Industry News

Business intelligence helps Warner Bros. sell Harry Potter DVDs

November 8, 2010

With the latest Harry Potter film set to open later this month, Warner Home Video, a division of Warner Bros. Pictures, is using business intelligence software to better predict sales of the series' DVDs.

Previous methods allowed Warner Bros. to forecast sales only within 40 percent, but the company is finding much stronger returns thanks to its BI solution, according to CIO magazine. The company can now more accurately estimate how many discs it needs to make and how many to provide to each retailer, helping to improve the manufacturing and distribution processes. BI is also helping Warner Bros. select optimal release dates for DVDs that will ensure high sales.

Thomas Tileston, Warner Bros. vice president of business decision support, now predicts estimates will land within 10 percent of actual sales.

Warner Bros. generates sales predictions by using custom scripts that analyze each movie according to criteria such as genre, cast, plot synopsis, box office trends and price.

As the Harry Potter franchise has grown, so has BI technology, according to CIO. "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," CIO states.

With a franchise as massive as the Harry Potter films, the difference between correct and incorrect forecasts can be devastating. At the box office, the movies have made $1.7 billion in the United States alone. Sales of the DVDs have been even more successful, grossing an estimated $3 billion worldwide, according to Box Office Spy.

But the use of BI solutions allows Warner Bros. to take advantage of the franchise's popularity by better positioning the product in the market. The company also uses its sales data from similar movies and public information about how movies from competitors such as Sony and Universal have performed in the past.

"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, you could forgo lots of revenue," CIO warns.

Source:
CIO.com

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