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Can good marketing carry a bad product? Evidence from the motion picture industry

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  • Thorsten Hennig-Thurau

    ()

  • Mark Houston

    ()

  • Shrihari Sridhar

    ()

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    Abstract

    We examine the relative roles of marketing actions and product quality in determining commercial success. Using the motion picture context, in which product quality is difficult for consumers to anticipate and information on product success is available for different points in time, we model the effects of studio actions and movie quality on a movie’s sales during different phases of its theatrical run. For a sample of 331 recent motion pictures, structural equation modeling demonstrates that studio actions primarily influence early box office results, whereas movie quality influences both short- and long-term theatrical outcomes. The core results are robust across moderating conditions. We identify two data segments with follow-up latent class regressions and explore the degree of studio actions needed to “save” movies of varying quality. We finally offer some implications for research and management. Copyright Springer Science + Business Media, LLC 2006

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    File URL: http://hdl.handle.net/10.1007/s11002-006-7416-0
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    Bibliographic Info

    Article provided by Springer in its journal Marketing Letters.

    Volume (Year): 17 (2006)
    Issue (Month): 3 (July)
    Pages: 205-219

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    Handle: RePEc:kap:mktlet:v:17:y:2006:i:3:p:205-219

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    Web page: http://www.springerlink.com/link.asp?id=100312

    Related research

    Keywords: Motion pictures; Product quality; Marketing actions; Structural equations modeling; Latent class regressions;

    References

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    1. Holbrook, Morris B, 1999. " Popular Appeal versus Expert Judgments of Motion Pictures," Journal of Consumer Research, University of Chicago Press, vol. 26(2), pages 144-55, September.
    2. Arthur De Vany & W. Walls, 1999. "Uncertainty in the Movie Industry: Does Star Power Reduce the Terror of the Box Office?," Journal of Cultural Economics, Springer, vol. 23(4), pages 285-318, November.
    3. Anita Elberse & Jehoshua Eliashberg, 2003. "Demand and Supply Dynamics for Sequentially Released Products in International Markets: The Case of Motion Pictures," Marketing Science, INFORMS, vol. 22(3), pages 329-354.
    4. K. Jöreskog, 1971. "Simultaneous factor analysis in several populations," Psychometrika, Springer, vol. 36(4), pages 409-426, December.
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    Cited by:
    1. Gazley, Aaron & Clark, Gemma & Sinha, Ashish, 2011. "Understanding preferences for motion pictures," Journal of Business Research, Elsevier, vol. 64(8), pages 854-861, August.
    2. Miroslav Karlíček & Ivan Tomek & Miroslav Křížek, 2010. "Word-of-Mouth Marketing: An Integrated Model," Ekonomika a Management, University of Economics, Prague, vol. 2010(3).

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