A Rating With a High Return: NC-17

After looking at box office returns on investment by genre, I got interested in whether children’s films generate high returns.

There is no category specifically for such movies in the OpusData numbers I have; they usually seem to fall under the adventure genre, which includes family-oriented films like “Finding Nemo” and “Toy Story 3″ as well as films for older audiences like “Star Trek” and “The Day After Tomorrow.” But I do have the Motion Picture Association of America’s ratings for films in this data set, which includes movies made from 2003 to 2012 with at least $2 million in domestic box office returns. That allows a look at how G-rated pictures, a decent proxy for children’s films, perform at the box office:

Data shown refer to films with at least $2 million in domestic box office grosses. Most data come from OpusData, with some select entries from Box Office Mojo.

As it turns out, G-rated films, on average, book domestic box office returns that are about 2.4 times production budget and global box office returns that are about 5.3 times budget. The domestic box office R.O.I. is almost exactly the same as the average for all films, and the global box office R.O.I. is somewhat better than the average for all films (about 4.5 times budget).

I bet this measure substantially understates how well G-rated films perform relative to other films though, since children’s films like “Finding Nemo” offer a lot of opportunities for lucrative merchandising. Or as Yogurt might say, moi-chendizing.

In any case, you may notice from the chart above that the film rating associated with the highest box office R.O.I. is, by a long shot, NC-17. The worldwide box office revenues for NC-17 films average 6.3 times production budget. (Films that were NC-17 and “Not Rated” were disproportionately foreign films, which is probably why such a high share of their ticket sales were abroad.)

Of course, bear in mind that the average production budget for the NC-17 films in my data set is $8.5 million, compared with about $37.5 million for all the films from 2003 to 2012 for which I could find production budgets. And there are only five films in my data set rated NC-17 â€" out of nearly 2,000 films total â€" although I did find publicly reported production budget information for all five of them.

For comparison, there are a lot of G-rated films of the last decade for which production budgets are not public. Only 40 of the 68 G-rated movies in my data set had publicly reported budgets.