My SXSW Proposal: “Breaking Hollywood Free From Traditional Marketing”

I received great feedback from the SXSW staff on the proposal I submitted (“Breaking Hollywood Free From Traditional Marketing”):

“…Good fit for SXSW (given how many marketing, film and technology people come to the event)… the movie business still has a long way to go in terms of embracing 21st century marketing models.”

Now I need your help. Starting today (August 11th), all panel submissions are open to public vote for 2 weeks to ensure their relevancy.

1. Please take 2 minutes to register if you don’t already have a SXSW account (it’s really 2 minutes and is free)

2. Confirm your registration by clicking on the link in the email you receive

3. Vote for me and my proposal “Breaking Hollywood Free From Traditional Marketing” (the thumbs up will turn green when your vote is recorded)

If you feel like going a step further, you can also leave a comment explaining why you feel my proposal would be a good addition to SXSW 2011.

Thank you so much for your support.

Robert

A note about my website

People who know me know I love to write… everything from blogs to screenplays to novels. Over the years, I’ve sometimes been successful in making time to write regularly. Other times, I’ve lapsed into “quiet periods.”

In addition to current editorial and some social media integration (notably Twitter), this incarnation of the Storyspring website also has some old writing from a blog I once kept called “Worldwide Soapbox” (hence the page name). Over time, I intend to clean up this content a bit for posterity.

My hope is that by combining everything in one place, I’ll be able to more regularly find time to sit with my muse.

THE LATEST GREAT BIG COMPANY RUSE… QUALITY OF SERVICE

On the consumer-facing side of the network delivery world there’s a movement toward offering what’s being referred to as “Quality of Service” (QoS). In case this sounds like another language, swap out “network delivery” for “Broadband service.”

On the surface, the term and corresponding acronym sound pretty good. Something along the lines of “yeah, I think I’d prefer having QoS to not having QoS,” right?!

Wrong.

As a consumer, the most likely place you’ll see QoS is from your broadband provider (DSL from the phone company or Cable Modem from the cable company), and it basically boils down to one thing:

Preferential treatment.

Again, on the surface it sounds like something you’d want, right?! Maybe, but I don’t think it’s really good for you… sort of like Nutrasweet.

This preferential treatment splits into services and content, but pretty much functions the same way. Explained separately:

Services: For argument’s sake, let’s say you have a cable modem and your cable provider offers phone service via your cable modem (known as “Voice over IP” or “VOIP”). QoS comes into play when your cable company puts into place the mechanism to prioritize that phone service on the network.

Still sounds pretty good right?

Ok, but consider this… Change one piece of the equation. You still have your trusty cable modem, but for your VOIP phone, you’ve decided to use a third party company (e.g. Vonage). In a QoS world, you’ve just unwillingly become a second-class citizen to your neighbor who decided to give all the business to the cable company.

Push this out a couple of years and we’re in a world of regional monopolies, not unlike the days of “Ma Bell.” Bet you no longer get your “all you can eat” package for $24.95. Hubbub about QoS and associated network costs would almost definitely become the cable company topic du jour.

Now let’s talk about the other side of the QoS coin:

Content: For about a decade, content companies (from the old guard Hollywood studios to the new world behemoths Yahoo! and Google to start-ups) have been trying to monetize their content on the Internet. The major problem that they’ve faced is that the Internet was born free and established itself in the minds of the public as such. Despite the illegality of stealing music online (MP3’s), this reinforced the idea that what once cost money now doesn’t have to. QoS comes into play when your DSL or Cable Modem provider decides to strike “carriage deals” with content companies. From here, it pretty much plays out the same as above. If yours struck a deal with Google and you are a diehard Yahoo! fan, your neighbor might be getting preferential treatment.

Here’s what I have to say about QoS to the broadband providers:

Stop trying to force fit my Internet into a monetized model that you understand from existing distribution channels. Your job is to figure out a better model (e.g. more speed, more reliability) that works for me because don’t forget, the Internet isn’t yours, it’s mine. You are just the pipe. If you forget that, for even a minute, I’ll do my business elsewhere. I know and understand that you and the content companies need to make money, but it won’t be at my experiential expense.

Seacrest out!!!

(No relation, just always wanted to say that)

WHY DOES CREATIVITY ALWAYS SEEM TO SUFFER?

Lately it seems that in the end creativity seems to always get the short end of the stick.

Disney and Pixar had a much publicized falling out a few months ago (which at least according to the spin of the media was largely Disney driven). Clearly this seems odd on the heels of “Finding Nemo” being the biggest single moneymaker at both the box office and on DVD for the studio.

This week, Reuters reported that Disney and Miramax are currently “negotiating” their relationship (Miramax Chiefs, Disney Debate Control, Money ). This would seem to defy conventional logic. Miramax is a consistent hit generator (and gets regular critical acclaim for their pictures — not a common combination in Hollywood). With Disney in a position to re-up the deal for another 4 years, why do they feel that they are also in the position to renegotiate the deal? Wouldn’t their continued success suggest that Miramax holds pretty much all the cards? Remember “Chicago” at the box office? How about at the Oscars?

But this isn’t meant to be a criticism of Disney…

Also this week, Variety ran a story about the $7 billion videogame industry and the “growing pains” that the bigger companies (EA, VU, THQ) are facing due to escalating production costs (what 3 years ago was ~$1,000,000 can now run as high as $15,000,000) and demands on Wall Street. The result is that the companies are trying to control the creative development shops by buying them up and by producing primarily franchise and sequel based product to “guarantee” audiences.

It’s important to understand that Hollywood and the videogame industry have fairly different businesses despite their surface similarities:

Hollywood has things like second-run, ancillary sales, etc, the videogame industry doesn’t. Talent (most notably actors) is willing/forced to promote the hell out of Hollywood projects because of their contracts and careers.

The videogame industry is still viewed by consumers more as a consumer product company than as a part of the entertainment business, despite increasing demands for entertainment in the actual product.

Of course the insanely high marketing costs are also a factor in all of this too. So what should Hollywood and the videogame industry do? For starters:

Hollywood

In terms of production, who’s to say that a dysfunctional system that makes ~$6 billion annually should change? Well, for starters, I am. It’s bad enough that the industry feeds on itself and turns out so much uninteresting and unwatchable television and movies these days instead of harboring and nurturing writing and directing talent. It seems that the current trend is worse though… where’s the justification in turning on your crown jewel(s)? It seems that some folks in ivory towers need to be reminded that very little good can come from biting the hand that feeds you.

In terms of marketing, stop paying people to come up with silly schemes like plastering movie logos on everything in site that isn’t even loosely related to the movie. Instead, see yesterday’s article The Changing Landscape of Advertising… and Pizza .

The videogame industry

Regarding production, considering how little cache “a list” actors bring to titles historically and above, spend those dollars on good concepts and stories. Harken back to the excitement of the early days of videogames. Who can forget the simple but powerful emotions brought on by the some of the arcade classics like “Space Invaders” and “Donkey Kong.” Or the original “Zork” text adventures… Don’t forget the “Ultima” trilogy. Don’t get me wrong, it’s not like I’m not looking forward to the next “Grand Theft” title, but that’s, sadly, become the exception to the rule.

Regarding marketing, spend more time working the core audiences and less time trying to mass market. For one thing, it’s likely to be as, if not more, effective… for another, it’s a fraction of the cost. There are companies that specialize in things like alternative, street and guerilla marketing. For starters, take $100,000 of that multi-million dollar budget and experiment a little to see what works. There’s only upside, because the money’s already being spent.

THE CHANGING LANDSCAPE OF ADVERTISING… AND PIZZA

About six months ago we ordered a pizza for dinner. When it showed up, instead of the corny “You’ve tried all the rest, now try the best” slogan, it was a bright turquoise box with a huge Snapple advertisement across the front.

My first thought was that this was the brilliant idea of a creative advertising executive. Not only minimal spend for maximum exposure, but a pennies on the dollar spend. Simplified, figure that Snapple negotiated a deal with a pizza box manufacturer to pay for the production and discounted distribution of the boxes (providing incentive to both the manufacturer and the local pizzerias). If the campaign was for 100,000 boxes, it might have cost Snapple a total of $150,000 and represents an inconsequential percentage of Snapple’s annual advertising budget for exposure that probably lasted over a month.

There are of course there are limitations to this genius. While soft drinks certainly go hand-in-hand with pizza in terms of product placement, I seriously doubt if a Volkswagen or Jeep add on a pizza box would incline anyone to consider looking at a new car.

On another note, Columbia Pictures recently struck a deal with Major League Baseball to place “Spiderman 2” logos on the bases during pre-game play. Despite the public outcry that caused MLB to balk at a bigger ($3.6 million) nationwide marketing deal, what was the studio executive who made that decision thinking in the first place? If advertising is about gaining mindshare to drive sales, is there logic in thinking that placement of a movie logo on a base that most spectators can hardly see will drive ticket sales? And how could you even begin to measure the success of the campaign. One might argue that the negative reaction of fans got enough people talking to make it a viral smash hit. The question for the studio is was that the intention of the executive from the start, or was it a stroke of luck?

Hollywood studios often have marketing budgets for their tentpole pictures that approach the production costs. While an automobile advertisement on a pizza box is a ridiculous notion, the marketing of a movie could be a brilliant win-win-win for everyone (and at a whole lot less than $3.6 million).

Here’s how it works:

First, the studio starts strikes a distribution deal with a national chain like Domino’s to produce and distribute the desired number of branded boxes over the desired timeframe (of course the same thing could also be done nationwide or regionally with local pizzerias in the Snapple fashion). Next, they put a code onto the ad (this will be made clear in a minute). Last, they strike a deal with moviefone.com and/or movietickets.com to allow customers to purchase tickets for showings using the code from the ad before they go on sale to the public.

How it’s a win-win-win:

Hollywood Studio

Win #1: Using $1.50 as the per box price (which I’d be willing to guess is VERY conservative), a one million box campaign would carry a cost of $1,500,000, which is still less than half of the proposed MLB campaign above.

Win #2: Instead of select 3 hour windows, the campaign lasts about a month and has repeated placement for people who buy more than one pizza a month.

Win #3: In conjunction with moviefone.com and/or movietickets.com, depending on the nature of the code placed on the box, the success of the campaign can be measured. A single code would be a straight “click-through” measurement (100,000 pre-sold tickets = 10% conversion). Regional or individual box codes allow for potentially quite a bit more data about the individual ticket buyer.

Domino’s (or pizza box manufacturer and local pizzeria)

Win #1: Cash and/or lower cost of operations for duration of campaign.

Win #2: Depending on the nature of the code in the advertisment, the promotion could drive sales in pizza during the campaign.

Win #3: Product tie-in.

moviefone.com and/or movietickets.com

Win #1: Pre-sale of tickets at full price (with full markup).

Win #2: In conjunction with the Hollywood studio, depending on the nature of the code placed on the box, the success of the campaign can be measured. A single code would be a straight “click-through” measurement (100,000 pre-sold tickets = 10% conversion). Regional or individual box codes allow for potentially quite a bit more data about the individual ticket buyer.

We are no doubt continuing to approach a world in which all once free space is sadly occupied with advertisements. Some will be interesting and viable for business, others will be despicable, and sinkholes for both society and corporate bottom lines. For more reading, ABC News’ Buck Wolf posted an editorial this morning on the subject entitled All the World’s an Ad.