It's three days before Christmas and you're out doing some last-minute shopping downtown. Sitting at a traffic light, you see a bus drive by with a huge ad for the latest Disney movie, something about a purple unicorn. You saw something last night on TV about the crazy special effects they used to make the unicorn fly. Huh, you think, maybe your kid would like to see it.
At the mall, it seems like that unicorn is everywhere. They're selling stuffed unicorns in the toy store and offering unicorn rides next to the line for Santa Claus. (Speaking of special effects, how did they get the horns to stick to those ponies?) You buy a Coke at the food court and darn it if the can isn't purple!
Back at home, you turn on the TV and every commercial break has a different trailer for the unicorn movie. You go online to check the latest headlines and there's a big interactive banner ad featuring that lovable unicorn at the top of the "New York Times" Web site. Literally everywhere you look, someone or something is reminding you that the unicorn movie opens on December 24th! Guess where you'll be on Christmas Eve?
Hollywood movies grossed $26.7 billion worldwide in 2007 [source: Motion Picture Association of America]. No other form of entertainment comes close to equaling the earning power of movies. One of the main reasons movies are so successful is that they're sold to us so effectively. Movie marketing is the art and science of convincing consumers to buy movie tickets.
Although the movie industry takes in billions of dollars a year, very few Hollywood movies actually make a profit. That's because it costs a tremendous amount to make a major studio movie. The average production budget of a major studio movie reached $70.8 million in 2007. But to sell that movie to the public, studios spent another $35.9 on marketing for a total budget of $106.6 million per picture [source: Friedman]. Hollywood relies on a few runaway hits each season to make up for the majority of films that fail to break even.
The uncertainty of the movie business makes the job of the movie marketer even more important. Whether a movie is Oscar worthy or downright lousy, the movie marketer has to figure out a way to fill those seats at the multiplex. Keep reading to learn the basics of movie marketing, some proven techniques and why it's such a challenging job.
Movie Marketing Basics
Movie marketing is also known as movie advertising and movie promotion. Every major Hollywood studio and movie distribution company has an internal department devoted to promotion. The promotions department is responsible for designing and implementing an effective, cohesive advertising campaign across several different media platforms, including theatrical movie trailers, newspapers, magazines, television, radio, the Internet and billboards.
The movie business is cyclical and seasonal by nature [source: Vogel]. Major studio releases are clustered during the summer, Christmas and long holiday weekends like Thanksgiving, Memorial Day and Labor Day. With so many high profile movies fighting for the same audience, movie marketers need to figure out how to make their films stand out from the pack.
In recent years, the general tactic has been to "go big." For expensive, blockbuster movies, the marketing campaign alone can cost as much as half of the total production budget [source: Vogel]. So if a film costs $80 million to make, the distributor might spend $40 million on advertising and promotion. In 2007, the average marketing budget for a theatrical release from a major Hollywood studio was $35.9 million [source: Motion Picture Association of America].
The hope, of course, is that all of this marketing money will pay off in ticket sales. One of the most important indicators of the success of a movie marketing campaign is the gross box office sales from the first weekend of a movie's release. Opening weekend sales are a direct reflection of how much buzz and excitement has been generated by the promotional campaign.
Even if a movie stinks, strong opening weekend numbers can be enough to break even or earn a small profit for the studio. It's not uncommon for large Hollywood movies to make over 40 percent of their gross profits in the first week of release. Once the word spreads that the movie isn't worth the money, some blockbusters experience huge drops from the first weekend to the second. The most notorious example is Ang Lee's "Hulk," which grossed 47 percent of its total earnings in it's opening weekend, then made 69 percent less in its second weekend [source: Box Office Mojo].
Every movie is different and the promotions department must figure out what type of campaign will be the most effective at reaching the target audience. This requires researching the tastes and media-consuming trends of the target audience. Based on this research, the movie marketers decide how much of their budget to spend on each different media outlet. According to the Motion Picture Association of America (MPAA), here's how its member studios decided to allocate their marketing budget in 2007:
- Newspapers: 10.1 percent
- Network TV: 21.6 percent
- Spot TV (purchasing commercial "spots" from individual TV stations): 13.9 percent
- Internet: 4.4 percent
- Theatrical trailers: 4.2 percent
- Other media (includes cable TV, radio, magazines, billboards): 24 percent
- Other non-media (market research, promotion/publicity, creative services): 21.8 percent
[source: Motion Picture Association of America]
In the next section, we'll look at the specific strategies that movie marketers use to convince moviegoers to fork over $8 or more for their films.
Movie Marketing Strategies
The theatrical trailer is often the first chance to promote a movie to its target audience. Starting up to a year before the release of a major studio movie, distributors run movie trailers that are meticulously edited and audience-tested. The idea is to give moviegoers a taste of the laughs, special effects and plot twists of the studio's upcoming releases, while leaving them wanting more. It's an art form that's usually handled by special trailer production houses.
About the same time that the first trailers hit the theaters, the movie studio will unveil an official Web site for the film. Typical movie Web sites allow visitors to view multiple versions of the trailer, watch behind-the-scenes interviews and mini-documentaries, read plot synopses, download cell-phone ringtones and desktop wallpaper, play games, chat in forums and even pre-order tickets. The official movie Web site is only the beginning of a much larger Internet marketing campaign.
As the release date of the film draws closer, movie marketers try to get early favorable press coverage in newspapers, magazines and on entertainment TV shows. The main movie publicity tactic is something called a press junket. At a press junket, journalists, entertainment reporters and movie critics are flown out to a special location for a day or weekend of interviews with the stars and creators of the film. The actors, directors and screenwriters sit in separate rooms and the reporters are brought in one by one to ask their questions.
Press junkets are highly controlled environments where interviews are often attended by a publicist, who make sure interviews never veer from positive topics [source: Rosenbaum]. If you've ever seen a TV interview with an actor sitting in front of a poster of their movie, that's from a press junket.
Weeks before the movie opens nationwide, the promotions department starts an all-out publicity blitz. The idea is to bombard the public with so many images and promos for the movie that it becomes a "can't miss" event. Movie marketers will plaster the sides of buses with huge ads, place billboards all around the city, run tons of teaser trailers on TV, place full-page ads in major newspapers and magazines, and the movie's stars will show up on all of the major talk shows.
The Internet is proving to be a prime spot for these publicity blitzes. Promoters can place rich, interactive ads on the Web sites most trafficked by their target audience. They can also release behind-the-scenes clips, bloopers and other viral videos on video-sharing sites like YouTube. Or they can release different media clips and let the fans create their own trailers.
Another popular strategy is to use highly visible product tie-ins and corporate partnerships. In the weeks leading up to the release of "How the Grinch Stole Christmas," images of the green Grinch appeared on packages of Oreos, boxes of Froot Loops and cans of Sprite. Even the United States Postal Service got into the act, stamping letters with special "Happy Who-lidays!" messages [source: Finnigan]. For marketing children's movies, the Holy Grail is getting promotional goodies in McDonald's Happy Meals.
One final movie marketing strategy is the publicity stunt, an orchestrated media event where someone does something incredibly silly, dangerous or spectacular to draw further attention to the opening of the movie. An example is when the promoters of "The Simpsons Movie" transformed dozens of nationwide 7-Eleven convenience stores into replica's of Springfield's own Kwik-E Mart [source: Keegan].
Unfortunately, movie promotion is not an exact science. Read about some common problems with movie marketing in the next section.
Problems Associated with Movie Marketing
The trickiest part of movie marketing is that every movie is different. Every film is its own standalone product with its own potential market segment. Just because your last kid's movie was a huge hit doesn't mean that audiences will come in droves to the next one. There's no formula for success, so marketers must be creative to grab the public's attention.
Moviemaking is an inherently risky business. Movie marketers try to alleviate some of that risk by heavily promoting expensive films. Unfortunately, in the process, they make the films even more expensive by adding on a huge marketing budget. There's always a chance that the marketing campaign will stink just as bad as the movie, and suddenly the studio has thrown away twice the amount of money. For example, Oliver Stone's epic "Alexander" cost $155 million to make and $60 million to market domestically and only took in $167 million worldwide [sources: Box Office Mojo and Waxman].
The problem is that most big-budget movies are marketed to the widest audience possible. Ads are placed on every TV network and stuck in every newspaper and magazine. There's no focus. Chances are that with every blockbuster movie marketing campaign, millions of dollars are lost on people who would never see the movie, no matter how good it is.
One solution is the idea of the nichebuster, a smaller movie marketed heavily to a highly specific audience segment, say skateboarding fans or religious groups [source: Schonfeld]. One of the proponents of this idea is 20th Century Fox, which recently launched a division called FoxFaith that will produce and market movies to a Christian, family-oriented audience. This is called demographic marketing rather than selling movies according to traditional genres like action, romantic comedy, thriller, et cetera [source: Movie Marketing Update].
A final problem is that moviegoers are more media savvy than ever. While children are highly susceptible to advertising, many adults recognize the publicity blitz for what it is: publicity. Some moviegoers are starting to complain about the sheer magnitude of hype that surrounds major studio releases.
This is another reason why the Internet is proving to be a powerful marketing tool. If studios play their cards right, they can capitalize on social networks, viral video sites and other online communities to sell their movies for them. The Net Generation moviegoer is much more likely to trust his chat buddy's opinion than some talking head on E! Entertainment Television.
For even more information on the movie marketing, the movie industry and related topics, see the links on the next page.
More Great Links
- "5 Ways to Fix Warner Bros." Schonfeld, Erick. Business 2.0. March 22, 2006. ("A High-Wire Act at Warner Bros." Waxman, Sharon. The New York Times. Nov. 14, 2004. http://www.nytimes.com/2004/11/15/business/media/15warner.html?_r=3&oref=slogin&oref=slogin&oref=slogin
- "Biggest Second Weekend Drops." Box Office Mojo. http://www.boxofficemojo.com/alltime/weekends/drops.htm
- "Beth Goss - senior vice president of promotions, Universal Pictures Distribution, marketing strategy." Finnigan, David. Brandweek. March 26, 2001. http://findarticles.com/p/articles/mi_m0BDW/is_13_42/ai_72631303
- "Entertainment Industry Economics: A Guide for Financial Analysis." Vogel, harold L. Cambridge University Press, 2001. http://books.google.com/books?id=qxynbtC3JQgC&pg=PA117&lpg=PA117&dq=movie+studios+net+profit&source=web&ots=K3bl9c0WbT&sig=5jdMdKhDPaHuCjCMBxXOqjR8tnc&hl=en&sa=X&oi=book_result&resnum=10&ct=result#PPR7,M1
- "Fox Launches Second Demographically-targeted Specialty Division with FoxFaith." Movie Marketing Update. http://www.indiescene.net/archives/000785print.html
- "Junket Bonds." Rosenbaum, Jonathan. Chicago Reader. http://www.chicagoreader.com/movies/archives/2000/1100/001117.html
- "Movie ticket sales hit record." Friedman, Josh. Los Angeles Times. March 6, 2008. http://articles.latimes.com/2008/mar/06/business/fi-boxoffice6
- Schonfeld, Erick. Business 2.0. "5 Ways to Fix Warner Bros." March 22, 2006. http://money.cnn.com/magazines/business2/business2_archive/2006/04/01/8372810/index.htm
- "Theatrical Market Statistics 2007." Motion Picture Association of America. http://www.mpaa.org/2007-Theatrical-Market-Statistics.pdf
- "The Smartest Movie Marketing Ploys." Keegan, Rebecca Winters. Time. July 11, 2007. http://www.time.com/time/arts/article/0.8599.1642448.00.html