1. Case Interview Workshops March 16th, 2016-Sample Case
Welcome
Introduce JHBCC board members

2. Upcoming JHGCC Info-Sessions
Thursday, March 17th Boston Consulting Group Info-Session
BCG Info-Session 5:30-7:30 PM G01 MRB (Food and Drinks)
Wednesday March 23rd McKinsey and Company Info-Session
Summer Insight Programs, MD Workshops, and 2017 Full-Time opportunities
6:30-8:00 pm Tilghman Auditorium (Turner Concourse)

3. Upcoming JHGCC Events
Friday April 15th 6th annual Biotech and Healthcare Case Competition
Register your team early
Spreadsheet available for individuals who don’t have a team
Consultants from numerous firms will serve as judges
1st place $3,000, 2nd place $2,000 3rd place $1,000

4. Goals to achieve today Reinforce the case interview process
Practice how to “structure” a case
MECE
Top-down
Hypothesize
Prioritize
Reach a recommendation for our client

5. Remember the case interview format is almost same for all cases!
Establishing Background:
Listening to the case
Understanding objectives
Clarifying questions
Structuring Approach:
Structuring in a MECE way
Hypothesizing
Prioritizing
Analysis
Quantitatively analyzing
Qualitatively analyzing
Recommendation
5 min
3-4 min
15-20 min
1-3 min
*Interviews can also be interviewer-led or interviewee-led

6. Example Case: Film Production
(Interviewee led)

7. Case Prompt
The client is a large film production studio, FilmCo, which develops and distributes full-length feature films for the U.S. and international markets.
FilmCo is planning on releasing its big budget film of the year nine months from now and is considering a new release strategy. The first component of the strategy is to release the movie in theaters on the same day around the world. The second component of the strategy is to release the DVD of the movie day-and-date (meaning releasing the DVD the same day as the theater release). FilmCo is interested in knowing whether this is the best release strategy for this movie and, if not, FilmCo would then like to know what its release strategy should be.

8. Background and Structuring: Guiding Principles
Synthesize key points and re-cap client’s goals
Clarify unfamiliar terminology
Clarify objectives
Clarify scope
Structure your analysis
Prioritize branches to ensure efficiency
Communicate your approach before diving in

9. Case Prompt
The client is a large film production studio, FilmCo, which develops and distributes full-length feature films for the U.S. and international markets.
FilmCo is planning on releasing its big budget film of the year nine months from now and is considering a new release strategy. The first component of the strategy is to release the movie in theaters on the same day around the world. The second component of the strategy is to release the DVD of the movie day-and-date (meaning releasing the DVD the same day as the theater release). FilmCo is interested in knowing whether this is the best release strategy for this movie and, if not, FilmCo would then like to know what its release strategy should be.

10. Case Prompt Clarifying Questions?
The client is a large film production studio, FilmCo, which develops and distributes full-length feature films for the U.S. and international markets.
FilmCo is planning on releasing its big budget film of the year nine months from now and is considering a new release strategy. The first component of the strategy is to release the movie in theaters on the same day around the world. The second component of the strategy is to release the DVD of the movie day-and-date (meaning releasing the DVD the same day as the theater release). FilmCo is interested in knowing whether this is the best release strategy for this movie and, if not, FilmCo would then like to know what its release strategy should be.
Clarifying Questions?

11. Information provided upon request:
FilmCo has done a simultaneous global theater release, but never simultaneous with the DVD release.
The film is the third movie of an action series. The previous two films were produced by another studio, so we have no financial data on them
Only one movie has ever been simultaneously released theatrically and through DVD, and it was by a small, independent film company.

12. Structuring Your Approach: Hypotheses and MECEness
Demonstrate a logical thought process:
Mutually Exclusive, Collectively Exhaustive (MECE)
Creativity
Prioritization (efficiency)
Example Issue Trees:
Strategic Options
Areas to Explore
Stepwise Approach

13. Structuring Your Approach
Traditional Strategy
2 scenarios: US release, Intl release, DVD release vs. Simul Theater then DVD
Expected Profits if Traditional Strategy is used
Profits=Revenues-Costs
Historical data for revenues of similar films using traditional strategy
Historical data for costs of similar films using traditional strategy
Simultaneous Release
Has this ever been done before? Do we have expertise?
Expected Profits if Simultaneous Release Strategy is used
Projections on how Revenues would change
Projections on how costs would change
Unique advantages and disadvantages

14. Revenue from Theatrical Releases of Big Budget Films (last year)
# of Films
Gross Revenue
“Blockbuster” 4
$500M
Success 10
$250M
Breakeven 15
$100M
Failure 8
$50M

15. Revenue from Theatrical Releases of Big Budget Films (last year)
# of Films
Gross Revenue
“Blockbuster” 4
$500M
Success 10
$250M
Breakeven 15
$100M
Failure 8
$50M
Thoughts?

16. Revenue from Theatrical Releases of Big Budget Films (last year)
# of Films
Gross Revenue
“Blockbuster” 4
$500M
Success 10
$250M
Breakeven 15
$100M
Failure 8
$50M
About 10% of big budget films were “blockbusters” not particularly large
About 35% of big budget films were able to generate revenue
About 75% of big budget films at least hit their breakeven point
*Tie it back to the problem. What does this mean?

17. Revenue from theatrical releases of 3rd sequels of action films (last 5 years)
# of Films
Gross Revenue
“Blockbuster” 14
$500M
Success 3
$250M
Breakeven 2
$100M
Failure 1
$50M

18. Revenue from theatrical releases of 3rd sequels of action films (last 5 years)
# of Films
Gross Revenue
“Blockbuster” 14
$500M
Success 3
$250M
Breakeven 2
$100M
Failure 1
$50M
Thoughts?

19. Data here is significantly better. More appropriate comparison.
Revenue from theatrical releases of 3rd sequels of action fiilms (last 5 years)
# of Films
Gross Revenue
“Blockbuster” 14
$500M
Success 3
$250M
Breakeven 2
$100M
Failure 1
$50M
Data here is significantly better. More appropriate comparison.
70% Chance that our film will be a blockbuster
85% Chance we will generate revenue based on it
If we assume our film will generate the average revenue we will generate $400M from theatrical release.

20. Revenue Breakdown of Big Budget Films

21. Calculating Revenues
Estimated theater revenue = ($500M∗14+$250M∗3+$100M∗2+$50M∗1)/20 = $400M
Estimated DVD revenue= $200M
Total Revenues= $600M
What about costs?
2018/11/19

22. Information provided upon request:
The simultaneous theatrical and DVD release is expected to cause a 20% decrease in revenue from theater ticket sales and a 25% increase in DVD sales.
The marketing campaign for the movie is expected to be $50M, while the marketing campaign for the DVD is expected to be $5M. With the simultaneous release, no DVD marketing campaign is required.
Pirating movies accounts for a 20% loss in total theater revenue. A simultaneous global theater release will cut this down by 25%.

23. Calculating Profits
Estimated theater revenue = ($500M∗14+$250M∗3+$100M∗2+$50M∗1)/20 = $400M
Estimated DVD revenue= $200M
Total Revenues= $600M
Separate Release: Revenues-Costs
$600M-($50M+5M)=$545M
2018/11/19

24. Calculating Profits Simultaneous Release: Revenues-Costs Revenues:
20% Decrease in Theater Ticket Revenue
$400M*(.20)=$80M=>$320M
25% Increase in DVD sales
200M*(1.25)=250M
$320M+$250M=$570M
Costs:
$570M-$50M=$520M
2018/11/19

25. Calculating Profits Separate Release: Revenues-Costs
$600M-($50M+5M)=$545M
Simultaneous Release: Revenues-Costs
$570M-$50M=$520M
2018/11/19

26. Calculating Profits
Separate Release: Revenues-Costs
$600M-($50M+5M)=$545M
Simultaneous Release: Revenues-Costs
$570M-$50M=$520M
By selling the DVD separately we can generate and additional $25M which comes from extra DVD sales
2018/11/19

27. Calculating Profits Thoughts?
OK, its clear that we should release the Movie and DVD separately, because it is more profitable. But now I want to look at whether we should release the movie simultaneously globally or not.
Pirating movies accounts for a 20% loss in total theater revenue. A simultaneous global theater release will cut this down by 25%.
Thoughts?
2018/11/19

28. Calculating Profits
Pirating movies accounts for a 20% loss in total theater revenue. A simultaneous global theater release will cut this down by 25%.
It’s clear that we will save more money if we do a simultaneous global release, as it will cut down on the theater revenue lost due to piracy.
$400M = revenue earned ( 80% of total possible revenue)
Unearned revenues (losses due to piracy) in the regular strategy: $400M/0.8 - $400M = $100M Unearned revenues (losses due to piracy) in the new strategy: 75%* $100M = $75M
2018/11/19

29. Recommendation
I recommend FilmCo do a simultaneous global theater release but a delayed DVD release.
Data suggests our film will be a blockbuster
Delayed DVD release would generate $25M additional revenue
Simultaneous global theater release will save $25M by decreasing piracy
However there are some risks involved with this strategy.
With global release we cannot reduce spending in case the movie fails in the US.
If the movie isn’t a blockbuster our DVD sales will likely take a hit
Our marketing costs are a projection and could be significantly higher