Big Stars Don't Always Mean Box Office Success; Ratings Are Better Predictors, Says Online Business Publication

Business Wire, March 31, 2000

Business/Technology Editors

BOSTON--(BUSINESS WIRE)--March 31, 2000

Hollywood newcomers Hilary Swank and Angelina Jolie may be able to draw big contracts after their Oscars this year, but they won't necessarily guarantee a film's box office success, according to research by a Rutgers University professor.

S. Abraham Ravid, currently a visiting professor of finance at UCLA's Anderson School of Management, has done research recently that debunks the theory that films with big stars perform better at the box office than films with lesser-known actors.

In the current issue of the MBA Bullet Point, a publication for business school graduate students (www.mbabulletpoint.com), Ravid says that while stars may rake in the big money for themselves, they don't necessarily do the same for their studios. The findings were initially published in October in The Journal of Business, a University of Chicago publication.

His study, which was done over four years, also showed that while attention and publicity mattered for a film's success, reviews did not.

The biggest factor for success, Ravid's research showed, was a film's rating. PG and especially G-rated films typically earned more money, all other variables such as budget and release dates, being equal.

G-rated films do well for one basic reason, Ravid said: There aren't many of them. On average, Hollywood produces just six G films a year. G-rated pictures, such as The Lion King, also lend themselves to enormous merchandising opportunities and big profits for studios.

MBA Bullet Point is a print and web-based hybrid of the most relevant business news and analysis. It is provided to 43,000 MBA students at 60 of the nation's top business schools, giving students the very latest in theory, criticism and research on topics important to business.