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    The Fashion Channel Harvard Business School Case Solution

    Uploaded by

    MansiShah
    The document compares the current TV ad revenue situation to various scenarios for the future. It provides data on key metrics like household reach, ratings, CPM, and ad minutes to calculate estimated annual ad revenue. It also accounts for related revenue, expenses, and net income margins under each scenario. Scenario 2 projects the highest net income of $151 million by achieving a 0.8 rating and CPM of $3.5, though Scenario 3 also yields high net income of $169 million with a 1.2 rating and CPM of $2.5.

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    © All Rights Reserved
    Download as XLSX, PDF, TXT or read online from Scribd

    The Fashion Channel Harvard Business School Case Solution

    Uploaded by

    MansiShah
    1K views2 pages
    The document compares the current TV ad revenue situation to various scenarios for the future. It provides data on key metrics like household reach, ratings, CPM, and ad minutes to calculate estimated annual ad revenue. It also accounts for related revenue, expenses, and net income margins under each scenario. Scenario 2 projects the highest net income of $151 million by achieving a 0.8 rating and CPM of $3.5, though Scenario 3 also yields high net income of $169 million with a 1.2 rating and CPM of $2.5.

    Original Description:

    Solution to Questions

    Original Title

    The Fashion Channel Harvard Business School Case solution

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    The document compares the current TV ad revenue situation to various scenarios for the future. It provides data on key metrics like household reach, ratings, CPM, and ad minutes to calculate estimated annual ad revenue. It also accounts for related revenue, expenses, and net income margins under each scenario. Scenario 2 projects the highest net income of $151 million by achieving a 0.8 rating and CPM of $3.5, though Scenario 3 also yields high net income of $169 million with a 1.2 rating and CPM of $2.5.

    Copyright:

    © All Rights Reserved
    Download as XLSX, PDF, TXT or read online from Scribd
    Download as xlsx, pdf, or txt
    1K views2 pages

    The Fashion Channel Harvard Business School Case Solution

    Uploaded by

    MansiShah
    The document compares the current TV ad revenue situation to various scenarios for the future. It provides data on key metrics like household reach, ratings, CPM, and ad minutes to calculate estimated annual ad revenue. It also accounts for related revenue, expenses, and net income margins under each scenario. Scenario 2 projects the highest net income of $151 million by achieving a 0.8 rating and CPM of $3.5, though Scenario 3 also yields high net income of $169 million with a 1.2 rating and CPM of $2.5.

    Copyright:

    © All Rights Reserved
    Download as XLSX, PDF, TXT or read online from Scribd
    Download as xlsx, pdf, or txt
    of 2

    Ad Revenue Calculator

    Current

    TV HH
    Average Rating
    Average Viewers(per Thousand)
    Average CPM
    Average Revenue/Ad Minute
    Ad Minutes per week
    Weeks /Year
    Ad Revenue per Year
    Incremental Programming Expense

    Revenue
    Ad Sales
    Affiliate Fees
    Total Revenue
    Expenses
    Cost of Operations
    Cost of Programming
    Ad Sales Commissions
    Marketing & Advertising
    SGA
    Total Expense
    Net Income
    Margin

    2007 Base

    110,000,000
    1.00%
    1100
    2
    2200
    2016
    52
    $230,630,400
    -

    Scenario 1

    110,000,000
    1.00%
    1100
    1.8
    1980
    2016
    52
    $207,567,360
    -

    110,000,000
    1.20%
    1320
    1.8
    2376
    2016
    52
    $249,080,832
    -

    2006 Actual

    2007 Base

    Scenario 1

    $230,630,400
    $80,000,000
    $310,630,400

    $207,567,360
    $81,600,000
    $289,167,360

    $249,080,832
    $81,600,000
    $330,680,832

    $70,000,000
    $72,100,000
    $72,100,000
    $55,000,000 $ 55,000,000 $ 55,000,000
    $6,918,912
    $6,227,021
    $7,472,425
    $45,000,000
    $60,000,000
    $60,000,000
    $40,000,000
    $41,200,000
    $41,200,000
    $216,918,912 $234,527,021 $235,772,425
    $93,711,488
    30%

    $54,640,339
    19%

    $94,908,407
    29%

    Scenario 2

    110,000,000
    0.80%
    880
    3.5
    3080
    2016
    52
    $322,882,560
    $15,000,000

    Scenario 3

    110,000,000
    1.20%
    1320
    2.5
    3300
    2016
    52
    $345,945,600
    $20,000,000

    Scenario 2

    Scenario 3

    $322,882,560
    $81,600,000
    $404,482,560

    $345,945,600
    $81,600,000
    $427,545,600

    $72,100,000
    $72,100,000
    $ 70,000,000 $ 75,000,000
    $9,686,477
    $10,378,368
    $60,000,000
    $60,000,000
    $41,200,000
    $41,200,000
    $252,986,477 $258,678,368
    $151,496,083
    37%

    $168,867,232
    39%

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