Modeling the Effects of Preview Scale and Timing on Performance of Movies: A Copula Approach

Abstract

This study develops and tests a model of both the initial and final performance of a movie, with a specific focus on the decision related to the film preview that distributors need to consider to maximize box office revenue. The aim of this study is to show that the current decisions made by distributors are suboptimal in most cases, and as a result, the authors suggest a more systematic approach. In line with previous studies, this research indicates that inviting a large audience to the preview improves the final box office performance of the movie. In addition, the results suggest that there is a quadratic relationship between the time lag from the initial preview to the opening and the final audience numbers during high season. Specifically, the model reveals that the optimal average time lag in high season is 36.5 days, compared with the actual average of 15.4 days. This model can improve managerial decision making by providing the ability to estimate the optimal time lag for specific movies to maximize movie sales.