Utilizing Hugh Jackman for Publicity

Drake defines publicity as media coverage for which no payment by the studio is made. While a member of the marketing department essentially, it functions at a very different frequency. Instead of being handed budgets and creating campaigns, publicity looks to utilize the talent of their movie through media use. Interestingly, Drake notes that reviews, television appearances, and interviews do not usually involve a direct payment to the media, and therefore may be more trusted by audiences. Trailers, and ads for movies are clearly attempting to spin and sell something to the consumer, but a late night interview with the star in which the movie is not the sole topic can spark peoples interest in a unique way.

Real Steel starring Hugh Jackman, took full advantage of its ability to utilize film publicity. With an estimated budget of eighty million dollars, turning a profit for this action oriented film based around the simplistic theme of robot boxing seemed imperative. While the marketing campaign was certainly high budget, a similarly strong publicity campaign was happening. Hugh Jackman was pushed as the loveable character who brought depth and importance to a movie revolving around robots boxing. Jackman appeared on most late night television shows, including The Daily Show with Jon Stewart, Jay Leno, and Conan O’brien. During interviews Jackman clearly was attempting to show that this film had heart, and while very Hollywood in its nature, it contained some layers. His attempts seemed valiant, he was charming, friendly, and very optimistic about the movie.

Despite excellent differential promotion efforts from Jackson and the publicity team to create a dichotomy of messages from the trailers, the film still has not grossed enough to make a profit. Currently at approximately 66 million dollars, the film had a strong opening weekend but has cooled off sense. Much of this may be due to mixed reviews and not the strong publicity campaign which utilized the television media incredibly well.

Using Marketing to offset level ticket prices

When it comes to pricing goods outside of the cinema industry, price discriminating is a huge factor in determining the cost to consumers. If you are selling a superior product or luxury item, you can increase the price because people will be will to pay more for the quality. If you are selling a cheaply made good, you have to change less because it not worth the money to consumers. When it comes to the movie industry all ticket prices are equal. Whether a films budget was over 200 million dollars with an Oscar winning scrip and big name actors or a simply shot on a camcorder and edited using an ipad, the cost at the box office is the same.

The article uses Spider-Man as an example often as a big blockbuster with a massive marketing budget. This film had high price actors, digitally laborious special effects, and needed filming permits in NYC which are not inexpensive. These are high sunk costs. Thus to turn a profit it was necessary to have a large marketing budget to ensure the films success (i.e. you need to spend money to make money). By launching a wide scale marketing approach that encompassed TV, print media, food industries, press appearances, ect. Producers were able to get the word out about the film. The article points out that a strong showing at the box office makes up only 15% of the films total revenue, that 15% sets the tone for the ancillary profits. Spider-Man dominated at the box office and thus kids wanted the DVD’s and merchandise that came with it. Also, due to it’s success sequels were put into production, which are producers safest bets for profits. After reading this article it is clear why some super heroes get sequels and it is because they are simply more marketable.

On the flip side a movie like My Big Fat Greek Wedding the chances of a net loss were slim. They had little to no marketing budget to speak of. Their distribution costs were low because it slowly spread across the country. Advertisement for the film was through word of mouth. Since the film was mostly unknown at the start, moviegoers may have been apprehensive about spending the nine dollars for a ticket; but if their friend recommends the movie that is better advertisement that any TV spot. A consumer is much more likely to trust their friend opinion than a flashy trailer. My Big Fat Greek Wedding is the largest grossing independent film of all time. To conclude, a movie does not need a ton of marketing to be successful, but if a significant investment has been made towards a film a marketing plan is necessary to protect those investments.

Risky Business

As Drake explains in this article the movie industry is a risky business. As he states, “Cinemagoing can therefore be considered a risky activity for consumers in that they are buying a product based upon a promise of a pleasurable experience, and risky for film financers in that they cannot guarantee demand for a particular film and cannot alter ticket price based on supply and demand.” Most people including myself thought every movie was making millions and millions of dollars in revenue. The economic models in the film industry are far more complex than most people think. Financers and investors have to take huge risks when backing a movie. They hope the demand for the movie is high enough so the financier will make money in the end, and not the other way around.

One aspect of film revenues is that it is “streamed across a lengthy period of time.” Over the last two decades DVD and the consolidation of videos are now the highest revenue earners for the movies, compared to the first week on the box office. This means that the economic models are shifting, because the change in technology more people are now viewing the movie at home or buying the DVD at a later time. Ticket sales have gone down in recent years. Consequently one key way to produce more revenue is through marketing and advertising. If the advertiser and marketer can keep the buzz around a movie for a longer time the revenues will increase. As Drake states, “Marketing is therefore a key means for the industry to establish product recognition and differentiation, and attempt to reduce these risks by highlighting the marketable elements prior to a film’s release.” The more people that know about the movie, and the more positive press can only result in higher revenues. As the economic models are changing, and as we shift to an age of digitization the movie industry is changing how to bring in profit. With a new age of social media, people in the movie industry are finding more ways to advertise. The reach of advertising today, is far greater than it was ten years ago. As we movie into the future, the film industry is going to have to adapt a new way to market a movie as well as keeping the money coming in.

Movie Theatre Experience

"Admission might buy the social experience of cinemagoing rather than to see a particular film" as a peculiarity of Hollywood films is a very interesting and relevant one to how I view going to movies. One of the greatest things about the movie theater and what they thrive on the most is the experience created for the audience. Buying a ticket, sitting in a comfortable chair staring at a big screen with popcorn and candy. For my entire life going to the movies has been seen as a treat. Something that does not happen all the time and when it does you splurge. But this has positive and negative affects on the movie industry.

The experience people have at a movie theatre is important but the main part of the experience is the actual movie. If an audience is not excited to see a movie than that experience is shot. That is were the importance of marketing comes in. Without a team of marketers, like Kacey Hagler, audiences would be more content (than they already are) to stay in the comfort of their homes for their movie viewing experience. But marketing gets an audience exciting to not only see a movie but to see a movie in the movie theatre. Their job is to make it seem like the movie theatre is the best place to see their movie. It is apparent that there is a interconnected relationship between how the marketing team can positively and negatively affect the turn out of an audience to a movie theatre. I am looking forward to learning from the managers at the movie theatre their take on this relationship.

The Risky Nature of Film Revenues

As Drake points out in his outline of the five peculiarities of Hollywood films, the revenues are spread out over a long period of time - and for most films, are in a sense never ending. While this seems like a positive, there are also some reasons that Drake chose to include this fact in his section on the risky nature of filmmaking and distribution. One negative aspect is that all of the money spent on a production, large or small, will not necessarily be recouped during opening weekend in theaters, or even during the movies full domestic release. Many movies (such as big budget movies like Transformers 3) rely on the overseas sales to break even and actually make money on the film. Additionally, there are more down-the-road money makers for movies, including DVD sales, movie memorabilia, and royalties for cable and broadcast television spots. The problem with these sources of revenue are 1.) they are extremely difficult to quantify in the pre-production phase of a movie, when all of the upfront money is paid, and 2.) many of these profits come months, even years after the release of the movie. The above reasons characterize why the revenue stream of a Hollywood film contributes to the risky nature of the film industry, and was thus included in Drake's list.
Movie marketing can certainly help reduce the risk that the longevity and variable nature of profits entails. By Building a fan base through advertisements and marketing, a producer can increase his/her confidence in the money that will be recouped through not only ticket sales in the first couple months after the movie's release, but through merchandise sales, DVD sales, television royalties, and more. Advertising and marketing makes the film less of a risk because it helps bring more in more consumers who will decide to spend their money on that film. Additionally, as Drake points out, the marketing can be catered towards each specific film, emphasizing the star cast, the popular and promotable topic, and so on to help the movie producers to get the best bang for their buck.

While theatre differ in ticket prices the movies offered within the theatres do not alter. An Indy film costs just as much as a blockbuster to the excited movie go-er. For this reason the filmmakers play a gamble – they are either about to far exceed their budget in ticket sales or not make enough to compensate for their spending’s. On of the five peculiarities of Hollywood films are in fact that all ticket prices are the same despite the cost of films.

This peculiarity can be a good thing because the first weekend for blockbuster hits is such an attraction for people that millions flock to the movies, ultimately resulting in huge ticket sales for the filmmakers. On the other side smaller (cheaper) films do not initially draw the audiences in so their money is made more gradually (if at all) over time. In these cases the risk of peculiarity is diminished. But it cannot happen without marketing. Marketing for movies are the reasons why individuals know to go to the movies in the first place. Where they are marketed and how makes a big difference for the viewers, for some movies their trailers are on television every other commercial. While some have merchandise that attracts the audiences. In the end it doesn’t matter what brings the masses to the theatres – filmmakers are just glad they came and paid for their ticket. Ultimately that money will help offset the cost for the film.

The "tent-pole" effect

One of the five peculiarities states "revenues are streamed across a lengthy time period". This is very true, DVD's are now the largest studio revenue earners. So even though a major blockbuster film can have huge box office numbers within the first two weeks of it being in the theaters, that is not where all the revenue comes from. The revenue from DVD sales now eclipse the box office sales. In addition to the theatrical release, revenue is generated through many auxiliary avenues. In 2003 there was a study that stated "domestic theatrical box office grosses" now represent only 15 percent or less of the total revenues. The other 85 percent is know as the "ancillary" markets. These "ancillary" markets can include DVD and video, the international theatrical market, network syndication and pay television. For example drake uses the term "tent-pole" effect to mean that the success in films in theaters directly effects their success in other markets. The first two weeks in the theaters are all that matters, if the movie is a big hit and draws a ton of attention then there is a really good chance that it will be successful in its "ancillary" markets. Therefore the revenues are streamed across a lengthy time period. The Sale of DVD and VHS is not until at least 6 months after the release of the movie in theaters.

Windowing is also very important. Windowing is "the strategy is releasing film over time across different media windows". This strategy can be very effective if timed right. The marketing strategy is connected directly to the windowing strategy. The use of marketing must be time appropriately so that the release of each different media window is timed perfectly with the right amount of marketing and advertising to make people aware of the release on a new platform.