Hollywood is Doomed
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Hollywood is Doomed

summer-2013

Hollywood has had perhaps the worst summers ever so far. Almost all the major blockbusters this year, with all their special effects, big stars and ridiculous amounts of advertising, have bombed. This had been predicted by Steven Spielberg just months before, in which he told an audience, “there’s going to be an implosion where three or four or maybe even a half-dozen mega-budget movies are going to go crashing into the ground, and that’s going to change the paradigm.” Still, Hollywood spends ridiculous amounts of money for advertising in TV, Print and even online – but has spent almost nothing in performance and affiliate marketing. That is going to doom them, faster than they think.

In fact, the numbers for Hollywood spend in performance marketing might be absolutely none. I couldn’t find any numbers and the few experts that I queried, said they couldn’t even think of an example of a performance marketing budget for a Hollywood film. It seems that the studios have drunk the cool-aid that brand-only marketing is the only way to market a film, and have completely ignored the possibilities of performance marketing. Strange that they are doing this while loosing more and more on average per film.

As I made clear above, if Hollywood does not embrace performance marketing as a method of advertising, they are going to doom themselves. However, if they decide to wise up, it might actually save Hollywood. Here are a few reason they need to get into performance marketing ASAP.

1)    Performance marketing can engage consumers. Online is becoming a lot more than a banner or pre-roll video, but that is still where most of the Hollywood spends it. Imagine creating online games about the movie, where you pay affiliates based on how many times a consumer plays the game? You’d be bringing consumers into a world where they would learn more about a movie before seeing it, and also setting them up for buying products based on the movie.

2)   Performance Marketing can predict future ticket sales. How about paying affiliates to get information at the end of a trailer from possible movie-goers about a films future success? You could actually find consumer interest based on pre-made trailers of a movie that isn’t even in production – and find out if its going to waste its $250M budget. I could have told you that no one really was interested in seeing the Lone Ranger.

3)   Performance Marketing can save a doomed movie. Studios could offer downloads of movies online to consumers directly, and pay affiliates a cost per download. Instead of going to a movie theater, imagine paying $20 to download a movie the same day of the release. The technology is there to prevent copying, and being able to promote a new movie over Facebook and social media would be eaten up by affiliates. Direct to DVD/Netflix is where a lot of movies are going anyway, so why not embrace the model as a way to perhaps release new films.

The current method of promoting movies isn’t working. Studios are clueless what people really want, and by refusing to embrace affiliate and performance marketing, they are going to find themselves in serious trouble.

Written by Pace Lattin

Pace Lattin is one of the top experts in interactive advertising, affiliate marketing. Pace Lattin is known for his dedication to ethics in marketing, and focus on compliance and fraud in the industry, and has written numerous articles for publications from MediaPost, ClickZ, ADOTAS and his own blogs.

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14 Comments

  • Hollywood and other movie makers must realize that people want to watch movies in a totally different way now. Going to the theaters or buying a DVD is getting old. They need to change their business model and adjust according to what consumers want.
    Johan Bengtsson recently posted..Beef with chili, onion, garlic and Bearnaise sauceMy Profile

  • social media says:

    well they could find this in the “easy way” ( using performance marketing) or in the “hard way” as they did so far …it’s up to them
    social media recently posted..[Infographic] What Teens Share on Social MediaMy Profile

  • Louida says:

    I have to agree! I hate going to the movie theaters to watch movies since it is not as convenient for me with children. I would be much better being able to watch new movies at home.
    Louida recently posted..E-Poll Surveys is Looking For New MembersMy Profile

  • Mike Hill says:

    I spoke with a movie producer last year and was shocked by the complete and total lack of understanding of true monetization. Things that would seem elementary for URI, were completely foreign to them. Eventually the conversation broke down because I realized they had no way of executing it were simply going to be looking to us to execute everything and deal with the politics and egos involved. So when you think about Hollywood or large corporations, and you think possibly these people know more than you, think again. You are supreme ruler of your own destiny and world.
    Mike Hill recently posted..Facebook Timeline for PagesMy Profile

  • Brad W. says:

    I used to love it, but now, I absolutely hate going to the movies. Who wants to spend a few hours in a room with a bunch of irritating morons on their phones, teens doing stupid stuff trying to impress their friends, loud babies, sticky floors, a dumbass behind you kicking your seat, crazy expensive ticket and concession costs… the list goes on.

    Why not offer an “On-Demand” option for those who want to watch a new movie in the comfort of their own home? Offer the movie for $20 and you could have 5 of your friends over at your house, saving everybody money while actually enjoying the movie experience.

    Hollywood simply can’t get over their ego. It’s not glamorous to offer a brand new movie on a TV. They want everyone to go to the theatre and get the full cinematic effect. DUMB!

    Imagine affiliates getting paid $7 for a $20 movie download. The movie industry would be BOOMING once again! Too bad that will never happen, though, thanks to the egos of Hollywood.

  • Ryan Isabella says:

    No doubt Hollywood is doomed – just like the earth?. Zombie apocalypse anyone? You know you love zombies you freak.

    Its like Hollywood regressed into ‘end of the world’ mode over and over and over. There should be new usages of speech for going to the big screen for an evening out like “wanna go see the world end again?.” I have been actually using that.

    Anyway, Sharknado and The Room should be the new standard for make-shift movie greatness. I want so see something made from nothing, from some dude in a parking lot! Really, after wasting $40 and my time, I dislike that feeling of excitement and anticipating of the movie ending, staring Nicolas Cage – while in a hot, crowded theater. You leave feeling like you got scammed.

    Hollywood needs to give us a reason to go back…

  • Miko Matis says:

    They’ll recover! Most of the big budget movies bombed but there are wins. Look at The Conjuring. Made with really small budget but its on top of the box office.
    Miko Matis recently posted..How to kill bedbugs?My Profile

  • mo says:

    all sounds very good but itunes will take it all!

  • Gajendran M says:

    Now a days Hollywood rules cinema world, i think Hollywood looking for develop with new ideas…..

  • Well I think Hollywood is doing its best to keep up with the times. It’s not like it has another choice anyway.
    Christopher James recently posted..The top 3 get reviewsMy Profile

  • Jason Murphy says:

    I understand the premise of this post is to reflect that Hollywood isn’t working with what we commonly associate performance marketing with: the work at home affiliate and the small-to-medium sized enterprises (SME) such as networks.

    However, I need to be a little bit of the devil’s advocate here and mention that Hollywood has long been involved in performance marketing well before the term “performance marketing” was coined by our industry.

    Hollywood has affiliate relations with almost every theater in the country. They split revenues, a large chunk even, with theater owners and chains.

    Also on the end-user side of performance marketing, sites like Flixter and Fandango have programs where individuals and businesses can earn from individual ticket sales. Major studios and theater chains are vested directly in those sites and similar ones.

    So to say that Hollywood isn’t involved in performance at all and that’s a main reason to blame for their fallout is quite an ignorant statement.

    The paradigm shift in entertainment isn’t Hollywood seeking added marketing reach from affiliate marketers. It has been and will continue to be the creation of value for the consumer. Right now, that’s where they are bleeding the most: in perceived value.

    That strategy along with encouraging their theater owner partners to continue creating an ultimate theater experience (the dine-in theater experience trend is a great example of this… though they totally missed the mark on pricing).

    If Hollywood wants more butts in seats, their theater partners need to start delivering Wal-mart like prices for the masses for the entire movie experience. Especially in a down economy. We all want an experience. But we don’t want to be nickel-and-dimed for it.

    I spent $35 on a pair of matinee (MATINEE!) Imax tickets for my son and I. Last thing I was going to do is spend another $20 (I’m not exaggerating on the price here) for a large drink and popcorn combo. I’m finding that with prices like these, I can entertain my family for hours at a professional sporting game or a whole day at an amusement park. It’s all about the consumer voting with their dollars, and right now consumers are demanding value.

  • imran says:

    Hollywood and other movie makers must realize that people want to watch movies in a totally different way now. Going to the theaters or buying a DVD is getting old.Well I think Hollywood is doing its best to keep up with the times. It’s not like it has another choice anyway.

  • Hollywood and other movie makers should realize that people want to see movies in totally an other way now. People dislike traditional ways like going to theater or DVD. They should adapt new ways.

  • standh says:

    Tell me again how there is tech to prohibit copying, anything that streams on your pc (sound+video) can be recorded (this is coming from a programmers perspective)

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