Liesl Copland: “Dear theater owners, fear not - you are not going anywhere”

In the not so distant future where every piece of content ever transferred to video is available on our remote controls, specialty film has a unique advantage, and Documentary is a large and vital part of that sector. All of that is to say, for the sake of us banding together with a bit of information at the ready, hopefully you’ll forgive me a little bit of analysis.

So - content monetization - where will the revenue come from? I hope it is easy to understand why an agency who represents hundreds of content creators would be thinking about this, especially in the present economy. Everybody in the industry is thinking about it. Our business requires that we think of the consumer at the end of the day and the consumer and consumer habits have dramatically changed.  What’s worse, we are confusing them a bit. How have they changed, let’s watch.

View the video here.

So, what is very obvious from this video, which can be found on YouTube and was created by the fine people at a website called Socialnomics.net, is that the one thing that is changing faster than anything at the moment is the rate of change itself…  Adoption rates of new technologies are happening more quickly, we have unprecedented access to information and content, and each other, and the most connected generation moves on to the next new thing faster than the rate of film production.  This does make life complicated, but it gives us (and by us, I mean the filmmakers in this room) real opportunities, because not only are we all out there marketing to each other, what was previously a top down supply chain in our business has become a vibrant two-way ecosystem.  Internet companies have benefited from this tremendously, but the film business, and especially the specialty film business has been left behind. 

Key note recap: Jim Stern said we need some new muscles and I think the first thing to do is to bulk up on is a little bit of data gathering, then we need to flex our pattern recognition skills.  And then maybe, collectively, we can come together to devise a uniform distribution model that serves both our ability to continue to make specialty films and docs, and our ability to reach and retain our audience.

First, we as doc filmmakers and doc lovers need to read like never before - and not just the film trades and the MPAA yearly report. We need to look also at the news sources where the innovation is happening: Tech Crunch, and Ad Age. Information is power. Every crime thriller and cop show has that scene where investigators put pictures and pieces of a puzzle up on a bulletin board. Eventually the epiphany comes - the bolt of lightning… and then our hero runs out of the room. 

Go to Staples and get a bulletin board. Because the power is truly yours. Get one thing straight - You are the new “they.”

The Power Shift

I shouldn’t have to tell anyone that traditionally all goods, including movies, have been purveyed to the world at large by a certain power structure that filters the content through a certain supply chain. The few - the people with money - pay for the works of intellectual property to be produced and then marketing happens and then down at the retail level, after consumers receive successful marketing messages, there is a point of purchase. The only talk back session ever to touch the supply chain logic in the movie industry was something called the focus group. 

But now, much of the activity is happening in a new layer that the Internet has provided. And what is more exciting to me is that in the same place where we are reading and watching these messages about content we have immediate access to the content itself and can transact right there. Our TVs, our computers, and our phones are learning us. 

And people are listening. In technology and the trade that follows it there is something called crowd sourcing. I heard Jason Kilar, the CEO of Hulu, speak on a panel addressing the monetization question the other day and he mentioned that he uses a part of Twitter called search.twitter.com and said he checks it hourly as Hulu introduces new functions. The audience talks to him immediately. The crowd is sourced as a resource - and it is all about the audience. All movie execs will hopefully one day be doing this, and the distribution platform will have to be as flexible.

And not only that, other people and platforms can pick up the torch and take it a step further.  Netflix offered a million dollar prize and will soon be awarding it to a team of scientists who could improve their recommendation engine by 10%. To do this they “open sourced” a bunch of codes so scientists could help them achieve their goal - because - in the moment where all content is trying to find us, it has to know what we like.  Filtration is everything.  Targeting and personalization are gold.

So what of the traditional marketing methods? A client recently came to LA about two weeks before the release of “Inglorious Basterds.” He remarked one day… “Where were all the ads? Where was the outdoor campaign?” A bunch of movie execs listening were playing a bit nervous. Was the Weinstein Company supporting the film enough?  After all, it’s a Quentin Tarantino movie with Brad Pitt for God’s sake. I hopefully don’t need to tell you that the film opened to exceptional numbers. Today, after about three weeks, it is probably crossing the $100M mark domestically and close to $200M worldwide, and a very savvy bunch of people thought they may not be marketing the movie strongly enough. What happened?

I went searching for the answer and I found the obligatory Twitter article. Stars were apparently twittering from the red carpet at Comic-Con all the way to the premiere. Not only that, while we might not have seen the ads in outdoor LA billboardland, I learned that The Weinstein Company did some very strategic TV buys by sponsoring presentations of two separate TV shows, one on an undercover cop drama on TNT, and one the “Ultimate Fighting Championships Live Vegas Event” on Pay Per View. Very targeted marketing was the answer, and smart use of the social web.

What this means is that the new way of marketing in the changed world is not just complementary to older, traditional marketing. “Basterds” shows us, as do a growing number of films, that it can be a replacement for the traditional, and likely a much more cost effective version.
Peter Dekom, the famed entertainment attorney, gave me an advance copy of a book he is working on and he calls the new world “Shredded” - what was there before you can still touch, in essence, but it doesn’t really hold together in the same ways.  He says there has been a “big media reset” and had this great quote from Harold Rosenberg - which I thank him for including in his book -  says “Revolution in art lies not in the will to destroy but in the revelation of what has already been destroyed.” 

He postulates that use of the traditional and business as usual will likely only get you what’s left of the demographic world (age and gender based targeting) where psychographic - in the Weinstein’s case, people who like “Ultimate Fighting” might like a violent Tarantino movie about guys.

Peter boils down our choices in marketing.  You either target your niche market, or be the loudest to rise above the din (and extremity is everywhere - in studio tent-pole marketing, as well as in politics). But lucky for us, we can use the advice to be super-relevant to our well defined niche enthusiasts.
Again, the AUDIENCE has the power - and the engines, platforms, websites, individuals who can aggregate audience, gather eyeballs, create a following, learn from them and tweak marketing messages based on consumer behavior. 

Think about how this dynamic layer of information and interactivity has affected your life, and then understand that it has an impact first on our brains and then on how we make choices - how we choose political candidates, choose brands, choose movies.  Can you go into your average video store and have the clerk know every movie you ever rented and what you think of it?  No, but Netflix can.  Do you look at a billboard the same way that you used to? Studies show that digital billboards have a greater impact than the static key art ones - they are dynamic and look a lot like that other screen you stare a lot at during the day. In that video we learned that students who take a class by podcast have higher retention than those who sit through the same lesson in a large college sized classroom.  Suddenly having thousands of four year universities and asking students to get all their learning from one institution in one place seems strange, doesn’t it?

And what is happening here in our business? And what should it look like? Once again, let’s throw some tidbits up on the bulletin board and flex our data gathering muscle, and then let’s cross train the second and more important muscle - the skill of pattern recognition.

Theatrical

In a world where you can have movies where you want and when you want, and the even better news is that you are all out there marketing to one another, what is happening to theatrical? Jim Stern said in his speech this past summer that people will watch movies in theaters and they will watch them at home and both are good for business. The numbers bear this out. Movie watching is robust. 71% of adults in this country say they watch one movie per week across all platforms. And we will look at all the platforms, but let’s look at what is happening to theatrical first. We’ve all read that box office is up 7% year to date over last year, right?

Now this is a graph of MPAA data of theatrical, adding DVD and Pay TV revenues, the two big dogs in the business for a long time. What we might notice in the long run if we apply patterns we used in high school is that this curve will peak and come back down (and yes we know that Hollywood is in major detox weaning off the junk of these huge incremental revenues they have been receiving for years from Pay TV and DVD).  But there are two bits of good news - something always replaces the “old” technology, and we will get to digital in a minute… but LOOK! People will always go to the theater!  AHA!  If you look at the theatrical bar it is not that vastly changed over the entire history of the movie business.

Now, each year you have more screens doing the work for the same audience, but if you compare admissions in years relevant to us, they are virtually flat for 10 years. MPAA statistics show that between 1999 and 2009 admissions wavered only between 1.4 and 1.6 billion in fits and starts, back and forth. 

Dear theater owners, fear not… you are not going anywhere.  And with digital conversion and the ability in the near future to program a multiplex like a cable channel - different films every matter of hours and days versus the rigid one week runs of heavy prints locked on platters - Tuesday night doc night, 10pm horror shows, mommy and me, mommy and anime! Anything is possible! 

According to the National Association of Theatre Owners, Tuesday night represents only 22% of what Saturday represents to their weekly bottom line. That Tuesday night occupancy can only go up if together we can crack the code of how to work with the theater chains in the digital cinema near future to help them fill seats and sell concessions on their off-peak nights. Thom [Powers] and “Stranger than Fiction” do it in New York 30 plus Tuesdays a year. I am sure if I locked you all in this room you could figure out how to fill Doc Tuesday across the nation.

Now the flip side is that while 71 % of adults watch 1 movie per week, 75% of those prefer to watch movies at home. And while box office revenue overall is up, Indie box office, in comparison is down.  I have seen numbers 20-50% depending on who and when you ask.

Let’s look at docs to see if we can see a pattern of what might be happening in the specialty film space overall.

Documentaries and What I learned from Netflix

What I started to recognize when I worked at Netflix is that certain types of films, stories, subjects, are more “lean forward” or “lean back” in nature. Does everybody know what I mean when I say that? Lean forward was first referred to with interactive content and the nature of being on line… you lean in to your computer and get sucked in to the experience interact with it, get so stimulated by the story pickup your keyboard, talk at the water cooler, you do stuff. Take action.  Lean back is - kickin’ it at home with the lady friend on the couch, taking in a movie. Feet up… a more passive viewing experience.