Article ID: | iaor20104607 |
Volume: | 29 |
Issue: | 3 |
Start Page Number: | 568 |
End Page Number: | 579 |
Publication Date: | May 2010 |
Journal: | Marketing Science |
Authors: | Jank Wolfgang, Foutz Natasha Zhang |
Keywords: | marketing, forecasting: applications |
Prerelease demand forecasting is one of the most crucial yet difficult tasks facing marketers in the $60 billion motion picture industry. We propose functional shape analysis (FSA) of virtual stock markets (VSMs) to address this long-standing challenge. In VSMs, prices of a movie's stock reflect the dynamic demand expectations prior to the movie's release. Using FSA, we identify a small number of distinguishing shapes, e.g., the last-moment velocity spurt, that carry information about a movie's future demand and produce early and accurate prerelease forecasts.