Lack of sequels swells ad budgets to $150 mil

On one busy intersection in Los Angeles, eight brightly colored billboards are pushing “Indiana Jones and the Kingdom of the Crystal Skull.”

That kind of hype is overkill even by Hollywood standards, but the signs on La Cienega and Venice Boulevards are evidence of an expensive situation at the studios this summer. The costs to tout their tentpoles is going up.

“They’re certainly not getting cheaper to market,” says one studio maven with a laugh that ended in a sigh.

Studios don’t have the built-in recognition factor to push many of the releases this season. “Indiana Jones” not withstanding, Hollywood is light on sequels vs. last summer, and it costs more to launch new properties that bizzers hope will turn into franchises.

There’s speculation it could cost as much as $150 million to market some of the 2008 summer tentpoles worldwide. While studios are sometimes willing to confirm production budgets, they are loathe to talk about marketing costs.

Among the major studios, the average cost of marketing a domestic release was $35.9 million in 2007. That’s only an average, meaning event pics cost much more. That’s a far cry from 1995, when “Toy Story” was the most advertised film of the year, with a marketing budget of around $35 million.

With 25 potentially “big” movies this summer (up from last year’s 18), and nearly every weekend boasting at least two major releases, studios are working extra hard to break through the clutter.

“You’d better do something good to stand out,” another studio exec says.

Studios have high hopes for “Iron Man,” “Get Smart,” “Hancock,” “Wanted,” “Kung Fu Panda” and the relaunch of “The Incredible Hulk.”

The films with new installments, like “Indiana Jones,” “The Dark Knight,” “The Chronicles of Narnia: Prince Caspian,” “The Mummy: Tomb of the Dragon Emperor” and “X-Files: I Want to Believe,” are backed by campaigns that tout the latest entries as must-sees.

With franchise fever driving increased spending, Warner Bros. and Paramount are also opening high-profile comedies “Get Smart” and “The Love Guru” on the same date, June 20, forcing each studio to shell out more dollars to launch the laffers than if they weren’t competing with tentpoles.

“I would think it’s going to be an expensive summer to market movies,” one veteran marketing exec says.

Studios have more ways to reach auds than they did in the past, as well as being more creative. And they’re not holding back on using them all at once, which is driving up costs.

Those include original content for websites, online and mobile games, blogs — on top of broadcast and cable TV, print, outdoor, radio and dot-com media buys.

“More and more creative platforms are available, and more and more studios are utilizing them,” says Damon Wolf, prexy and CEO of Crew Creative Advertising, which produced the campaign for “Forgetting Sarah Marshall” and is working on this summer’s ads for “The Dark Knight,” “Sex and the City” and “Hellboy 2.”

“You’re dealing with a broad audience,” he says. “There’s something for everyone. All of those things take money to create, produce and release. That all adds to increased marketing budgets.”

Then there are the corporate pressures.

With so many studios now part of congloms, there’s increased focus by shareholders on the bottom line.

Even early buzz that a film may not reach a certain number at the box office on its opening weekend can cause jitters among Wall Street investors, something studios never had to worry about before.

It used to be that some extra billboards or print ads would suffice to keep talent happy. Now stockholders need to be kept just as happy.

“It’s gotten to the point where if people don’t see enough ads out there, they start thinking the movie isn’t good and won’t open,” says another studio marketing topper. “You now have to spend more to make everyone feel comfortable. You have to flood the marketplace with ads even if you don’t need to.”

Signs that summer was going to be costly could already be seen in January, when studios spent $2.7 million per 30-second spot to promote more movies than they have in years during the Super Bowl.

To ease some of the pain, studios have again enlisted the help of Madison Avenue firms, whose client brands will pony up considerable coin — mostly overseas — to tie in with tentpoles.

For example, partners like General Mills, Target, Mattel, Lego, Esurance and Puma are shelling out more than $80 million in promo support for WB’s “Speed Racer.”

Similarly, “Iron Man” has its own shopping list of brands, including Audi and LG Electronics, while “The Dark Knight” has Nokia, Domino’s, General Mills and Microsoft’s Xbox on board. M&Ms, Dr. Pepper, Expedia and Kraft Lunchables will shill for “Indiana Jones.” And naturally, brand-friendly “Sex and the City” isn’t left out, with Mercedes-Benz, Skyy vodka, Coty fragrances and Glaceau Vitaminwater.

Brands with multiple movie pacts include Burger King, which is cooking up promos for “Iron Man,” “The Incredible Hulk” and “Indiana Jones,” while 7-Eleven is also supporting “Iron Man” and “Hulk.”

All have ads planned to roll out weeks before the pics unspool with in-store and in-theater ads and displays, TV, print, radio, direct mail, sweepstakes and online campaigns.

The studio marketing machine may be working overtime to get its messaging across to moviegoers. But is it too much?

In the case of some pics, studios have flooded the web with enough trailers, sneak peaks, exclusive clips and featurettes on the making of the films that bloggers have worried too much footage was being shown, prompting them to cry out, “Enough already!”

Hollywood must now wait and see if all the hype pays off and stakes some tentpoles.

Pam McClintock contributed to this report.

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