Using BI to Predict Harry Potter DVD Sales

Movie companies do about half of their new DVD sales in the first five days after launch, so picking the right week can be the difference between profits and losses. Overestimate demand and you're stuck with inventory. Underestimate and not only do you irritate customers, but on a hot property like the latest Harry Potter film, Harry Potter and the Deathly Hallows, Part I (which is scheduled to open Nov. 19), you could forego lots of revenue.

Since 2001, when Harry, Ron Weasley and Hermione Granger debuted on the big screen, the franchise has generated an estimated $1.7 billion in gross U.S. box office sales for distributor Warner Bros. Entertainment. But worldwide sales of Harry Potter DVDs have brought in almost double that-$3 billion-according to Box Office Spy. That's business worth getting right.

In the past decade, as Harry and his friends grew up, so did the business intelligence capability at Warner Home Video. The company has fine-tuned its sales forecasting models to ensure retailers will have enough stock to satisfy every consumer willing to plunk down $20 or so for a disc or tape, says Thomas Tileston, the company's vice president of business decision support.

Movie companies do about half of their new DVD sales in the first five days after launch, so picking the right week can be the difference between profits and losses. Overestimate demand and you're stuck with inventory. Underestimate and not only do you irritate customers, but on a hot property like the latest Harry Potter film, Harry Potter and the Deathly Hallows, Part I (which is scheduled to open Nov. 19), you could forego lots of revenue.

Since 2001, when Harry, Ron Weasley and Hermione Granger debuted on the big screen, the franchise has generated an estimated $1.7 billion in gross U.S. box office sales for distributor Warner Bros. Entertainment. But worldwide sales of Harry Potter DVDs have brought in almost double that-$3 billion-according to Box Office Spy. That's business worth getting right.

In the past decade, as Harry and his friends grew up, so did the business intelligence capability at Warner Home Video. The company has fine-tuned its sales forecasting models to ensure retailers will have enough stock to satisfy every consumer willing to plunk down $20 or so for a disc or tape, says Thomas Tileston, the company's vice president of business decision support.

To continue reading, register here and become an Insider. You'll get free access to premium content from CIO, Computerworld, CSO, InfoWorld, and Network World. See more Insider content or sign in.