Business Lessons From The Mummy; Split; King Arthur: Legend of the Sword

Published: June 30, 2017 at 10:12 am

Last Updated on November 25, 2021

Here are some important business lessons from the box office collections of three movies released this year: The Mummy, Split and King Arthur: Legend of the Sword. As a movie buff, I am also a box-office receipts buff and all money information is from (as on June 28th 2017).

Announcement: As readers may know freefincal has an automated stock analysis spreadsheet for Indian stocks. Now I have extended it to cover US stocks listed at NASDAQ/NYSE. Do share the link with those interested.

The economics of a movie

The cost of making the movie – paying for everything from star fees to daily breakfast –  is known as the production budget.

The cost of marketing – paying reporters to write a good review, appearances in chat shows, premiers etc. – is the marketing budget.

Counterintuitive as it may seem, the more a producer spends on the movie and its stars, the more they tend to spend on marketing with a singular hope – earn as much as possible in the first few days of ticket sales.

The marketing budget could be as high the production budget – at least anywhere between 50% to 75% of it.

According to boxofficemojo, the producer can be expected to earn (on average) about 55% of the final gross.

So you can imagine what is at stake when the production budget (and therefore the marketing budget) is high!

Awful product (just about) saved by brand image and marketing

Source: Internet Movie Poster Awards


In the Mummy, Tom Cruise finally becomes an official on-screen superhero and is the first part of a dark universe “league” like the Avengers. For a movie that should have set the tone and pace of the franchise, it is downright awful.

However, as critics have panned the movie it is the biggest hit for Tom Cruise world-wide.

Production Budget: $125 million (official, could be higher)

Marketing Budget: ~ $100 million (estimated)

US Box Office: ~ $71 million

International Box Office: $275 million

Estimated profit: (275+71 -100 – 125) x 55%  ~ $ 60million.

It is way short of what Universal Studios must have expected from a big budget Tom Cruise, summer action movie and that too part of a superhero franchise.

However, even as many believe Tom Cruise is responsible for the bad script, he is also responsible for the box office. He is the no 1/2 superstar in the world (Johhny Depp being the other). It is his brand image – action + thrills + running that saved the day for Universal.

He does not rest easy on his laurels and spends hours interacting with fans – the end user. He understands the importance of marketing and does several interviews and show appearances before the movie comes out.

Just imagine the kind of profits such effort would garner had the movie been better!  All said and done, his box office charisma is alive and kicking and primarily because of the effort he puts in to talk and interact with his fans.

Great Product = Great Word of Mouth = Great Profits

Source: Internet Movie Poster Awards


Opinions about M. Night Shyamalan are not only polarised but also fluctuate wildly. This is what he has to say:

After I made _Wide Awake_, the critics said I was worthless. A year later I released The Sixth Sense (1999) and the same critics called me a master. A year later I released Unbreakable (2000) and they called me pretentious. Then I released Signs (2002) and they said I was the next Spielberg. After Lady in the Water (2006) they said I was an egomaniac and a charlatan. Now, after The Last Airbender (2010), I’m a worthless filmmaker again. When the next movie comes out I’ll [probably] get called a master. And after that they’ll call me a charlatan. It goes back and forth to the point where you can’t really take it seriously. You’re only as good as your last movie, but I feel like I’m at a point in my life [now] where I want to take risks, where I want to make movies that don’t necessarily “work”, where all the elements seem misplaced, and maybe in doing this I can find a new way of expressing myself through movies. A style of filmmaking that is my own and true to my own sensibilities. – SOURCE: IMDB

“Split”, as revealed in the last few seconds of the movie is a sequel to his “Unbreakable” (he is scheduled to film the third part titled, glass soon). In split, three girls are kidnapped by a man with 23 distinct personalities and an emerging superhero-like 24th. It is the story how girl managed to escape the “man”, played by James McAvoy (who is fantastic).

The movie is eminently watchable and has been widely praised. Now have a look at these numbers.

Production Budget: $9 million (official, could be higher)

Marketing Budget: ~ $20 million (my guess as Universal should have spent more after seeing its reception)

US Box Office: ~ $138 million

International Box Office: ~ $138 million

Estimated profit: (138+138 -20 – 9) x 55%  ~ $ 130+ million.

Now, that is a hit! If you check out M Night Shyamalan’s box office record you will agree with me that he is one of the most successful directors around. The most important reason being his movies cost so little to make. A great product need not be expensive to produce.

I am willing to bet that great word of mouth (the only reliable form of marketing and promotion) played a prominent role in the success of the movie. This, of course, requires a good script + directing + acting, all of which was present.

There is a great business lesson in the split. Focus on quality, keep costs down, market well and there is a fair shot at profits. Of course, things can still go south, but that is a chance needed for gain.

Think before you spend! Marketing can only help so much!

Special effects can make or break a movie. When you go to the mummy, you expect special effect because it is a fantasy tale.  You don’t expect to see outrageous effects in a tale about Arthur which has been done and redone several times.

If you want such a movie to come across as a superhero tale (perhaps even part of a franchise), then it better had a well known & charismatic actor as King Arthur.

Guy Ritchie has given some great hits, but this must rate as one of his biggest flops

Production Budget: $175 million (official, could be higher)

Marketing Budget: ~ $50 million (my guess)

US Box Office: ~ $38 million

International Box Office: ~ $101 million

Estimated profit: (38+101 -175 – 38) x 55%  ~ about  – $48-$50 million. (a huge flop)

The loss is a direct result of the inflated production budget, a good chunk of it went to pay the special effects. None of the cast members had an image strong enough for marketing to pay off. It is not a bad product at all, but just was too expensive to make.

Here is an example of smart spending:

  • Pirates of the Caribbean part 1 (product budget): $140 million
  • Pirates of the Caribbean part 2 (product budget): $225 million
  • Pirates of the Caribbean part 3 (product budget): $300 million
  • Pirates of the Caribbean part 4 (product budget): $250 million
  • Pirates of the Caribbean part 5 (product budget): $230 million

Disney recognised that as that series got older, profits will reduce (and they did considerably) and decided to spend less on part 4 and 5.  It should have been even lower!


Ask Questions with this form

And I will respond to them in the coming weekend. I welcome tough questions. Please do not ask for investment advice. Before asking, please search the site if the issue has already been discussed. Thank you.  PLEASE DO NOT POST COMMENTS WITH THIS FORM it is for questions only.

[contact-form][contact-field label=’Name’ type=’name’ required=’1’/][contact-field label=’Email’ type=’email’ required=’1’/][contact-field label=’Comment’ type=’textarea’ required=’1’/][/contact-form]

GameChanger– Forget Startups, Join Corporate & Live The Rich Life You want

My second book, Gamechanger: Forget Start-ups, Join Corporate and Still Live the Rich Life you wantco-authored with Pranav Surya is now available at AmazonOpens in a new window as paperback (₹ 199) and Kindle (free in unlimited or ₹ 99 – you could read with their free app on PC/tablet/mobile, no kindle necessary).

It is a book that tells you how to travel anywhere on a budget and specific investment advice for young earners.

The ultimate guide to travel by Pranav Surya is a deep dive analysis into vacation planning, finding cheap flights, budget accommodation, what to do when traveling, how traveling slowly is better financially and psychologically with links to the web pages and hand-holding at every step.  Get the pdf for ₹199 (instant download)

You can Be Rich Too with Goal-Based Investing 

My first book with PV Subramanyam helps you ask the risk questions about money, seek simple solutions and find your own personalised answers with nine online calculator modules.

The book is available at:

Amazon Hardcover Rs. 271. 32% OFF

Infibeam Now just Rs. 270  32% OFF. If you use a mobikwik wallet, and purchase via infibeam, you can get up to 100% cashback!!

Flipkart Rs. 279. 30% off

Kindle at (Rs.271) Read with free app

Google PlayRs. 271 Read on your PC/Tablet/Mobile

Now in Hindi!

Pre-order the Hindi version via this link

Do share if you found this useful

About The Author

Pattabiraman editor freefincalDr. M. Pattabiraman(PhD) is the founder, managing editor and primary author of freefincal. He is an associate professor at the Indian Institute of Technology, Madras. He has over nine years of experience publishing news analysis, research and financial product development. Connect with him via Twitter or Linkedin or YouTube. Pattabiraman has co-authored three print books: (1) You can be rich too with goal-based investing (CNBC TV18) for DIY investors. (2) Gamechanger for young earners. (3) Chinchu Gets a Superpower! for kids. He has also written seven other free e-books on various money management topics. He is a patron and co-founder of “Fee-only India,” an organisation to promote unbiased, commission-free investment advice.
Use our Robo-advisory Excel Template for a start-to-finish financial plan! Now with a new demo video!  More than 700 investors and advisors use this!
Our flagship course! Learn to manage your portfolio like a pro to achieve your goals regardless of market conditions! More than 2600 investors and advisors are part of our exclusive community! Get clarity on how to plan for your goals and achieve the necessary corpus no matter what the market condition is!! Watch the first lecture for free!  One-time payment! No recurring fees! Life-long access to videos! Reduce fear, uncertainty and doubt while investing! Learn how to plan for your goals before and after retirement with confidence.
Our new course!  Increase your income by getting people to pay for your skills! More than 600 salaried employees, entrepreneurs and financial advisors are part of our exclusive community! Learn how to get people to pay for your skills! Whether you are a professional or small business owner who wants more clients via online visibility or a salaried person wanting a side income or passive income, we will show you how to achieve this by showcasing your skills and building a community that trusts you and pays you! (watch 1st lecture for free). One-time payment! No recurring fees! Life-long access to videos!   
My new book for kids: “Chinchu gets a superpower!” is now available!
Both boy and girl version covers of Chinchu gets a superpower
Both boy and girl version covers of Chinchu gets a superpower.
Most investor problems can be traced to a lack of informed decision making. We have all made bad decisions and money mistakes when we started earning and spent years undoing these mistakes. Why should our children go through the same pain? What is this book about? As parents, if we had to groom one ability in our children that is key not only to money management and investing but for any aspect of life, what would it be? My answer: Sound Decision Making. So in this book, we meet Chinchu, who is about to turn 10. What he wants for his birthday and how his parent’s plan for it and teach him several key ideas of decision making and money management is the narrative. What readers say!
Feedback from a young reader after reading Chinchu gets a Superpower (small version)
Feedback from a young reader after reading Chinchu gets a Superpower!
Must-read book even for adults! This is something that every parent should teach their kids right from their young age. The importance of money management and decision making based on their wants and needs. Very nicely written in simple terms. - Arun.
Buy the book: Chinchu gets a superpower for your child!
How to profit from content writing: Our new ebook for those interested in getting side income via content writing. It is available at a 50% discount for Rs. 500 only!
Did you know? We have more than 1000+ videos on YouTube to explore! Join our YouTube Community!

Want to check if the market is overvalued or undervalued? Use our market valuation tool (will work with any index!), or you buy the new Tactical Buy/Sell timing tool!
We publish mutual fund screeners and momentum, low volatility stock screeners .every month.
About freefincal & its content policy Freefincal is a News Media Organization dedicated to providing original analysis, reports, reviews and insights on developments in mutual funds, stocks, investing, retirement and personal finance. We do so without conflict of interest and bias. Follow us on Google News. Freefincal serves more than three million readers a year (5 million page views) with articles based only on factual information and detailed analysis by its authors. All statements made will be verified from credible and knowledgeable sources before publication. Freefincal does not publish any paid articles, promotions, PR, satire or opinions without data. All opinions presented will only be inferences backed by verifiable, reproducible evidence/data. Contact information: letters {at} freefincal {dot} com (sponsored posts or paid collaborations will not be entertained)
Connect with us on social media
Our publications

You Can Be Rich Too with Goal-Based Investing

You can be rich too with goal based investingPublished by CNBC TV18, this book is meant to help you ask the right questions, seek the correct answers, and since it comes with nine online calculators, you can also create custom solutions for your lifestyle! Get it now. It is also available in Kindle format.
Gamechanger: Forget Startups, Join Corporate & Still Live the Rich Life You Want Gamechanger: Forget Start-ups, Join Corporate and Still Live the Rich Life you wantThis book is meant for young earners to get their basics right from day one! It will also help you travel to exotic places at a low cost! Get it or gift it to a young earner.

Your Ultimate Guide to Travel

Travel-Training-Kit-Cover-new This is an in-depth dive analysis into vacation planning, finding cheap flights, budget accommodation, what to do when travelling, how travelling slowly is better financially and psychologically with links to the web pages and hand-holding at every step. Get the pdf for Rs 199 (instant download)
Free android apps