Featured Reel

Where Have Movie-Marketing Dollars Gone

by Andrew Hampp 

LOS ANGELES (AdAge.com) -- Especially during the summer, it often feels like there isn't a single piece of media, measured or otherwise, that's not promoting a movie. So it's easy to look at the movie industry's spending figures from first half of 2010 and think, "Where did all the money go?"

Hollywood spent 6.6% less on measured media during the first two quarters of the year, shelling out $1.72 billion vs. last year's $1.84 billion, according to Kantar Media. Among the most notable shifts? A 20% boost in outdoor spending ($58.9 million vs. $48.9 million in 2009), a small increase in national spot radio ($16.4 million vs. $14.6 million) and a slight uptick in digital ($71.4 million vs. $69.9 million).

But most surprising is a series of cuts in TV spending, with network ($697 million vs. $720.3 million), spot ($79.6 million vs. $94.2 million) and even cable ($413.8 million vs. $426.5 million) all posting decreases during the period. Considering studios spend 70% to 75% of their budget on TV for an average wide release, shifting a couple million into other media may seem like chump change.

But moviegoers are a tech-savvy lot, and more than 66% of them do not watch their TV programming live but time-shifted on DVRs, according to the Moviegoers 2010 study from entertainment marketing firm Stradella Road. And with eMarketer projecting DVR penetration to reach 34.8% of U.S. households and 42% of homes to be video-on-demand-enabled in 2010 -- not to mention the rise of streaming-video platforms such as Hulu, Netflix and iTunes -- it's more difficult than ever for movie marketers to be sure their ads are being seen by the time the opening weekend rolls around.

"We've been battling quick-reach media for years. When prime time was the way for us to grab big-reach figures very quickly, it was easy to launch a movie or a product. Now you'd have to buy 600 commercials on cable TV just to reach 50% of your target," said Steve Farella, CEO of independent media agency TargetCast TCM. "Even if you applied that to broadcast prime time, you're still buying 100 to 150 commercials just to reach 50% of your target. You can't do that overnight."

For many studios, that means changing up where their money is spent on TV and making other media work harder.

"You do one of two things: build event status awareness for films by buying television advertising or sponsorships somewhere that has a low [DVR] playback rate, like live sporting events, or create an ad that is unexpected and original enough to break through the clutter on-air and/or be spread virally online," said Erika Schimik, senior VP-media and research for Lionsgate.

Studios have also been experimenting with their TV ads to make them more DVR-proof, whether it's framing them with black bars so that viewers know it's a movie ad, doubling the number of seconds the title is displayed so it's still seen during fast-forwarding, or buying the first and last segments in commercial pods.

One studio marketer, however, suggested that the decrease in TV spending was not due to shifts to other media as much as it was to a decline in overall releases -- an estimated 59 major films were released in the first half of 2010 compared to 67 in 2009, a 12% drop-off. And the increases in radio and outdoor spending were largely due to the time period's higher volume of sequels and franchise films, which have built-in fan bases and are therefore easier to market through quick messaging.

"In the final days leading up the release you still need a lot of TV. You could double your online budget but still be nowhere where TV spending is," the executive said.

Hollywood had a banner year at the box office in 2009, and even as box-office receipts continue to increase on a year-to-date basis due to inflated ticket prices and pricey 3-D releases, attendance was off by 2.5% during the critical summer-movie season through Aug. 14, a sign that consumers are still fickle when it comes to hitting the theater.

by Andrew Hamp
Advertising Age
Reprinted with permission of the author