Box Office Receipts Adjusted For Inflation
This is a half-baked post, that maybe I will find some time to make more robust later. I know some of this “math” is a bit fuzzy, but I think the points are still valid for the most part.
I haven’t seen Avatar (“A Unicorn Movie” as my cousin Amanda might call it), and probably won’t. But the way the media is talking about it, I feel like I am going to be the only one that misses this film.
We were discussing this at dinner the other night (the success of Avatar) with some friends, when someone at the table noted the 3D surcharge he had to pay at the theater, which led to a conversation about how box office success is really measured in gross dollars and not fairly adjusted for ticket price differences or inflation. To see Avatar in “3D” for instance, a local theater here in Boston will charge you $15.50, while it only costs $11 to see Sherlock Holmes in the same theater at the same time. And that is just comparing two movies that are playing currently. Going back a scant five years or so, the average movie ticket price was only around $8.
So if Avatar sold 100,000 tickets today, it might gross $1.5mm+, while Shrek in 2004 might have only grossed $800k selling the same amount of tickets.
Don’t get me wrong, Avatar is still a blockbuster any way you cut it – but the news sound bites that only compare gross receipts when reporting on its historic dominance, are leaving a bit of important comparative information out in my opinion.
Over this weekend, Avatar grossed $68.3mm and Sherlock Holmes grossed $38.4mm. A drubbing based on the sheer dollars, as Avatar nearly doubled the next best performing movie. But if you adjust based on ticket sales, it gets a lot closer. Again, Avatar still wins hands down, but the spread between the two narrows considerably.
Looks like BoxOfficeMojo has a ranked list of biggest grossing movies, adjusted for inflation, here.
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Boeing does about 60 Billion in annual revenue. Hershey does about 5 billion. But when you look at how many chocolate bars Hershey sells compared to the small number of planes that Boeing does…
Hollywood doesn’t care how much you pay per ticket, just how much a movie brings in. People keeps score based on gross because it is the only way to make sure you don’t get cheated by Hollywood Accounting.
Of course internally Hollywood looks at daily dollars per screen and Avatar is 162 Minutes while Sherlock is only 134 minutes long so maybe you can get one extra showing per day of Sherlock per theatre….
Of course, I know that’s the way Hollywood measures success. Like any good business, it’s about the bottom line. I guess I get more irritated when that number is used by *consumers* as a comparative measure of success.
I think what most consumer *think* they are saying when they compare receipts, is that Movie X is more POPULAR than Movie Y, when that isn’t necessarily the case.