futurem16 keynote: "'moneyball' for hollywood"

• “Moneyball” For Hollywood

Matthew MaroldaChief Analytics Officer

Legendary Entertainment@Legendary

#FUTUREM16

Disrupting Hollywood Paradigms with Analytics

September 2016

KONG:King of Skull Island

Hollywood Paradigm: Four Quadrants

Note: Using the US population as an illustrative example.

Traditional Hollywood Four Quadrant

Legendary Applied AnalyticsMicro Segment

Four Quadrant: 4 groups of 80 millionMicro Segment: 80 million groups of 4

Hollywood Paradigm: Spray and Pray General Population

Hard Core Fans

Market Top Dow

n

Audience

Box Office

Legendary Analytics: Invert Audience Building

Extended Reach

Efficiency Gain

Market Bottom

Up

Box Office

Audience

Hard Core Fans

General Population

Legendary Applied AnalyticsDriving All Strategic Decisions with

Data and Analytics

Inform Creative

Transform Marketing

Inform Creative

Concept and Cast Evaluations are most frequent

Transform Marketing

Identify, Understand, Reach, Persuade

Individuals

Goal:Reduce Media Spend by 15-20%

People and Locations

Based in Boston

Extension in LA

Diverse set of over 70 people and growing

People and Locations

Based in BostonExtension

in LAGrowing in Beijing

Diverse set of over 70 people and growing…and expanding

Virtuous Cycle

Virtuous Cycle

Conversation

SocialPeople

Content

• 1.5B email addresses• 200M households with PII• Hundreds of attributes per

person from many sources

• 500M Twitter profiles• 100M Facebook profiles• Hundreds of attributes per

person from many sources

• Billions of Tweets• All of Reddit• All of Wikipedia• Thousands of news sites

and blogs

• Box Office by theater for all movies since 2007

• All US ads run since 2007• Meta data by second for

thousands of movies

Substantial sets of data integrated in unique ways

Virtuous Cycle

Web Traffic

WarcraftDawn of the Planet of the Apes Hobbit 2 Hobbit 3

Hobbit 1

Godzilla

Jurassic World

Conversation Analysis

Social Interactions by Geography

Extensive analyses using traditional and innovative techniques

Virtuous CycleAnalysis DescriptionSurvey Analysis • Run specific surveys with the latest techniques

Digital Analytics • Analyze trends, conversation on social, search

Structured Topic Modeling

• Analyze Twitter and Reddit text to segment conversations into specific topics for analysis

Follower Network • Classify fans based on interpretable segments of a network (Basketball fans, Bollywood fans, etc.)

Entity DNA • Apply machine learning to a text and categorize language by specific topics

Emotion Classification

• Categorize commentary into groupings of emotions and then define topics in the emotions

Image-based Segmentation

• Segment based on types of images being shared on social media

Propagation Inference

• Target "influencers" based on empirical study of how frequently a person's posts are propagated

Propensity Models • Identify and reach high-likelihood individuals

Campaign Data • Learn from campaign to refine strategy/tactics

Virtuous Cycle• Build audience profiles• Create hundreds of microsegments• Identify key persuadable points• Produce detailed, actionable insights• Uncover persuadable audience

• Measure changes in intent• Test and develop creative

Actionable insights emerging from data and analytics –at a rate of over 50 per movie per week

Virtuous CyclePopulation

Aware

Interested

Converted

Individuals Interests DemosAudience

Manage a specific Audience based on Awareness and Interest to drive Conversion

Virtuous Cycle

Deep API integration allows for scale execution and sophisticated reporting

Virtuous Cycle

Campaign data allows for continual optimization

APPLIED ANALYTICSSOPHISTICATED TARGETED MARKETINGApply and adapt established models and tools in ChinaDrive marketing decision making Create closed loop to analyze, predict, and drive ticket sales

TARGETED MARKETING BASED ON STATISTICAL MODELING

1) Identify geographies most likely to have strong box office2) Utilize unique data relationships to analyze billions of data3) Train a model to predict likelihood of interest4) Focus on persuadable audience (not “givens” or “nevers”)5) Optimize creative by micro-segments6) Deliver large scale ads7) Use actual ticket pre-sales to calibrate models8) Drive ticket sales (including chase)

City level Box office analysis

Audience creative reception analysis Model coefficients affect analysis

• Investment• $160 million Production• $120 million Advertising

• Testing• 8 audience screenings (including extensive biometrics)• 3 different versions screened in the same night (a record!)

• Reception• 26% by critics on Rotten Tomatoes• 83% by fans on Rotten Tomatoes• 98th Percentile in ratio of Critics to Fans reception

WARCRAFT CHINA CASE STUDYTHE NEXT PARADIGM DISRUPTED

Extensive global release in June 2016for a unique property

LEGENDARY EASTMarketing and distribution local expertise

APPLIED ANALYTICSTactical and targeted digital campaign

MARKETINGCentrally managed campaign with extensive bespoke creative to support partners, exhibition, licensing and large scale eventing

STRATEGIC BUSINESS PARTNERSIntegrating the resources of strong influential partners into one of the widest reaching campaigns in China

LEGENDARY TEAM APPROACH

APPLIED ANALYTICS: WARCRAFT CHINA CASE STUDYTARGETED MARKETING AT SCALE TENCENT PLATFORMQQ tips window: 34.3M targeted ads.

BAIDU PLATFORMS

Nuomi: 29 million individuals targeted.Maps: 17 million individuals targeted.Music: 16 million individuals targeted.

Search ads: Thousands of keywords coveredDelivered 79 million impressions (high CTR at 3.5%)

150+ MILLIONTARGETED INDIVIDUALS:

6.5x Return on Media

3.0x More Likely to Buy a Ticket IMPACT:

APPLIED ANALYTICS: WARCRAFT CHINA CASE STUDYTARGETED MARKETING AT SCALE

0.00

0.40

0.80

1.20

1.60

2.00

2.40

2.80

Control Treatment AverageTreatment Top Segment

Tick

et P

urch

ase

Rate

(%)

+200%

0.44%

1.27%

2.30%

+400%

Exposed group converts at 200% higher rate, while the top segment at 400% higher

WARCRAFT CHINA CASE STUDYTHE NEXT PARADIGM DISRUPTED

$300M+ box office in its first week, $430M+ total, with a record setting $230M in China