Is Hollywood Worth Saving?

by Erik Lokkesmoe

In early 2008, more than ninety staff pressed into a conference room for an impromptu company meeting.

At that time, the $160k micro-budget music film Once was completing its $20 million world-wide box office. The $6.5 million quirky drama Juno was making its production costs back in the first fourteen days of its limited release. Facebook had graduated from college dorms to a public platform and would soon overtake MySpace for total unique visitors worldwide. Blockbuster had peaked, and later that year Netflix would reach 10 million subscribers.

“What are we about?” the top executive openly posited. For those expecting an answer, none came. Nor was one prepared. He was genuinely asking – junior assistants to human resources managers, IT to development execs – what this recognizable Hollywood production company was about. With seismic changes rippling throughout the entertainment industry, what was its future?

Had all ninety plus staff been pressured to give an answer to his question, there is little doubt that more than ninety different responses would have been given, and certainly many would likely echo what one marketing executive scoffed:

“We are about making money.”

Four years later, the fog and instability are even more pronounced. Box office receipts stagnate and ticket sales are down. DVD sales are plummeting and Blu-ray sales are maturing. Even television set sales dropped for the first time in history. Twenty-five sequels are planned this year, and hoping higher-priced tickets will save struggling studios, more than forty 3-D movies are planned, almost double from two years ago. Blockbuster is gone. Major stars cannot sell tickets. Meanwhile, the MW3 game grossed $400 million in 24 hours, and online streaming has reached record levels.

It is the most cluttered marketplace in history, but it also the most chaotic and confusing.

One major director and producer has said that within the next two years one of the major studios will be the first to stand up, wave the white flag of surrender, and say, “We’re out.” And others will quickly follow.

No one inside Hollywood can answer the question: what are we about?

Outside of Hollywood, few are sticking around to wait for the response. The audience is driving head-snapping changes – from demanding “anywhere, anytime” viewing to embracing indie films created with Macs and Final Cut Pro by filmmakers who are democratizing Hollywood in places like Lexington and Littleton. It used to be that filmmakers came to town with scripts; now they come with completed features.

Most of the industry is determined to have nothing to do with change. It is a company town driven by self-preservation; innovation and risk live five hours to the north in Silicon Valley. You quickly learn that you are only as good as your last movie. You conform, play it safe, or risk marginalization.

This 100-year-old Hollywood system remains in place not because it works but because no one dares propose anything different. Consider how many executives have worked their way up to the corner suite only to find that everything they learned is no longer a viable solution: critics and television ads are losing influence, stars aren’t selling tickets, and your target audience is now splintered across ten thousand blogs. The execs just want to hang on for a few more years, and then sneak out the back door before making too many mistakes.

Change will not find its name at the velvet rope guest list; it crashes the party like any outsider would: out-of-the-blue and awkwardly brash through the backdoor.

Many have said that the best storytellers are found in the golden hills of the San Francisco Peninsula. That may be true right now, but the past and the potential belong to those along the golden sands of Los Angeles. In some areas it is flourishing. Technical wizardry in special effects and more-real-than-life-itself animation are at the very edge of innovation – coming out of places like Pixar and WETA – and yet, so much of the industry looks shockingly familiar to 1992. Same techniques. Same rules. Same outcomes.

It’s quite sad, really. American film is one of the greatest cultural achievements in world history, and when done well, is rightly heralded for its marvels and its magic. Everyone has a list of movies that defined a moment, moved them to tears or to cheer, and created a social bond with strangers in a time when we share little in common with our co-workers or neighbors.

Hollywood is worth saving. That’s why I believe that this fundamental question, “what are we about?” must be answered – soon and seriously – by someone. Or some studio. Or some outsider.

I’ll gladly stick around for that answer, but in the meantime I’d like to give a few recommendations not only on what Hollywood should be about, but also how to get audiences back.

Now, you may be asking who am I to advance any recommendations? I am not a filmmaker. I don’t own a theater. I’ve never invested in a movie. I distribute and market them – and often not in the traditional sense. We specialize in the eventizing of content and the mobilization of audiences – getting disinterested and distracted consumers to do one thing at the exact right moment: buy a ticket. It’s about personalization and participation, ownership and aspiration. Our company sits in the unique position between the industry and the audience; we have a deep affinity and affection for both. We stand in the widening chasm between the two – an industry and an audience who are deeply unaware (at best) and dismissive (at worst) of one another.

We know the tensions marketing and publicity teams feel between their love for a well-executed campaign that turns a small gem into Oscar-gripping gold and the assembly-line pace that they must keep and deliver for pressuring producers. Likewise, we know the tensions audiences feel between a desire to support beautiful and well-acted stories and the clutter of content that makes it difficult to know what is good and what is not. Often the most crass and crazed movies succeed.

My company banks its entire existence on this assumption: the future belongs to the unconventional and the alternative, the nimble and the custom, the audience-minder and the brand-builder.

Success will be defined by the ones closest to the consumers when the looming collapse happens in Hollywood – those who have a meaningful brand, those who have built a pipeline, those who have agility and finesse, those who have acquired and aggregated data, those who monetize “eyeballs” not “butts.”

Recently a slew of articles have offered suggestions on how to “fix” Hollywood, many which are obvious and over-simplistic: make better movies, lower ticket prices, etc. For the past four years I’ve seen that it is not this easy – there are, however, several strategic ways for Hollywood to begin a resurgence. This list is by no means exhaustive. My hope is that it will force new and different solutions to the surface.

1.    Kill the middle-class movie. Other industries are going big and small, no middle. In publishing, it’s big names and self-published authors. In music, it’s arena shows and indie artists. In movies, it should be mega-budget, tent-pole, must-see-on-the-big-screen experience and small-budget, specialty-audience, story-driven films. The middle increasingly means mediocrity, not to mention impossible to make your money back. The financials only “worked” when DVDs were selling. Make it big, make it small, or don’t make it at all.

2.    Avoid obvious mistakes and missed opportunities by keeping an eye on distribution and marketing on day one. We have read countless scripts that could have avoided box office disaster if a few lines or scenes were changed during production – edits that would not have infringed upon the creative vision of the writer or director. Or how a film could have invited ten major influencers to be extras in a scene or how a major organization could have mobilized its membership had it been mentioned in a scene. The marketing and distribution teams know the audience. It only makes sense to have them advising productions on day one.

3.    Allow smart phones to remain on during a show. The glow of iPhones has replaced the flicker of lighters at concerts. Sports encourage check-ins and texting. Theaters should do the same. Not only would it encourage audiences to share, comment, post, and tweet in real-time (which is the whole idea), it would also allow filmmakers to experiment with gaming and interactive experiences where audiences “break the fourth wall.” We have scripts where the movie invites audience participation through Foursquare and Facebook during the show, creating unique, in-theater, interactive experiences. Smartphones are already on; its time to make it permissible. Allow the distributor to decide whether phones are allowed or not.

4.    Keep moving toward “coming to a screen near you” releases. Think screens not windows. In a perfect world a movie would be available on every device, every screen at the same time. Mobile. VOD. iTunes. Netflix. Theaters. DVD. Semi-theatrical screening events. It’s what the consumer wants, and it is a more efficient way of spending marketing dollars. It’s absurd that studios spend millions on marketing a theatrical release only to restart the home entertainment campaign three months later. In a crowded and noisy marketplace, a single release date makes sense.

5.    Build a brand. During a meeting with a major studio executive, our team recommended a name acquisition strategy around their releases – we believe data collection is vital for predictive analytics, audience mapping, and brand loyalty. His response? “Data? Why do I want data?” In the assembly-line operation that most studios operate, each movie campaign is treated separately instead of building upon any previous or similar releases. This is standard practice and why most have no brand distinctiveness. They believe there is no reason for an audience to be a fan of the studio. Its audiences are as vast and varied as the genres and ratings of the movies they release.

Some, however, rely upon brand integrity and loyalty – think of Disney and Pixar, Fox Searchlight and Participant, even Tyler Perry. Fox Searchlight, last I checked, had one of the most followed Twitter accounts. Fans anticipate their next release because they know they are getting a particular kind of specialty movie. Audiences are looking for trusted brands that help them make good decisions. Disney, Apple, JetBlue, Polo all mean something to the consumer. Stop just releasing films and start creating brands.

6.    Make it personal. Television and radio, magazines and billboards are effective for mass awareness campaigns. Awareness, however, is not leading to attendance. Successful movie campaigns in the future will have “flipped” exit surveys – showing that audiences bought a ticket because of peer-to-peer recommendations, a trusted leader, an affinity organization, a participatory activity or event, or other unconventional means, instead of traditional advertising. Marketing is going hyper-local, which means advertising is increasingly losing its power of persuasion. Yes, it makes the movie feel real and credible. Nevertheless, we have seen first-hand the power of an individual who takes “ownership” of a movie, and how they single-handedly can mobilize thousands to show up on opening weekend. Studios should spend at least 5% of the P&A (prints and advertising) budget on unconventional strategies.

7.    Create aspirational, not inspirational, stories. “Inspirational” is a 1990s word that, more often than not, means saccharine and sanguine story-telling. Even Hallmark and Wal-Mart can’t make it work. Audiences increasingly want content that invites them to aspire to something bigger than themselves. Doesn’t mean you should make it medicinal – i.e., “see this movie because it’s good for you.” Instead, authentically connect the story to the gritty, messy, and often-unfixable world that we know.

8.    Give up your ego, filmmakers. Ten years ago, musicians wanted the big label deal; it was a sign you made it, a bragging right to family and friends. Today, most artists wouldn’t think of giving up their rights to a Warner Brothers Music or Sony/Columbia. They’d rather go it alone. This needs to happen with filmmakers. It’s about the audience, not the presentation credit. Make a film for an audience, not an acquisitions executive. Studio acquisitions are few and far between. There is an audience for your film, but start finding alternative ways to reach them. Leverage the industry, don’t look for permission or affirmation from its gatekeepers.

9.    Ditch the BMW for a month, tour the Heartland. Executives should look to spend one month a year on the road in places other than New York and LA (preferably in an old Winnebago.) Visiting movie theaters in Greenville, South Carolina and Fresno, California (two places that consistently do big opening weekend box offices for family movies). Eat at roadside diners. Read highway billboards. Drive down main streets. Get a cut at the local barbershop. It would do a lot of good to show why audiences are tuning out and moving on. Why not open movies outside of LA and NY? Why not have red carpet premiere in unexpected places like a school, a church, or even someone’s house? What about full-color ads in the Indianapolis Star not just the LA Times? The heartland audience is changing, and Hollywood would do well to serve this audience with quality content that fits its way of life.

The answer to what Hollywood should be about is quite simple: the audience. The audience has been an after-thought or seen only in transactional instead of relational terms. The long-term viability of the industry hinges on whether or not the audience becomes the primary driver of decisions made at every-level. That means a fundamental transformation of how the industry does business – from development to marketing, distribution to budgeting. Yes, this is show business – making money is primary, and there’s nothing wrong with it. Realize, however, that the money will begin to flow again when Hollywood realigns itself with its great tradition of making content that serves the tastes and trends of its most important customer: you.

Do you think Hollywood is worth saving?
As part of the audience, what can you do to support the revitalization of the movie industry?

Editor's Note: This image was found here.

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