Comments on: Why Mark Cuban Needs The Value Per Action Ad Model http://www.jellyfish.com/blog/2006/07/25/why-mark-cuban-needs-the-value-per-action-ad-model/ The Official Blog of Jellyfish.com Sun, 23 Nov 2008 12:31:12 +0000 http://wordpress.org/?v=2.0.2 by: Sports Arbitrage System. | 7Wins.eu http://www.jellyfish.com/blog/2006/07/25/why-mark-cuban-needs-the-value-per-action-ad-model/#comment-31659 Sun, 29 Jun 2008 18:49:09 +0000 http://www.jellyfish.com/blog/2006/07/25/why-mark-cuban-needs-the-value-per-action-ad-model/#comment-31659 [...] [...] […] […]

]]> by: Dvd Movie New Release Review http://www.jellyfish.com/blog/2006/07/25/why-mark-cuban-needs-the-value-per-action-ad-model/#comment-24357 Thu, 20 Mar 2008 20:42:43 +0000 http://www.jellyfish.com/blog/2006/07/25/why-mark-cuban-needs-the-value-per-action-ad-model/#comment-24357 <strong>A Soccer Dvd Can Help Take Your Game To New Heights</strong> Soccer is the world's most popular game, and consequently there is no shortage of books, videos, and DVD's that focus on the game. Like fans of most any sports, soccer lovers are likely to want to focus on their game even when they are far away from ... A Soccer Dvd Can Help Take Your Game To New Heights

Soccer is the world’s most popular game, and consequently there is no shortage of books, videos, and DVD’s that focus on the game. Like fans of most any sports, soccer lovers are likely to want to focus on their game even when they are far away from …

]]> by: Tim Gill http://www.jellyfish.com/blog/2006/07/25/why-mark-cuban-needs-the-value-per-action-ad-model/#comment-541 Wed, 18 Oct 2006 16:44:22 +0000 http://www.jellyfish.com/blog/2006/07/25/why-mark-cuban-needs-the-value-per-action-ad-model/#comment-541 Mark, I think you make a some great points but I think there are additional economics in the works. Specifically the payoff from advertising and buying mindshare up front pays dividends down the road. As you mention they lose money on advertising each film for the their current release period. The big five movie studios spent, on average, $34.8 million to advertise a movie and earned, on average, just $20.6 million per title, in the theatre. 2. The big opening-weekend advertising dollars, even if they are expensively acquired, may pay off in later markets—specifically video, pay-TV, and foreign release. Of course these economics have changed dramatically with pirate foreign distribution, Walmart using DVD's as a loss leading traffic driver stealing market share from blockbuster, pay-TV shifting from movies to premium shows like Sopranos and Rome. All of these changes add up to a growing disconnect between the money poured into advertising for a large theatrical gross and the earnings realized in the markets that the studios depend on for their money.) 3. Places like Blockbuster peg their orders, which could range from 5,000 copies to 100,000 copies for a single title, proportionately on the results of the theatrical opening. So does HBO. I think the ad budget should be compared to the net revenue stream of the movie rather than its theatrical revenue. I wonder whether movie studios depreciate ad expense over the useful lifetime of the movie or if they take it upfront. Btw the domain VPAMovietix.com looks like it is available if you have any funding left over from your October round :) Mark,
I think you make a some great points but I think there are additional economics in the works. Specifically the payoff from advertising and buying mindshare up front pays dividends down the road.

As you mention they lose money on advertising each film for the their current release period. The big five movie studios spent, on average, $34.8 million to advertise a movie and earned, on average, just $20.6 million per title, in the theatre.

2. The big opening-weekend advertising dollars, even if they are expensively acquired, may pay off in later markets—specifically video, pay-TV, and foreign release. Of course these economics have changed dramatically with pirate foreign distribution, Walmart using DVD’s as a loss leading traffic driver stealing market share from blockbuster, pay-TV shifting from movies to premium shows like Sopranos and Rome. All of these changes add up to a growing disconnect between the money poured into advertising for a large theatrical gross and the earnings realized in the markets that the studios depend on for their money.)

3. Places like Blockbuster peg their orders, which could range from 5,000 copies to 100,000 copies for a single title, proportionately on the results of the theatrical opening. So does HBO.

I think the ad budget should be compared to the net revenue stream of the movie rather than its theatrical revenue. I wonder whether movie studios depreciate ad expense over the useful lifetime of the movie or if they take it upfront.

Btw the domain VPAMovietix.com looks like it is available if you have any funding left over from your October round :)

]]> by: mmmbeer http://www.jellyfish.com/blog/2006/07/25/why-mark-cuban-needs-the-value-per-action-ad-model/#comment-506 Mon, 25 Sep 2006 14:08:32 +0000 http://www.jellyfish.com/blog/2006/07/25/why-mark-cuban-needs-the-value-per-action-ad-model/#comment-506 I wonder, though, how many people go to the movies to just go to the movies. It seems to me that there are a few instances where movie ticket purchases are driven by need rather than want. You may have hit on one: children. I can think of a couple others: dates and escaping the heat for the comfort of air conditioning. Even for date, I'd say a vast majority are driven to movies by the "hey, I just saw an ad for that new [insert actor] movie, would you like to go?" mentality. The problem, then is that aware consumers will now simply employ your rebate program and save a few bucks which will subvert the value of any "additional demand," right? That is, the movie theatre will be doubly charged for the same advertising. Maybe I'm missing something. I wonder, though, how many people go to the movies to just go to the movies. It seems to me that there are a few instances where movie ticket purchases are driven by need rather than want. You may have hit on one: children. I can think of a couple others: dates and escaping the heat for the comfort of air conditioning. Even for date, I’d say a vast majority are driven to movies by the “hey, I just saw an ad for that new [insert actor] movie, would you like to go?” mentality.

The problem, then is that aware consumers will now simply employ your rebate program and save a few bucks which will subvert the value of any “additional demand,” right? That is, the movie theatre will be doubly charged for the same advertising.

Maybe I’m missing something.

]]>