an average

budget of $33M, an average worldwide gross of $191M, and an average Gross

to Budget Ratio of 6.3.

Comedies Appealing to Millennial Women

$33 M

$191 M

Av. Budget

Av. WW Gross

Av. Gross toBudget Ratio

6.3

Audience profile Gross to Budget RatioAge and gender distribution

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Should Studios Target Women? We identified two clusters of movies with the following characteristics:

• they appeal to an audience that is not attracted to traditional tentpole films,

• they attract an audience that is a significant (>10%) fraction of moviegoers,

• and they are relatively profitable.

The two clusters appeal to very different audiences:

• one older and more likely to see movies during the day,

• and one younger and more likely to go at night,

• but both audiences are avid moviegoers and both are predominantly women.

This leads us to ask the question:

Should studios shift some of their resources to targeting women in order to

increase box office success?

It is well known that women are responsible for making many household

financial decisions, and across the cinema chains that participate in Movio

Media, 60% of the loyalty card holders are women. In addition, they are primarily

responsible for introducing children to the cinema, as women make up 57% of

the animated film audience. Further analysis of the financial information that

we’ve collected shows that of the 203 movies for which we could find financial

data, 45 had an audience that was more than 60% men, while 40 had an

audience that was greater than 60% women.

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The male-dominated films had an average budget of $81M, an average

domestic gross of $66M, and an average worldwide gross of $209M, for an

average Gross to Budget Ratio of 2.3, whereas the female-dominated films

had an average budget of $25M, an average domestic gross of $55M, and an

average worldwide gross of $106M, for an average Gross to Budget Ratio of 5.1.

This trend is true even when we consider blockbusters, with the male-focused

superhero subcluster generating an average global Gross to Budget Ratio of

2.9, while the female-focused action subcluster centered on the Hunger Games

franchise returned an average Gross to Budget Ratio of 4.4. This suggests that

a shift in focus towards producing and marketing films to women could pay off

not only in incremental box office, but in blockbuster returns as well.

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$81 M

$66 M

$209 M

$25 M

$55 M

$106 M

> 60% Male45 movies

> 60% Female40 movies

Av. Budget

Av. Domestic Gross

Av. WW Gross

Av. WW Grossto Budget Ratio

5.12.3Av. Blockbuster

Gross to Budget Ratio2.9 4.4

A comparison of the financial performance of movies appealing to predominantly male or female audiences.

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Movio is the global leader in marketing data analytics and campaign

management software for cinema exhibitors, film distributors and studios.

A company of Vista Group International Ltd (NZX:VGL, ASX:VGI), Movio’s mission is

to revolutionize the way the film industry interacts with moviegoers.

Movio Cinema, our flagship product, holds comprehensive marketing data

covering 52 percent of cinema screens of the Large Cinema Circuit in North

America (over 17,000 screens). Movio Media aggregates data across North

America to provide film distributors and studios comprehensive market data on

the behavior of typical moviegoers, crucial audience insights and innovative

campaign solutions. We maintain real-time, authoritative data on the loyalty

activity and transactions for many of the world’s biggest cinema chains and

capture the behavior of over 32 million active cinema loyalty members worldwide.

Website: www.movio.co

Twitter: @MovioHQ

LinkedIn: www.linkedin.com/company/movio

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