Entertainment Management Issues - Case Study Example

MSO4730 ASSIGNMENT 2: MODULE REPORT Module MSO4730 Module Decision Making for International Managers of the Module Leader: Dr Zainab Kazim Ali Student’s Name: Student’s Number: Student’s e-mail address: Student’s degree course: Table of Contents 1.0Introduction 2 1.1Hypothesis 2 2.0Methodology 3 3.0Statistical Analysis 3 3.1Demographic characteristics 3 3.2Descriptive statistics 5 3.3Hypothesis test 6 4.0Conclusion and Recommendation 8 Appendix 9 Questionnaire 9 Regression 10 1.0 Introduction Film 2011 is a large corporation specialising in the entertainment industry. Recently the corporation put forward a proposal to expand the business by building its own chain of cinemas UK wide. Prior to implementing the proposal a research was carried out to assess the performance of three other cinema chains (that is, chains A, B, and C) which have already been established throughout the UK. Chain A, unlike the other two chains employs cinema passes which are valid for either 4 or 8 weeks (for promotional purposes). The main objective of the research was to investigate the claim by the directors that the average total monthly sales of the cinemas are £285,000. The study also, investigated whether there is significant difference in the total monthly sales of the cinemas based on the location of the cinema (that is, out of town or in town) 1.1 Hypothesis 2.0 Methodology To carry out this assessment the directors of the ‘Film2011’ corporation collected information on a random sample of 128 cinemas throughout the UK (England, Scotland and Wales). The information was collected from a random sample of 128 cinemas and analysis of the data done using Minitab 17.0. Cinemas were randomly selected from England, Scotland and Wales. Each cinema is run by one manager. Each cinema manager was given a questionnaire to complete. The questionnaire used I given in the appendix. T-test for testing difference in means and Chi-square tests of association were some of the tests used to test the hypothesis given. 3.0 Statistical Analysis 3.1 Demographic characteristics The graph below presents the chart of Gender; the graph shows that more male respondents took part in the study as compared to the female respondents. In terms of size, majority of the cinemas were medium in size (having between 400 and 1000 seats) Two chains were equally represented in the study. These were chain A and chain C which had 42 participants each. Chain B had 44 participants. 3.2 Descriptive statistics The descriptive statistics are presented in table 1 below. In the table, we observe that the average monthly total sales is shown to be £247,392, the average advertisement cost for the firms is £2,285.5, while the weekend sales and weekday sales are £157,020 and £90,372 respectively. Table 1: Descriptive Statistics: Monthly total sales, ADVERT, WEEKEND, WEEKDAY Variable N N* Mean Monthly total sa 128 0 247392 ADVERT 128 0 2285.5 WEEKEND 128 0 157020 WEEKDAY 128 0 90372 3.3 Hypothesis test First Hypothesis: In this section we test the hypothesis that the total monthly sales are £285,000. To achieve this, a one-sample t-test was conducted. From the table, the mean monthly sales is shown to be £247,392 while the p-value is given as 0.003 (a value less than 5% significance level), this leads to the rejection of the null hypothesis that states that the total monthly sales are £285,000. One-Sample T: Monthly total sales Test of mu = 285000 vs not = 285000 Variable N Mean StDev SE Mean 95% CI T P Monthly total sa 128 247392 140469 12416 (222823, 271960) -3.03 0.003 Second Hypothesis: The mean total monthly sales for location 1 is £259005.1 while that of location 2 is £233809.6; the p-value is shown to be 0.3136 (a value greater than 5% significance level), we therefore accept the null hypothesis and conclude that there is no significant difference in the total monthly sales for the two locations. That is to say, location does not matter when it comes to sales. . ttest monthlytotalsales, by( location) Two-sample t test with equal variances -------------------------------------------------------------------------------------------------------------------------- Group | Obs Mean Std. Err. Std. Dev. [95% Conf. Interval] ---------+---------------------------------------------------------------------------------------------------------------- 1 | 69 259005.1 17114.61 142164.7 224853.4 293156.8 2 | 59 233809.6 18021.56 138426.2 197735.5 269883.7 ---------+---------------------------------------------------------------------------------------------------------------- combined | 128 247391.5 12415.83 140469.1 222822.9 271960.2 ---------+---------------------------------------------------------------------------------------------------------------- diff | 25195.48 24905.5 -24091.77 74482.72 ---------------------------------------------------------------------------------------------------------------------------- diff = mean(1) - mean(2) t = 1.0116 Ho: diff = 0 degrees of freedom = 126 Ha: diff < 0 Ha: diff != 0 Ha: diff > 0 Pr(T < t) = 0.8432 Pr(|T| > |t|) = 0.3136 Pr(T > t) = 0.1568 Regression analysis The study also sought to understand the factors that predict the total monthly sales; advertisement was the most significant factor that predicts the total sales of the cinemas. In overall, the model seems to be fit to predict the total monthly sales based on the three independent variables. An increase in advertisement expenditure results to an increase in the total monthly sales made; a unit increase in advertisement expenditure results to an increase in monthly sales by £173.252. However, distance has a negative impact on the sales; a unit increase in the distance results to a decrease in monthly sales by £4210 Regression Analysis: Monthly total sales versus ADVERT, DISTANCE, GENDER The regression equation is Monthly total sales = - 113933 + 173 ADVERT - 4210 DISTANCE - 20089 GENDER Predictor Coef SE Coef T P Constant -113933 32374 -3.52 0.001 ADVERT 173.252 9.913 17.48 0.000 DISTANCE -4210 3934 -1.07 0.287 GENDER -20089 12945 -1.55 0.123 S = 72774.4 R-Sq = 73.8% R-Sq(adj) = 73.2% Analysis of Variance Source DF SS MS F P Regression 3 1.84919E+12 6.16397E+11 116.39 0.000 Residual Error 124 6.56718E+11 5296109515 Total 127 2.50591E+12 Source DF Seq SS ADVERT 1 1.82753E+12 DISTANCE 1 8904575916 GENDER 1 12754302949 4.0 Conclusion and Recommendation The study shows that the directors desire of having an average monthly sales of £285,000 has not yet been achieved; the average total monthly sales currently stands at £247,392. The results further shows that advertisement positively affects the total monthly sales and currently the average costs incurred in advertisements is £2,285.5. It is also important to note that location does not have any impact on the total monthly sales. Based on the above findings it would be prudent for the directors to concentrate more on conducting advertisements to boost their sales. The study therefore recommends that the budget for advertisements should be increased from the amount of £2,285.5 to a slightly much higher figure to enable the sales go up. Appendix Questionnaire 1. Number of cinema. (C1) 2. Cinema Chain. (C2) 1 = Chain A 2 = Chain B 3 = Chain C 3. Regional Location of the cinema. (C3) 1 = England 2 = Scotland 3 = Wales 4. Location of the cinema. (C4) 1 = In Town 2 = Out of Town 5. Size of the cinema. (C5) 1 = Small (Less than 400 seats) 2 = Medium (400 - 1000 seats) 3 = Large (more than 1000 seats) 6. Gender of the Manager. (C6) 1 = Male 2 = Female 7. Monthly Rent (£00s). (C7) 8. Distance of the cinema away from the High Street (miles). (C8) 9. Monthly Advertising Expenditure (£). (C9) 10. Monthly weekend sales (£). (C10) 11. Monthly weekday sales (£). (C11) Regression Unusual Observations Monthly total Obs ADVERT sales Fit SE Fit Residual St Resid 9 1620 131731 179456 31245 -47725 -0.73 X 19 2660 489649 320513 8116 169136 2.34R 21 2250 436429 253690 10070 182739 2.54R 22 3230 624896 401283 17415 223613 3.16R 52 2000 35065 179762 11725 -144697 -2.01R 58 3290 262801 429662 11777 -166861 -2.32R 70 3490 293700 463260 13252 -169560 -2.37R 88 3230 466037 455234 29146 10803 0.16 X 97 2100 49424 226650 9775 -177226 -2.46R R denotes an observation with a large standardized residual. X denotes an observation whose X value gives it large influence. Read More