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David Poland

By David Poland poland@moviecitynews.com

Give It A Name: Media Shakeout Sidebar – Media Movie Obsessions That Don’t Matter

THESE THINGS SIMPLY DO NOT MATTER… NO MATTER HOW MUCH THE MEDIA HARPS ON THEM
Outliers – The vast majority of media stories about the movie business focus on outliers, not the industry as a whole. Those outliers, good and bad, have never been a good representation of the health of the industry.

Tickets Sold – A recently popularized stat, there are few things more irrelevant, except if you are analyzing the exhibition business. I believe a healthy exhibition business matters greatly, but for studios, this stat is actually inverted. If you can raise revenues while showing a film to fewer people, that’s a plus, as the potential non-theatrical market is bigger. Obviously, increases in both is the most preferable scenario. But the argument that fewer tickets sold is a problem does not take into account that product is being exploited by the same distributors in non-theatrical markets. The bottom line matters. How a film gets there does not matter much to the investors in films.

Weekend-vs-Weekend Annual Comparisons – Simply silly on the face of them… which is about as deeply as most reporters think about this. There are at least a dozen significant variables that change from year to year and make these comparisons specious, aside from being a starting point for analysis, not analysis on its own.

Domestic Gross Only – For some, like Adam Sandler, the domestic number is still king… though even he has made significant inroads into better international grosses in the last few years, scoring three $100m international grossers since 2008. But when comparing him to others, intentional matters. And when looking at movies, foreign is now more important than domestic in a majority of studio releases. Even this summer, with Thor as the outlier with 60% international, The Avengers will be the #2 Marvel-produced Marvel title in international percentage ever, with somewhere between 55% and 60% coming from international when all is said and done, delivering more than 2.5x the previous top M-p-M-t’s international (Iron Man 2). The international improvement alone represents almost a third of the total worldwide box office for this film.

Weekend Box Office Rank – Pure marketing bullshit. It can mean something, but only because of the other contexts in which the success is reflected. The most profitable movie of Summer 2008 was Mamma Mia!, not The Dark Knight… and it opened to $27.8m and never was #1 in any weekend. At this point, I believe this stat does more damage to movies not being hyped as #1 than it does help films that are already winning a weekend or weekends.

Studio Market Share – An oldie, but a goodie. Completely meaningless. How are the movies funded? Is the studio just distributing or is it making money on the production side? Or is it doing bug numbers distributing films that are losing money? And what about international?

Social Media On Opening Weekend – There is, simply, no consistent information even suggesting that what is huge in Social Media converts to tickets sold. Moreover, there is no consistent data that shows any correlation between Saturday grosses and Social Media. The same foolishness has been attached to cell phones, text messaging, MySpace, and now Twitter. Going to the movies has a different kind of call to action than Social Media. This is not to say that word of mouth doesn’t matter and that much of it is now via Social Media. But when something like this becomes hip to cite, I look to consistency, not experiential hype.

AND TO A LESSER DEGREE…
Theatrical Gross Without Context – A $200 million production in 2012 that grosses $400 million worldwide is likely to lose money. (Not so much in 2007.) A $30 million production that grosses $80m domestic is likely to make good money. It’s that simple and that complex. There are broad equations we can use to guess at profitability, though no journalist has all the details needed and sometimes we can get closer than other times floating on the details we do have available to us. But it’s all about context.

Quality – I have always said that opening weekend has nothing to do with quality. This is a slight overstatement. But only in outlying situations. Much as we all like to believe that quality counts, the truth is that in most situations, the opening week pretty clearly defines the box office grosses to come. I’d say that 10% or so of films break that cycle, up or down.

Awards – They can matter for indies and events, like The Oscars, can be used effectively in strategizing release choices. But in and of themselves, not very important.

People Over 35 – Sorry. I am in this category too. And we can make some films hits and very profitable. But in a good year, that’s 10% of the domestic market. (I am neither an expert in local international markets nor on the revenues from local films in each market, so breaking my own rules, I can’t include non-major-studio international in this issue.) The theatrical movie business is driven by the under-35s… even if they are spending money we gave them in allowance. (a joke.) But as important as we are to ourselves and as much as we love movies, we don’t show up often enough and in big enough numbers to be a primary focus of major studios. We are a niche.

20 Responses to “Give It A Name: Media Shakeout Sidebar – Media Movie Obsessions That Don’t Matter”

  1. BoulderKid says:

    Two points of contention; first your thesis regarding total tickets sold presumes that the same total number of viewers exist for a film that sells fewer tickets in theaters as one that sells more. I believe that a film that sells fewer tickets such as a Green Lantern or Thor to a Batman or Avengers simply reflects that less people want to see the film and that DVD sales and VOD will reflect this. I’ll concede that this is more true for spectacle films than something like “Midnight and Paris” where the theatrical experience is less divergent from the home viewing experience. Still, it has to be troubling to studios when a film needs 3D and IMAX surcharges and ticket price inflation to reach the same levels as films from a view years ago. A film that puts more butts in the seats will lead to more residual word of mouth down the road to other consumers and in many cases provide a double dip when those who saw a film in theaters buy the DVD or watch it on VOD.

    Secondly, quality will always matter. I’ll concede that opening weekends are largely driven by marketing and familiarity with the source material if applicable. However, there is a clear correlation between the quality of a film and business after the initial weekend. I think you still recognize this by mentioning the “opening week” rather than just the weekend. It seems to me that the monday through thursday after opening weekend is largely driven by water cooler word of mouth, but I digress. Poor critically received films rarely have strong legs and while not all well reviewed and thought of movies multiply their opening weekend four or five times by the end of their run, they are far more likely to do so than something that is universally regarded as mediocre. We’ve seen this with comedies (Wedding Crashers, the Hangover, various Apatow films, 21 Jump Street); comic book films (Nolan Batmans, Avengers, Spiderman 1 and 2); and more adult fare (Girl With the Dragon Tattoo, The Social Network, The Fighter, The Help, Moneyball).

    After opening weekend, when word really gets out beyond the insulated cinephile/critical community bubble and in to the schools and offices, no one wants to be the sap who pays full freight to see a real dog of a movie three weeks after its been released.

  2. Luke K says:

    DP, you’ve got a typo under Domestic Gross Only. You say Intentional matters when I believe you mean International.

    Other than that, good article. I get frustrated whenever I read anyone quoting just domestic. I was in London on a meeting with one of the studios and the head of marketing was telling me that he sees a time in the near future where International will have the most important seat at the table due to revenue splits. You saw some experimenting with that this year with Avengers and Battleship going out first over there. It will be interesting to see how things trend in the coming years with International becoming such a big piece of the pie on some films,

  3. Joe Leydon says:

    And now, for all of David’s ADD readers, here’s the Reader’s Digest version: I AM DAVID POLAND, GOD OF FILM INDUSTRY ANALYSTS. GAZE UPON MY SUPERIOR OBSERVATIONS, AND DESPAIR.

  4. movieman says:

    quality will always matter.

    Really, Boulder?
    Then why is that thoroughly mediocre Marvel Miracle on its merry way to becoming the third highest grossing film in history by weekend’s end?
    Breathless mega hype, mass brainwashing, sure.
    But “quality” has zilch to do with it.

  5. christian says:

    Joe FTW.

    Movieman, your tastes are rather eclectic. THE AVENGERS is a cro_wd pleaser. Pretending that its not is the fatal flaw in DP’s number labyrinth.

  6. movieman says:

    “Airport” and “Love Story” were crowd-pleasers in 1970, too, Christian.
    And I don’t think anyone would argue that quality had anything to do with it.

  7. sanj says:

    DP – if awards aren’t important then will you stop doing dp/30 oscar watch ?

  8. Foamy Squirrel says:

    Leydon channeling Murphy. 😉

  9. Yancy Skancy says:

    But “quality” is subjective. AIRPORT and LOVE STORY were both Best Picture nominees as well. Word of mouth hits become so because a lot of people think they are “quality.” I doubt many folks said, “You’ve got to see LOVE STORY–it’s so cheesy and maudlin and dumb.”

  10. christian says:

    All this number-crunching removes obvious components such as repeat viewings, huge comic book fan base, and the “anecdotal” fact that critical folks like myself who haven’t enjoyed any of the Marvel films sine IRON MAN, love this one. I’m immune to marketing hype but not to my own desire. T’aint no mystery here folks. And why did BATTLESHIP sink? Nobody cares.

  11. Joe Leydon says:

    Foamy: And by the way, I didn’t necessary say he was wrong to feel that way. But if you’re someone who wants things simplified — and yes, I’m looking at you, Sanj — wouldn’t you agree I provided a public service?

  12. Foamy Squirrel says:

    Poland might be trying to introduce a new Irish kaiju for Del Toro’s Pacific Rim – Wall O’Text.

  13. sanj says:

    Joe – yeah … these media shakeout articles belong in a trade magazine .. DP has said some super smart movie things that only people in the industry would go on about at length.

    > If you can raise revenues while showing a film to fewer >people, that’s a plus, as the potential non-theatrical >market is bigger.

    are we talking about dvd/vod – cause aren’t those supposed to be dead ?

    DP thing about directv …that belongs on a sports blog .
    where thousands of people can debate how much sports games are worth ..

    DP should be cranking out Cannes coverage + new dp/30’s .

    since DP knows more about movies than anybody else – why not quit mcn and take over a movie studio ?

  14. JS Partisan says:

    Yeah Movie, you liking Battleship and Dark Shadows more, once again makes me ask you to let your readership know how you feel about this, and you will get your answer about The Avengers.

    The Avengers is a true, honest to goodness, phenomenon and you and our host’s personal dislike of the film, leads to Joe’s FTW above.

  15. J says:

    >>The most profitable movie of Summer 2008 was Mamma Mia!, not The Dark Knight..

    oh noes it’s rockism v. popism redux

  16. Bob Burns says:

    Good column.

    curious about the cost of awards campaigns…. how many millions will one of the bigs set aside for awards and what is their rationale for the expense? Is the amount spent on awards increasing or the reverse?

  17. movieman says:

    You say tomato, I say cucumber.
    Different strokes, JS.

  18. ryan says:

    David,
    Most profitable movie would still be Dark Knight in 2008. Better ROI for Mamma Mia for sure, but at the end of the day a billion dollar grosser that cost less than 200 million (before P&A) that makes over a billion is still netting you 800 million (understood theaters get their cut, but Mamma Mia has to split that as well). Mamma Mia was 600 million minus 50 million for budget which makes it 550 millin vs. 800 million. Dark Knights surplus just covered Universal’s Battleship loss 4 years later. You need to be more specific when you use terms like “Profitability” because at the end of the day the studio would prefer to spend the extra money if would net them an extra 250 million in profits.

  19. djiggs says:

    I understand tickets sold stat is not the be-all or end-all of a movie’s profitability with DVD/cable/network…however, this is not like in 1992 where a movie like “Diggstown” which did poorly in theaters and can make a profit in home video. Do consumers discover films like “Shawshank Redemption” any more in home video or cable? There are too many competitors now for home video compared to the past. So, wouldn’t the emphasis on squeezing as much as you can from theatrical be more pronounced now? Theatrical is where you have the most white hot exposure for your product compared to the home market where you usually only get publicity for your video launch if you had award success and/or a profitable/memorable theatrical campaign. Also, do studios & production companies clock profitability in the same time span any more? Is it not all about the next quarter’s results or the biggest bank for the buck in the fastest time possible unless you are an awards outlier like “The Artist” or a freak release like “My Big Fat Greek Wedding”? Every ticket sold is a purchase of the product, a consumer validation of I like that film experience. Do you think the investors of Disney are happier about having 61+ million domestic tickets sold total for Avengers compared to 9+ million domestic tickets total for John Carter. Or that 34+ million domestic tickets sold Avengers came after the opening weekend while only about 6 million tickets came after the opening weekend for John Carter? Which one is going have the better after-theatrical profit center?

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