Studios seek to cut corners on P&A costs
LAS VEGAS — With a brutally competitive summer movie season looming — New Line marketing prexy Russell Schwartz described the crowded lineup as a “bloodbath” — studio execs said they are trying to reign in promo spending and drop media they deem ineffective.
Part industry convention and part publicity event, ShoWest is arguably the one time when studios lift the hood and shed the most light on their sophisticated marketing engines.
But a day after a Motion Picture Assn. of America study showed that studio marketing spending fell 12% to $34.4 million per film in 2004, marketing execs were still trying to make sense of the figures.
Asked about the fluctuations, one marketing topper shrugged. “I don’t know how they get those numbers,” he said.
While pulling back and focusing ad spends was a consistent theme on Wednesday’s agenda, the sked also featured the annual Shmooze-a-Rama, where studios try to top each other with elaborate film promotions. MGM erected a replica of “The Amityville Horror” house, while 20th Century Fox flew in “Fantastic Four” stars Jessica Alba and Ioan Gruffudd to gamely pose for photos with a long line of convention attendees.
As Fox prepares a huge campaign for “Four,” domestic marketing prexy Pam Levin said, “Those costs can’t keep escalating.”
Following a studio trend, Fox has increasingly relied on marketing partners to supplement their own spends for their tentpoles. For “Robots,” the studio secured $100 million from brands like Kellogg’s, Burger King and the U.S. Postal Service and struck a deal with AOL to mail 1.55 million “Robots”-themed CD-ROMs. An even larger partnership push is planned for “Fantastic Four.”
But on a panel of top mavens at the Marketing Summit, a confab-within-a-confab introduced this year at ShoWest, execs said such partnerships are not leading to decreased studio spending.
“I don’t say, ‘They’re going to spend $8 million, so I’ll reduce my media by $8 million,” said Dawn Taubin, marketing prexy at Warner Bros. When the studio devises a marketing plan on a picture, “This is our budget and this is what we’re going to spend regardless,” she explained.
“It’s something you take into account,” Levine said of ad buys by partners like fast-food chains, but “it’s not the same as when you can tell your own story.”
According to a report by media tracking firm Nielsen Monitor-Plus, the film with the highest media marketing costs last year was Warners’ “The Polar Express,” with $46.2 million. Pic also had numerous outside partners.
The film industry’s spending spent on U.S. media last year was $3.4 billion — more than a third of the box office gross of $9.5 billion.
Top spenders, according to the firm, were Buena Vista with $499.5 million and Warners ($498.7 million).
Given the huge amounts of money at stake, marketing heads said they are constantly looking for outlets to cut.
“I just drew the line the other day with (signs on) the barricades of parking garages,” Schwartz joked during the panel discussion. More seriously, he noted New Line doesn’t buy television ads to air before Thursday for its films in release.
TV still king
And while television remains the largest single marketing expense for studios, Taubin said she’s paring back nontraditional media. “I don’t buy a lot of valet tickets, hotel keys” or the separator bars used at grocery store checkout aisles, she said. “We’re trying to curb what I call vanity spending, that is, the spending that doesn’t do anything but make you feel better.”
And while all studios are cutting back on their newspaper ads, she said, Los Angeles and Gotham papers still receive big movie biz because filmmakers read them and will push for a full-color double truck ad if they see one for another film.
The dynamic, she said, also is pushing costs up in the production of trailers. Rather than hire one house to cut one trailer, Taubin said, “Filmmakers come in and they want to see three cuts. We’re frequently going in with multiple cuts from the same vendor or multiple cuts from multiple vendors.”
(Jonathan Bing contributed to this report.)