Hollywood's Broke Part 4: The Innovation Deficit

Last week, in Parts 1 – 3 of this series, I examined some of the inherent flaws in the Hollywood manufacturing system. This article will suggest how those flaws permeate the system so completely, that innovation is stifled, leading the repetitive creation of homogenized product.

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Considering the extent to which fear controls decision-making in Hollywood, it isn’t much of a stretch to assume it also controls how content, particularly film, is marketed. Television isn’t the issue here, quite as much as feature films. If there is any doubt that marketing capital is being flushed down the toilet by the major studios, one need only look in the entertainment section of any major newspaper. Gigantic ads for movies still fill most of the pages. Hollywood doesn’t seem to notice that newspapers are dying a quick death, that their primary demographic doesn’t read newspapers, and that anyone who wants to know the location and time of a movie has a portable communication device with them at all times.

Meanwhile, the percentage of total media spending that the studios allocate to the Internet will be about 7.7% this year. This is all they allocate — while the Internet has essentially consumed eyeballs across the entire globe.

Even worse, the dollars they do spend online are utilized in the most unimaginative ways possible. There’s certainly no denying that money spent on trailers is extremely well-spent. Latest research shows trailers are the third or fourth most viewed items online. Beyond that, however, advertising is generally limited to straight-ahead websites for the movie in question. As one web designer who handles most of studio websites told me, “The marketing people keep giving me the same stuff to do, over and over, because they are too afraid for their jobs to work out of the box.”

It’s astonishing, given the studio’s advertising budgets and that technology allows them to do just about anything, that fear is allowed to trump the most valuable of capital – selling the product. Even more amazing, the Internet’s lack of creative boundaries could permit studios to engage in the most radical, experimental, and daring advertising campaigns ever seen. And yet, they won’t – even though there have already been paradigms in place for a decade. The Blair Witch Project presented the most rudimentary form of imaginative marketing that unquestionably helped propel the film’s success. Cloverfield did a nice job of it, and The Dark Knight, with its guerrilla-style, immersive, real-world approach all had an impact.

In other words, it’s all about trans-media, folks. And you better click on that link in the last sentence. And by trans-media, I don’t mean some lame-ass MySpace page. Even better, trans-media relies on creative ingenuity — true out-of-the-box thinking – as much on storytellers as it does marketing folks. That means bringing the creative elements of a film into the process – creating a partnership rather than an antagonistic relationship. It means doing it early. It means paying them a little extra, but they’ll gladly do the work because their interests are aligned with those of the studio.

Further, the method of incorporating all levels of media – including cellphones, text messaging, you name it – has the same goal as traditional advertising: get the viewer to buy (or see) the product. The difference is that its requirement for immersion requires the viewer to invest time. The more time they invest, the more connected to the product they become, the more likely they are to become ambassadors for that product, and the more likely they are to see the darn movie.

Trans-media also has a good pedigree in television. The Lost Experience, produced by Javier Grillo-Marxuach, was a terrific immersive experience that was done on a limited budget. Yet anecdotal evidence suggests that the network felt the campaign had no merit because it didn’t generate revenue. What they failed to realize was the intangible benefits yielded by the campaign, namely, keeping the show in viewer’s minds during summer hiatus. In today’s market, that is absolutely essential. Viewers have far too many media choices to chose from, and they have lives to lead, as well. A six-week hiatus of Heroes during the spring of 2007 cost NBC almost 20% of its audience – which never returned – and that show was the one hit of that season! With the degree of audience fragmentation, and the infinite choices that now exist, the studios need to redeploy marketing capital into constant, trans-media-related campaigns, to keep audiences aware of their product all the time, every day.

Tomorrow morning I’ll discuss how Hollywood should alter its method of manufacturing, and how it should specifically redeploy its capital.

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