Hollywood’s Marketing Headache

August 7, 2014 in Daily Bulletin

Hollywood is struggling, writes Pamela McClintock. They have to spend more money than ever before to convince people to go watch their films.

  • The latest Transformers film has become China’s all-time top grossing film, making over $300 million.
  • It only cost about $5 million to market the film in China – incredible returns when compared to the $100 million spent on advertising in North America.
  • Marketing costs for films have shot through the roof; in 2007 the original Transformers spent $150 million on ads. Now ad campaigns are around the $200 million mark – a 33% increase.
  • And marketing campaigns in general are becoming less effective. They rely heavily on television but there’s no one single show that commands a wide audience. So movies have to be advertised on multiple timeslots and networks.
  • Yet television spots aren’t getting any cheaper. They can go for as much as $700,000.
  • Executives seem to underappreciate the power of social media. They only spend about $1 million marketing on it, but it plays an outsized influence on people’s movie preferences.

Read more about how the Chinese government helps keep marketing costs down abroad, why movie revenues are trending down, and more over here.

Source: The Hollywood Reporter