system
Given the following post, respond as if you're commenting on Reddit:
human
ELI5: Why does hollywood produce these straight to video movies which are clearly terrible and how do they manage to get good actors in them?
gpt
Another often overseen aspect of this is to keep the "side-industries" busy and flourishing, because the studios depend on them so badly for their major blockbusters. And this could include everything from hair stylists, to on-set catering services, animation artists, CGI modelers, camera and gear lenders etc.

For the studios producing such a direct-to-video movie sometimes is a sheer zero-sum-game, if you take a look just at the balance between expenditures and revenue. But the indirect impact, which you can't account to directly related revenue might be important.

For example they might fulfill contracts like "we will produce 60 films in 2014 with equipment rented from you" or might be able to license more content to all those different content providers (cable networks, netflix, itunes, etc.), we sell you the licenses for this package of "100 movies and includes those 20 blockbusters".

And sometimes — especially in the case of movies targeted towards children — it is to give a decaying trend another little upward marketing spike. Young children are less aware of the concept of "contemporariness", so if "Pixar's Cars (1)" is shown to them today maybe via cable, parents might feel the urge to show them the other parts as well. For the parents it's an easy way to keep their kids busy. Or maybe it's due to sheer pressure by their kids, when they see the other ones in store or in the digital library. Another important aspect is that the kids might respond strongly to otherwise old merchandising or licensed products that are still in stock and that otherwise needed to be recycled, if they don't get sold..

Especially in retail those type of agreements actually are common.
The retailers that sacrifice valuable shelf-space for a merchandising article (let's say character figures of Disney movies) want some guarantee that those will be demanded by their customers. Those deals are closed way ahead of the actual release (sometimes even completion of the creation) of the movie, as the items need to be manufactured (mostly) overseas and distributed world-wide in advance. So no one knows for sure how huge of a success a movie will be. Those are all bets...some are safer (next Pixar block-buster), some are more risky.

Sometimes you'll see agreements in the manner of being very cross-promotional. 
Deal with cable companies might include that the movie should be aired at specific times of the year or on very specific days, like around christmas or thanksgiving etc. and at the same time you might notice that a certain fastfood chain "recycles" those figurines once again as a gimmick in their kid's meals, while there occurs to be a printed ad in a kid's magazine or comic simultaneously.

This is all planned months/years ahead and a pretty complex field to work in.
The trickiest part is that you can't directly measure your marketing success, because there are so many influencing factors that the data is kind of corrupted by it being so scattered. But as we all can clearly see...it's possible :)