The recession has forced marketers on Madison Avenue to slash advertising budgets in order to cut costs, but they’re not alone. Penny pinching has invaded the offices of Hollywood’s marketing mavens.
Budgets to promote studio slates have taken a hit, forcing them to get a little more creative in how they push those pics — especially this summer, the first for studios since the global economic crisis enused.
Still, studios aren’t holding back. They’re firing on all cylinders to get the word out about their new movies. But doing more with less has become the mantra.
It’s a daunting task at a time when studios are trying to launch big-budget franchises, like “G.I. Joe” and “X-Men Origins: Wolverine,” and reboots, like “Star Trek” and “Terminator.” It also takes plenty of marketing muscle to keep marquee brands like “Harry Potter,” “Transformers,” “Night at the Museum,” “Ice Age” and “Da Vinci Code” follow-up, “Angels and Demons,” going strong.
Paramount has a lot riding on “Star Trek.” The future of that franchise depends on the success of the film here and abroad, so it spent heavily to hype it to new audiences.
The biggest factor driving the rising cost of marketing campaigns is that it’s just more difficult to reach moviegoers these days. A trailer in a theater or on TV isn’t viewed by as many people as it used to be. And that’s not just in the U.S., but also the overseas market, which generated 65% of box office receipts in 2008.
It’s hard to take the measure of spending trends this year, because studios like talking about marketing budgets about as much as they like talking about the amount they spend making movies. They just don’t.
Budgets that are publicly announced are never fully believed. Bean counters find too many creative ways to fudge the final figures.
While some believe a tentpole requires $100 million in marketing support, the numbers are so fuzzy that the Motion Picture Assn. of America even stopped reporting marketing budgets in its annual state-of-the-movie biz report at ShoWest this year.
MPAA chairman and CEO Dan Glickman called the average cost comparisions that it compiled each year “useless” and “misleading.
“I’m not sure what these numbers mean anymore,” he said at ShoWest in late March, referring to the complex nature of film financing and distribution.
What the numbers mean, however, is that opening a pic is more expensive than ever. Yet there are deals to be had for cost-conscious marketers.
Prices for ads on TV, in print, on billboards and on the Internet are dropping, giving studios more bang for their buck in marketing blitzes.
“Campaigns seem to be just as big, they’re just more efficient,” says one Sony marketing executive. “We’ve had to become innovative in how we market films.”
n Networks are bending over backwards to get more movie money at a time when traditional advertisers like carmakers are buying fewer ads, creating an opportunity for studios to renegotiate lower ad rates for themselves and hit auds hard across broadcast and cable.
NBC gave studios deals on the $3 million per 30-second-spot rate for the Super Bowl, during which nearly every studio had a spot for the first time in years. This year’s Oscarcast was opened to movie ads for the first time, at a reduced rate.
Networks are also coming up with more creative opportunities that didn’t exist before to attract the studios.
For example, networks are plastering the bottom third of their TV screens with movie ads; ABC enabled Paramount this month to fly the Enterprise through the “O” in “Lost’s” logo, as a part of a stunt to promote “Star Trek,” directed by J.J. Abrams, whose shingle produces the TV show; network also had characters of Disney and Pixar’s “Up” bounding down “Desperate Housewives’ ” Wisteria Lane to promote the toon.
“We’re definitely getting a better deal on TV right now than we used to,” says one top marketing exec at a studio. “We’re being offered stuff we didn’t get before. We’re benefiting from the economy that way.”
That includes overseas.
“International is the growth part of our business and the recession is worldwide,” says one studio marketing exec. “The same television deals are translating overseas. As international is growing, we’re spending more money but we’re spending it more efficiently because of the deals we’re getting.”
n Studios are embracing more economical options on the Internet, as online ad rates plummet, offering up more chances for tentpoles to take over sites on Yahoo and homepages on MySpace and blogs, as well as to create channels on YouTube and launch games or other apps for Apple’s iPhone and even Twitter.
“Up” director Pete Docter, co-director Bob Peterson and Disney animation topper John Lasseter tweeted their experiences of opening the pic at the Cannes Film Festival. The debut there was an opportunity for Disney to not only make history — with the first animated pic to open the fest — but also use the event to promo the film through media coverage and other publicity.
“What’s great about online is that it doesn’t cost a lot of money,” says one studio marketing exec. “There’s so much that we can do that doesn’t cost money. Twitter is free.”
n Stunts still go a long way to produce valuable PR.
Although premieres are being scaled back, with fewer afterparties than before, interviews and photos taken on the red carpet are still considered key to appear on shows like “Entertainment Tonight” and “Access Hollywood” or celebrity mags.
“We just want to get that red carpet exposure,” says one exec.
Sony premiered “Angels and Demons” in Rome, just steps away from the Vatican, as Catholic orgs lambasted the pic’s portrayal of the church. Meanwhile, Fox held the official preem for “Wolverine” in Tempe, Ariz., using a contest to up interest in the opening; its “Night at the Museum: Battle of the Smithsonian” took advantage of the natural tie-in and held its preem at its namesake institution. Again, studio’s trip to the museum was seen as a publicity stunt that should pay off in free media exposure.
“Hollywood premieres just don’t generate any excitement anymore,” says one studio rep.
Studios have gotten used to the road trips.
They’ve marked July on the calendar as the month they make the trek to San Diego to promote their tentpoles to fanboys at Comic-Con, often a year before the movies roll out. Last year’s show gave attendees the first looks at “Wolverine” and “Terminator Salvation,” getting auds in a lather and running to their blogs to talk up the pics’ potential.
n Promotional partners have proved more valuable, considering tie-ins can result in tens of millions of dollars spent on TV, print, online and other ads that can offset a studio’s costs.
In return for the additional marketing muscle, studios are becoming more willing to offer up exclusive content than they did in the past.
This summer, Fox landed McDonald’s to create Happy Meals and launch TV spots and other efforts around “Night at the Museum” and “Ice Age: Dawn of the Dinosaurs,” for which the studio is providing the burger giant exclusive animation and visual effects sequences.
Meanwhile, Michael Bay is directing a spot for Burger King’s efforts around “Transformers: Revenge of the Fallen,” while d.p. Dan Mindel lensed a spot for the chain’s “Star Trek” spots. The fast food chain is also promoting “G.I. Joe,” giving it three back-to-back tie-ins with Par’s summer pics.
Separately, Universal allowed Subway to launch the first trailer for “Land of the Lost” online; the sandwich chain has a major promo planned around the pic at its stores and on TV. Pizza Hut also was given exclusive footage of “Terminator Salvation” to promote on its website.
The activity shows that despite cutting back on overall campaigns, brands still find tapping into entertainment too valuable to pass up.
“The ones not compelled by film have taken themselves out of the game or been forced to get out of the game, like the car category,” says a top Universal promotions exec. “We’re left with the brands who get it, love it, and have dollars to spend.”
And that’s good news for Hollywood. As studios are forced to advertise more to tubthump pics, they benefitting from the recession by getting more for their money. The bad news is that once the economy eventually rebounds, prices will only increase.
“It’s inevitable,” says one exec. “That’s when negotiating deals will really become key.”
Put another way, that’s when studios will really have to start counting their