Application Case 4.6 (Continued)
at the box office before it even enters production (while the movie is nothing more than a conceptual idea). In their highly publicized prediction models, they convert the forecasting (or regression) problem into a classification problem; that is, rather than forecasting the point estimate of box-office receipts, they classify a movie based on its box-office receipts in one of nine categories, ranging from “flop” to “blockbuster,” making the problem a multinomial classification problem. Table 4.4 illustrates the definition of the nine classes in terms of the range of box-office receipts.
Data
Data was collected from variety of movie-related databases (e.g., ShowBiz, IMDb, IMSDb, AllMovie, etc.) and consolidated into a single data set. The data set for the most recently developed models contained 2,632 movies released between 1998 and 2006. A summary of the independent variables along with their specifications is provided in Table 4.5. For more descriptive details and justification for inclusion of these independent variables, the reader is referred to Sharda and Delen (2007).
Methodology
Using a variety of data mining methods, including neural networks, decision trees, support vector machines, and three types of ensembles, Sharda and Delen developed the prediction models. The data from 1998 to 2005 were used as training data to build the prediction models, and the data from 2006 was used as the test data to assess and compare the models’ prediction accuracy. Figure 4.15 shows a screenshot of IBM SPSS Modeler (formerly Clementine data mining tool) depicting the process map employed for the prediction problem. The upper-left side of the process map shows the model development process, and the lower-right corner of the process map shows the model assessment (i.e., testing or scoring) process (more details on IBM SPSS Modeler tool and its usage can be found on the book’s Web site).
Results
Table 4.6 provides the prediction results of all three data mining methods as well as the results of the three different ensembles. The first performance measure is the percent correct classification rate, which is called bingo. Also reported in the table is the 1-Away correct classification rate (i.e., within one category). The results indicate that SVM performed the best among the individual prediction models, followed by ANN; the worst of the three was the CART decision tree algorithm. In general, the ensemble models performed better than the individual predictions models, of which the fusion algorithm performed the best. What is probably more important to decision makers, and standing out in the results table, is the significantly low standard deviation obtained from the ensembles compared to the individual models.
Conclusion
The researchers claim that these prediction results are better than any reported in the published literature for this problem domain. Beyond the attractive accuracy of their prediction results of the box-office receipts, these models could also be used to further analyze (and potentially optimize) the decision variables in order to maximize the financial return. Specifically, the parameters used for modeling could be altered
using the already trained prediction models in order to better understand the impact of different parameters on the end results. During this process, which is commonly referred to as sensitivity analysis, the decision maker of a given entertainment firm could find out, with a fairly high accuracy level, how much value a specific actor (or a specific release date, or the addition of more technical effects, etc.) brings to the financial success of a film, making the underlying system an invaluable decision aid.