Pre-production forecasting of movie revenues with a dynamic artificial neural network

In this paper we present the development of a model based upon a dynamic artificial neural network (DAN2) for the forecasting of movie revenues during the pre-production period. We first demonstrate the effectiveness of DAN2 and show that DAN2 improves box-office revenue forecasting accuracy by 32.8% over existing models. Subsequently, we offer an alternative modeling strategy by adding production budgets, pre-release advertising expenditures, runtime, and seasonality to the predictive variables. This alternative model produces excellent forecasting accuracy values of 94.1%.