Wednesday, January 19, 2011

Is Hollywood Listening?

There is panic in Hollywood. I’m sure in the offices of Hollywood executives there must be a feeling of doom and gloom. The latest attendance figures for 2010 have just been released, and they are not good. The number of people who are gong to the movies has dropped 8% from 2009. To make matters worse, 2010 was the lowest year in attendance since 1995.

That kind of news will spread panic. As I write this article, I wouldn’t be surprised if Hollywood executives have called in the six-figure experts—marketers, gurus, and pundits—to get their advice and expertise. So what can be done to reverse this troubling trend? I could save Hollywood a lot of money. They don’t need to drop six figures on their so-called experts. In fact, anyone who goes to the movies can tell them what’s wrong and how to correct the problem. The question is are they listening.

First, it’s about the product. It doesn’t matter if it’s good or bad economic times. People want to go to the movies. I don’t know anybody who doesn’t want a night out. And movies are still the cheapest form of entertainment available for the masses. But it all comes down to the product. If you put movies in the theaters that people want to see, they will come. It’s that simple. But the reality is that the product that Hollywood is currently offering the public is not up to speed. They make the same movies over and over and offer a constant stream of reruns, retreads, sequels, and remakes. Today’s audiences want something new, original, and fresh.

Look at the recent success of The Social Network and Inception. They were both new and creative concepts. What Hollywood is afraid of is failure. That’s why they are unwilling to take chances. They want to continue to go back to what has worked in the past. That doesn’t work any longer. Audiences have figured it out. They are tired of paying their hard-earned money to see the same movie over and over.

Second, it’s about selection. At best, moviegoers have the choice of two new movies opening on any given weekend. It wasn’t that long ago that Hollywood was releasing four or five new movies every weekend. The numbers don’t lie. In 2010, 141 movies received major distribution compared to 158 movies in 2009. The number of new releases has been decreasing throughout the last ten years. The major studios are no longer interested in acquiring independent films. That’s one of the major reasons why the numbers have dropped dramatically.

A recent seminar I attended in Los Angeles revealed the studios attitude toward small-budget and independent films. The studio guy said that 9 out of 10 indies from major studios failed to make money. They were now focusing and concentrating their resources on what they call tent-pole movies—films aimed at a mass audience. What I think Hollywood has failed to understand is the “one independent film” that made money for them is usually a hit and that one movie makes enough to offset the cost of the nine who failed to generate a profit. But, by not releasing more films in the theater, they lose that energy of the audience who would have gone to see those films.

Let’s say you go see an independent film and view a trailer in the theater for one of the studios’ tent-pole movies and it motivates you to see it the next weekend. Guess what? By not acquiring independent movies, you just lost that opportunity.

Third, the price. As we all know, ticket prices continue to increase. But that’s only part of the problem. It’s the total price that continues to go up. There’s the cost of gas to get to the theater, concession prices and the cost of a babysitter. At some point, it could price the average moviegoer out of the market completely. It could be just more convenient to stay home and rent a movie to watch on your big-screen TV. Here’s one example that doesn’t make any sense. My local theater offered discounts on Wednesdays, but recently they have posted a sign that states that because of contractual obligations, they can no offer discounts within the first two weeks of a movie’s release. Hey, that’s when people want to go see new movies. And you wonder why attendance is dropping.

Final thoughts. Right now Hollywood is living on borrowed time. Thanks to the recent craze of 3-D, overall revenues have offset the declining attendance figures; however, 3-D will not save the day. It’s impact will wear off, and the $4 surcharge will start to discourage some moviegoers, especially since Hollywood is converting films shot on 2-D into 3-D. The bottom line is that it will come down to a better product, innovative storytelling, selection, and a determination to hold the prices to a reasonable level that will bring back movie attendance. So, is Hollywood listening to the audiences, or are they listening to their six-figure experts? I hope, Hollywood executives, I have saved you some money. And if you are so motivated, feel free to send me a check.

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