How Digital Marketing Campaigns Can Help Hollywood

8/12/2019 How Digital Marketing Campaigns Can Help Hollywood

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How Digital Marketing Campaigns Can Help Hollywood

(And Your Business)

Posted on 19 Nov 20130 comments

Digital Marketing In a Digital Age

Odds are your business is familiar with and has spent a lot of time considering the hugevariety of available digital marketing strategies. The world is becoming ever more digital, butwill your efforts yield any results? For everyOld Spicecampaign theres aBBH LabsHomeless to Hotspot debacle.

Youre not the only business questioning the validity of digital marketingHollywood

sticks to mainly traditional marketing techniques which has led to some criticism of theirfailure to adapt. But its foolish to anticipate any sort of adapt or die situation forHollywood; theyre not going anywhere, evenif they dont start utilizing more widespreaddigital campaigns.

That being said, there are still fantastic examples within Hollywood that warrant carefulanalysis.

The Hollywood Multiplier

Hollywood is a game of numbers. Executives smarter than I am hedge multi-million dollar

bets on a daily basis and need statistical evidence to make these decisions as informed aspossible. As someone who spends their Sundays waiting for the weekend box office results,its impossible not to notice the creative bookkeeping used by studios to determine a films

profitability.

Judging films on a commercial scale is tricky. No matter how astute you are, the studios willalways know more than you.FilmSchoolRejectssummarized the phenomenon as such:

The formula varies depending on whos doing the math, but for our purposes a general (andas close to believable as it gets) rule of thumb seems to be that a film needs to gross 1.5 to 2times its budget just to break even after production, marketing and distribution costs. So a

movie budgeted at $100m needs to gross $150-200m before the first dollar of profit will becounted.

This explains why films likeThe Lone RangerandJohn Carterhave become the posterchildren ofHollywoods impending doom,despite each grossing over $260 million dollarsworldwide. For those interested,The Lone Rangerhad a production budget of $215 millionandJohn Carters production budget was $250 million.
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$250 Million Budget $215 Million Budget

Notice the words production budget in that last sentence thats the budget used tocomplete the film, from pre-production to post-production. A large chunk of the extra money,the money that necessitates a multiplier, goes towards marketing a film.

How to Be Cost Effective

This all begs the question: Is Hollywood actually being cost effective? According to OliverLuckett, CEO of the digital marketing company TheAudience, theyre not. At all. Hereswhat hehad to saywhen he was interviewed byTheWrap:

I think theres a tremendous amount of inertia in the movie-marketing business. I think thatits status quo to spend tremendous amounts of money through broad campaigns. I think ittakes a little more work, but you can be remarkably efficient in an iterative way, and not justthis Im gonna spend 100 million dollar marketing this movie no matter what.
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Its not as though Hollywood executives are a homogeneous mass of Luddite flesh, they justhavent realized the potential value new technologies like social media outlets can have ontheir box office haul. Luckett criticizes the notion that you spend $100 million on TV ads,especially when the data tells you that your 18-to-24 audience isnt even watching TV. Hegoes on to ask If the data says you should try to reach XYZ directly through the social

graph, why arent you putting your resources there?

Its about being as cost-effective as possible. If studios didnt have a 1.5 times multiplierapplied to each of their films it would be much easier to turn a bigger profit. Luckettscompany TheAudience worked with fledgling distributorA24 Filmsto market their 2013filmsSpring BreakersandThe Spectacular Now.While neither was a box-office smash, eachturned a respectable profit, mostly by avoiding heavy marketing costs.

Each of these movies has had some of the highest per-screen averages this year, and verylittle, if any, traditional marketing goes into those movies. Those are almost entirely social. -Oliver Luckett

And this social nature pays offSpring Breakers grossednearly $32 million on a $5 millionbudget whileThe Spectacular Now has grossednearly $7 million on a $2.5 million budget.Thats success. It may not be Iron Man level success, but it doesnt have to be. By using acheaper alternative to marketing, the potential profitability of these inexpensive filmsskyrocketed.

The Hunger Games Revolution

While Oliver Luckett points to Spring Breakers and The Spectacular Now for successfulsocial media campaigns, Lionsgates 2012 film The Hunger Games represents one of thestrongest and financially lucrative campaigns of all time.

In a lot of ways, Lionsgate was the perfect studio to employ such an inventive web of digitalmarketing. As an independent studio or a mini-major, they dont have a huge, deep-

pocketed conglomerate like Viacom or The Walt Disney Company helping with marketing.With a smaller production and marketing budget they had to make sure every dollar counted.

And Lionsgate won. Look no further than the $153 million The Hunger Games opened to in

March of 2012. Skeptics can attribute this success to the books built in fanbase, but thisopening was huge. Gargantuan. Record-Breaking. The most profitable opening weekend ofany non-sequel ever. This level of success couldnt have come from fans of the book alone the only Harry Potter film to have such a successful weekend was the last in the series,Deathly Hallows Part II.

How Did They Accomplish This?

How could this be possible? How could an independent studio production with a $78 million

budget (vs. the $250 million of Harry Potters Deathly Hallows films) open to $153 million,especially when their marketing costs were extremely limited?
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Its simple. They went where their audience was, where they could make the biggest splashwith the smallest stone.

They went to social media.

According to Daniel Frankel withpaidcontent.org,most major studios create an illusion ofsocial media buzz by distributing typical film-related detritus. You have your poster, yourcasting announcement, perhaps some behind the scenes photos. Meanwhile, Lionsgate putits resources into creating rich-media elements that far outstrip the ambition of simple gamesand other movie collateral.

Before we continue, would you like to pause for an interactive tour of a Hunger Games city?How about their most decadent and imposing option,The Capitol itself? Thanks to Lionsgate,this tour is just a click away. For the first film, Lionsgate created an interactive experiencerendered from the book with painstaking detail. Fans of the book could (and still can) loginand explore a city theyd only read about. Lionsgate activated the core fan base from day

one, fired them up and let them carry the message to their friends, which in turn grew the fanbase. WithThe Hunger Games: Catching Fireopening on November 22nd, you can betTheCapitol tour sitewill be staffing up for another busy round of excursions.

For Lionsgate, it didnt stop there. They didnt only create new content that worked hand inhand with social media, they let their entire marketing effort revolve around the filmsdifferent digital platforms. Aki Karpel atfastcocreate.comexplained that Lionsgates

executives Tim Palen, Erika Schimik, and Danielle DePalma realized early on that The
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Hunger Games fan base was not only active online but already building up buzz andanticipation regarding the film.

To tap into and expand this market, they made Facebook the essential gathering place forfans and the place where they could gain information, access and community. Lionsgate first

announced the films principal cast on the Facebook page and began offering fans a chance totour the set shortly after. Danielle DePalma said it was really all our way of developing thatdirect connection and that direct dialogue with them.

Each social media platform has specific strengths and weaknesses. The Lionsgate teamstructured their campaign to exploit each platforms inherent benefits. If Facebook was thegathering place, Twitter was the best way to establish identity and communicate with non-

fans. Hunger Games TV ads announced a new hashtag that kickstarted the next aspect of theirdigital rollout. Tumblr is the most visual of platforms, so The Hunger Games created a


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Capitol Couture blog that shows off the outlandish fashion sense of the fictional Capitol.Shortly thereafter,billboards and bus stop adsappeared, spreading this really inventivestrategy even further.
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Its worth pointing out that every aspect of the campaign was inspired by Suzanne Collinssource material. The team at Lionsgate created an entirely new adaptation of this existing

product, but made sure they respected both it and its fans. Not only that, they used it almostas a business partner, turning to it for new ideas and specifics. This simultaneously earned therespect of die hard fans while convincing newcomers that this world was intriguing enough tovisit in theaters.

Was Lionsgate Really That Successful?


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The evidence is even more powerful when you look at the financial track record of otherYoung Adult adaptations. Some have been profitable, but a shocking number of them haveunderperformed, especially if we apply the 1.5 multiplier. Films adaptations come with a

built in audience, so its surprising when so many flop. For every Harry Potter series,theres another that never got a second chance. With so many external variables, its

impossible to give all the credit to Lionsgate / Summits digital marketing efforts, but itsworth noting how much bigger their success has been.

Lionsgate/Summit Productions

The Hunger Games:Production Budget: $78 millionWorldwide Gross: $691 million

New Moon:Production Budget: $50 million

Worldwide Gross: $709 million

Other Production Companies

The Mortal Instruments: City of BonesProduction Budget: $60 millionWorldwide Gross: $80 million

Beautiful Creatures:Production Budget: $60 millionWorldwide Gross: $60 million

What This Means for Your Business

This article isnt for Hollywood. Hollywood isnt going to read it, and if Oliver Luckett iscorrect then theyll be too obsessed with their current model to make any sudden changes.This article is a chance for you to take a step back and observe unbiased evidence that digitalmarketing can work.

The Hunger Games is really worth analyzing because of how much success they achievedwith their limited budget. Its true that even a mini-majors limited budget probablyexceeds your own, but they succeeded more because of their ideas and content than theirfinancial muscle flexing.

Oliver Lucketts biggest criticism in his interview is that Hollywood isnt being cost effectiveand its hurting the entire industry. Sure, Lucketts entrepreneurial effort relies onHollywoods business, but his criticisms are still completely valid. And they can apply to youand your business as well. Are you being cost effective? Should you look into a digitalmarketing campaign as well?

The first step is researching your target demographic. Which form of marketing will reach themost amount of people? If youre trying to entice a younger crowd, the 18-24 year old


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demographic Luckett mentioned, then digital marketing is your best bet. Not only is itcheaper than traditional advertising, it may actually be effective. If your audience isntwatching your television ads, then the cost is actively hurting your business.

Not only is digital marketing often cheaper, its more immediate. There are a wide variety of

analytics tools that let you monitor traffic and results in real time. You can create acommunity of supporters and potential customers, a place where two way communication iseasy and encouraged. Though this type of interaction may seem impersonable, you can hityour target market in one place, at one time. And these digital outlets are even more effectivewhen they open the door to traditional communication. You can respond to posts directly onsocial media or point customers towards other, more personal outlets.

If traditional marketing still reaches a majority of your audience, consider blending it withdigital marketing to encourage growth. Each method can complement the other, hitting all thedemographics youre looking for. If youre marketing toys, for example, you want to reachthe children and the parents with the money. You can do traditional television ads as well as a

social media blitz to make sure everyone sees your product.

The Hunger Games proved that unique content is the most alluring and effective, so considerfunneling your demographic to social media platforms where this content can be easilyaccessed and shared. You already believe in your product or service, and social media canhelp grow your fanbase. A clever, interesting, fan centered social media campaign can turn a

product you love into something completely differentsomething that everyone else willlove as well.

Lionsgate / Summit Productions:

Twilight:Production Budget: $37 millionWorldwide Gross: $393 million

New Moon:Production Budget: $50 millionWorldwide Gross: $709 million

Eclipse:Production Budget: $68 millionWorldwide Gross: $698 million

Breaking Dawn Part I:Production Budget: $110 millionWorldwide Gross: $712 million

Breaking Dawn Part II:Production Budget: $120 million

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The Hunger Games:Production Budget: $78 millionWorldwide Gross: $691 million

Other Production Companies

Percy Jackson: The Lightning Thief:Production Budget: $95 millionWorldwide Gross: $226 million

Percy Jackson: Sea of Monsters:Production Budget: $90 million


Bridge to Terebithia:Production Budget: $20 millionWorldwide Gross: $137 million

Lemony Snickets A Series of Unfortunate Events:Production Budget: $140 millionWorldwide Gross: $209 million

Eragon:Production Budget: $100 millionWorldwide Gross: $249 million

The Spiderwick Chronicles:Production Budget: $90 millionWorldwide Gross: $162 million

I Am Number Four:Production Budget: $60 millionWorldwide Gross: $149 million

The Mortal Instruments: City of Bones:Production Budget: $60 millionWorldwide Gross: $80 million

The Host:Production Budget: $40 millionWorldwide Gross: $48 million
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How Digital Marketing Campaigns Can Help Hollywood

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