The following article discusses the random nature of movie success in the industry as it exists today:link to article. Academics have slowly come to realize that the heads of film studios who make the decisions on what films to “green light” do no better than an ape throwing darts at a board would in their position. Movie success is not determined by critical examination of scripts or a studio head’s taste. Instead, a number of random factors from pre- to post-production are at work here. That is the reason a movie like the Blair Witch Project, which had a production budget of 60,000 dollars, can do so well while films with bigger budgets, star actors, polished scripts, and well known directors can flop. The big money invested can help make a film successful and low budget films can do well but there are three obstacles:

1) A even spending a lot of money on actors, directors, writers, etc. does not guarantee chemistry or good performances.

2) A good film with a moderate budget won’t have the big budget advantages or advertisement.

3) Most importantly, the budget only affects the film’s initial success.  Soon after release the information cascade effects take over.

People all have some information from sources like advertisements, promotion, previews, and headliners, all of which the studios can control.  Then there are reviews from critics or possibly peer reviews.  The real cascades come from what movies we see other people selecting.  I believe there are two ways we see this: 1) our friends say “hey, that was a really good/bad movie” and we see/skip the film.  Just think how much stock you put into what your friends think of a film, especially when there are up to 9 dollars per film at stake.   Think of the typical dialog when you are deciding to view a film: “What about film x?  Oh I heard that was bad.”  2) When a film has a huge or horrible opening weekend this can make a difference.  Films can distinguish themselves from others by being number 1 in the box office.  The idea is the individual reasons that if most people are investing their money in these movies, maybe I should see one of these movies.

Film studios have long sought to devise some formula for choosing which movies to produce, however, the answer is simple: make movies that people will like.   No bad movie has ever done well.  Once you figure out how to choose good movies though you have to accept that the movies success is still quite random.  Suppose there are two “good” movies with good meaning that the movie meets whatever criteria.  Assuming that you have a set of people and they choose one movie your “good” movie may or may not do well.  Therefore, success is not determined by the quality of the movie, but by dumb luck.