SPONSORED

Hollywood’s Soaring Marketing Cost Dilemma

As marketing costs soar for domestic theatrical releases and summer box office revenues decline, distributors of independent movies are struggling to find answers to the dilemma of supporting distribution with sufficient advertising budgets to release films, while managing the return to producers and P&A investors.

An advertising budget for an independent wide release to support an opening weekend can start in the $20 million range, and for a studio tentpole release, P&A can reach in excess of $150 million. Rising advertising costs compounded by the ever-increasing fragmentation of advertising consumed by the moviegoing audience is creating significant investment challenges. What was once a vibrant P&A investment space now sees traditional P&A funds limiting their exposure and demanding higher returns in response to the volatile landscape.

Recently, a new P&A investment platform has emerged that blends an advertising agency media placement model with a risk-tolerant investment model to provide funding for the advertising side of the P&A budget while mitigating capital risk and significantly increasing investor returns.

Media Funding Partners, the Los Angeles-based media placement and investment firm, announced this new approach in panel discussions at both the Winston Baker Film Finance Forum and the 2017 Variety Massive Entertainment Marketing Summit. The company has provided funding and media placement for three wide release films and two smaller releases in the last 18 months.

As a media brokerage and buying agency specializing in independent theatrical releases, the firm provides media placement services for TV, radio, print, outdoor, and web advertising as well as providing funding for those placements. The company is able to tie their investment return to the success of the film while taking a subordinate role in the recoupment waterfall, lowering the risk and providing a significantly better return for the other P&A investors of the film.

More information on Media Funding Partners, including access to a February 2017 case study of a 2000 screen release showing over delivery of planned impressions at a lower cost per point than the media plan called, for is available at MediaFundingPartners.com

More Biz

  • Bruno Mars Grammys

    Recording Academy Announces Date, Deadlines for 2019 Grammy Awards

    As marketing costs soar for domestic theatrical releases and summer box office revenues decline, distributors of independent movies are struggling to find answers to the dilemma of supporting distribution with sufficient advertising budgets to release films, while managing the return to producers and P&A investors. An advertising budget for an independent wide release to support […]

  • The Matcha Bros

    Ansel Elgort, Diplo, Billie Eilish, and Von Miller Invest in MatchaBar Energy Drink

    As marketing costs soar for domestic theatrical releases and summer box office revenues decline, distributors of independent movies are struggling to find answers to the dilemma of supporting distribution with sufficient advertising budgets to release films, while managing the return to producers and P&A investors. An advertising budget for an independent wide release to support […]

  • Ron Burkle

    Ron Burkle Sues Lantern Capital Over Weinstein Co. Costs

    As marketing costs soar for domestic theatrical releases and summer box office revenues decline, distributors of independent movies are struggling to find answers to the dilemma of supporting distribution with sufficient advertising budgets to release films, while managing the return to producers and P&A investors. An advertising budget for an independent wide release to support […]

  • Netflix Reed Hastings

    Netflix Falls Short of Q2 Subscriber Expectations Worldwide, Stock Dives

    As marketing costs soar for domestic theatrical releases and summer box office revenues decline, distributors of independent movies are struggling to find answers to the dilemma of supporting distribution with sufficient advertising budgets to release films, while managing the return to producers and P&A investors. An advertising budget for an independent wide release to support […]

  • Johnny Depp

    Johnny Depp Settles Feud With Former Managers

    As marketing costs soar for domestic theatrical releases and summer box office revenues decline, distributors of independent movies are struggling to find answers to the dilemma of supporting distribution with sufficient advertising budgets to release films, while managing the return to producers and P&A investors. An advertising budget for an independent wide release to support […]

  • Ed Sheeran Shape of You

    Ed Sheeran Tops Pollstar’s Mid-Year Touring Charts as Industry Soars to Record Gross

    As marketing costs soar for domestic theatrical releases and summer box office revenues decline, distributors of independent movies are struggling to find answers to the dilemma of supporting distribution with sufficient advertising budgets to release films, while managing the return to producers and P&A investors. An advertising budget for an independent wide release to support […]

  • Lantern Capitol

    Weinstein Co. Closes $289 Million Sale to Lantern Capital

    As marketing costs soar for domestic theatrical releases and summer box office revenues decline, distributors of independent movies are struggling to find answers to the dilemma of supporting distribution with sufficient advertising budgets to release films, while managing the return to producers and P&A investors. An advertising budget for an independent wide release to support […]

More From Our Brands

Access exclusive content