Strategic Alliances

Because our business is based on artistic creation, it’s important to be out in the world watching what people are reacting to, but it’s also important to constantly examine whether the world will continue to economically reward new movies. For this reason I make almost every decision within a strategic setting.

Each time I approach production I look not only at the script, but also at the long-term viability of the script and the film it will become in the future marketplace. This does not mean I am a slave to the trends or follow the herd. That’s not only foolish, it’s impossible. What it does mean is that I try to stay attuned to what people (audiences) are responding to and why. This makes both artistic and economic sense.

After all, when we produce a new film, we're undertaking a long-term project. The process can take years and each decision can have a profound impact on the final product. Those decisions will ultimately impact the audience’s like or dislike and it always comes back to the audience. Most of the time, what audiences want are the basics of good storytelling. This is a message too many filmmakers miss.

Because films are made in stages (development, pre-production, production, post and distribution), many producers approach each of these stages as separate entities that have no relationship to each other. That is a huge mistake.

The best producers understand the connection that every element (both artistic and economic), has to every other. I have heard some producers claim that the most important stage of a film is the stage they are currently working on. That compartmentalized view not only stagnates creativity, it's fiscally irresponsible. The simple truth is that there is no single most important part of filmmaking. Each phase is equally important and forgetting that impacts both the artistic and economic.

That’s why before I begin any new project I look out into the marketplace and try to visualize who the audience is and why they will respond. I also try to structure all of my ventures as strategic partnerships, not only in terms of the relationships with production companies and distributors, but as important, in terms of management. This way I’m more certain that everyone involved in the production shares a commonality of interest and no one party dominates. How do I go about this?

First, I define the stakes and make sure each party has equal representation and equal responsibility.

Second, I try to hire people who are entrepreneurial. That's often difficult when you're evaluating expertise but on Calling it Quits we spent significant time getting the right people, people like Roxy Gillespie, Mary Margaret O’Neil and Rich Ulivella. These are people who care deeply about their craft, their department, and also about the film they are making.

Occasionally the untalented, corrupt and sometimes even criminal folks slip through. When that inevitably happens, it’s important to take immediate action. If you stop the activity as soon as you become aware of it, it sends a message and shows the talented people who actually care about what they are doing that you also care about them.

The Good Fight

Hello all, it’s good to be back! Where was I you ask…? Well, for the past couple of months I was producing a wonderful independent feature titled: Calling it Quits. I had intended to post daily about the experience, but the workload as Producer, Line Producer and Production Manager (did I mention it was low budget?), took its toll on my time. As much as I love writing, my priority was the film, so I temporarily suspended my posts.

But now I’m back and have a lot to tell you. First and foremost I wanted to thank the director Anthony Tarsitano for writing such a wonderful script. His openness, confidence, and creativity were truly inspiring. I’d also like to thank my producing partner on this film - Jeanne Suggs. Jeanne is a smart, supportive and a wonderful collaborator. Together we spent the last several months assembling an amazing team of film professionals and producing what I believe will be a wonderful film.

Producing a film at any budget is hard work, but at the budget level we worked at the hard work is multiplied several times over. This is because you don’t have enough money to hire all the help you really need so end up wearing multiple hats.

I must say the hard work paid off. The quality of the performances and the production values on this film are truly exceptional. This is directly attributable to the talent of our cast and crew. I’ve worked on bigger budget shows with larger crews, but never have I worked with better. Time and time again the crew stepped up to create sets, wardrobe, lighting and sound design that would be exceptional at 10 times the budget.

As producer on a low budget film it’s a painful fact that you will have to make compromises and will never be able to pay talent what they are actually worth. But going in we were determined to treat the cast and crew as best we could on our budget, and make sure every cent we spent ended up on the screen. I think we succeeded.

It’s an amazing thing to see all your months of planning and prep and the dozens of individuals you hired come together in a well-run, successful production. We’re now firmly into editing and scoring and we’ve been fortunate to find some equally talented people to help us here as well. I can’t wait to see the final product. I’ll keep you informed of our progress.

Market to Individuals, Reach the World - Part II

In any business, marketing and innovation are critical elements for long term success. But when a business is based in large part on artistic creation, marketing and technology often take the place of an element much more important to long-term success – telling a story.

Motion pictures and other filmed media have a phenomenal heritage in this country, but like any other business films have to remain relevant to customer’s needs or those customers will move on. We saw this happen in 2005 when the product being delivered was so universally mediocre that audience stayed away and found other ways to entertain themselves.

The reason for this was not complex. Corporations are risk averse entities that like to control every aspect of the product they offer. The problem is that the one element that has the most to do with the success of a film is the one element you simply can’t put into a formula and that means risk.

Because telling a story can’t be quantified producers and studios have turned their focus almost entirely to marketing and technology. The inevitable march of technology means upgrading the technical process of making films both in the special effects that occur on screen and the equipment used to capture the sounds and images. As anyone who has made a film can attest to, this does not always equate to a less expensive or more streamlined process, or more importantly, a better film. Technology just seems to feed a need for more technology, which equates to higher costs.

Because the costs and risks are so high, they spend heavily on marketing to make sure the product is seen. The problem with selling a film this way is that the marketers is one of scale. At a time when people more and more wish to exert their individuality, producers and marketers are trying harder and harder to ram content that appeals to everyone down our throats.

After decades of this the film industry has mutated from a business based on storytelling to a business based on marketing. Most production companies and especially the studios now approach the process of developing new filmed media from an inside out perspective that is operationally driven, instead of from demand side.

This approach has lead to the circular reasoning that we now see in so much filmed entertainment. Producers and studios sink huge sums into elements of the film they hope will protect their massive investments (stars, directors, tons of equipment), and find with each new film those elements cost more and more. They use focus groups and exit interviews to “ensure” a film will perform well enough to justify the cost of production but what they are really doing is testing the film’s marketing hook and providing a false sense of assurance.

Marketers will counter saying focus groups and exit interviews demonstrate a consumer centric viewpoint, but reasoning is flawed. Anyone who has ever conducted focus groups or exit interviews will tell you that people only answer the questions given. How can you possibly learn anything about what a consumer wants by watching them sit in a room surrounded by strangers?

When consumers respond to questions about what they want they usually answer more for less. More effects, more stars, etc. They do this because it’s what they see and know; because it’ what they’re asked. Producers and executives look at this data and develop projects designed to match the “research,” and continue to miss the boat. To truly understand what consumers want producers need to get out into the field and take a more anthropological approach to marketing. They need to observe more and listen more and place more resources into development.

The disconnect we are seeing between media and audiences is self-induced. Massive spending on production dictates that they must try to make films that are all things to all people. When we start looking at people as individuals and delivering stories with universal messages and great stories that connect to people emotionally, then we can manage the money and deliver fantastic entertainment on a budget. Then we can deliver a quieter message that the film exists and is something they might find enjoyable.

Market to Individuals, Reach the World - Part I

In the Jan. 27^th Business section of the New York Times, Michael Barraro and Hillary Chura write about the market missteps of clothing retailer the Gap. The article details the Gap’s downward sales trends by noting: “In an era of niches, when exclusion is as vital as inclusion, Gap has become an anachronism… [They’re strategy of] appealing to all has resulted in sales to too few.”

The message is one that producers, filmmakers and marketers of filmed media should take to heart. We live in a world of individuals. There is no such thing as one size fits all.

In industries as varied as automobiles, fashion and technology, smart companies are seeing that the path to success is dependent on finding niche markets and delivering products, services and media that appeal to people as individuals.

Yet if you listen to most marketers talk, you'll hear them continually refer to audiences in terms of broad demographic clusters. But when was the last time someone came up to you at a party and introduced themselves saying: “Hi, I’m 18 to 34 year old white male,” or “Hello, I’m 25 to 49 year old African-American woman.”

Producers and marketers of filmed media see a film or show become a hit and rush off to clone new projects based on this successful new "formula." And think that people would never want anything else. What they fail to see is that people are more than the sum of their demographic parts. People don't watch filmed media because of marketing - in most cases they watch in spite of it.

My audience-centric view does not mean I'm advocating we ignore marketing, quite the contrary. Audiences appreciate hearing about content that appeals to them and marketing is a way to get them that information. But the industry needs to shift focus. There is no such thing anymore as a broad-based American mainstream and the biggest problem facing the filmed media industry at the moment is their inability to embrace this. They cling to the myth of broad, homogenous audiences because having something quantifiable (however false), is comforting to people spending millions on content. They're only fooling themselves.

Overwhelming cultural and marketplace evidence continues to emerge showing that audiences are tired of one size fits all content (2006 MPAA survey, Jan 22nd Wall Street Journal article: Boss Talk, your own eyes and ears). Yet with few exceptions production companies, corporations and marketers of filmed media continue to develop one size fits all content.

So why is there a disconnect between what audiences say they want and what producers are delivering? In part II I’ll start to address that.

Truth? You can’t handle the truth!

Title: Ace in the Hole
Studio: Paramount
Year released: 1951
MPAA rating: PG
Director: Billy Wilder
Writer: Walter Newman, Lesser Samuels, Billy Wilder
Cast: Kirk Douglas, Jan Sterling, Ray teal, Richard Benedict

In the early moments of Ace in the Hole Kirk Douglas, playing a bad-egg reporter named Tatum, walks into an Albuquerue newspaper with an offer to make the editor 200 dollars a week. The offer he presents to the editor is himself, “a 250 dollar-a-week reporter for 50…, make that 45.”

The script is crisp and witty but this isn’t typical wilder fare. Ace in the hole is a badass mob boss and Douglas - an alcoholic report fired from every major paper in the North East - is the enforcer willing to break our legs at a nod of the boss man’s head.

Douglas enters the film in a broken down car being towed into town. It’s a visual metaphor for his broken down career. Yet Tatum himself isn’t broken – he won’t allow it. He is the one who breaks others whenever and however he can.

The building he enters is the small town office of a small town paper and Tatum makes sure everyone knows he knows it. In one great moment among many Tatum saddles up to the receptionist’s desk. On the wall behind her is an embroidered sign that reads: Tell the Truth. And Tatum does, but it’s always his truth he tells, and Tatum’s truth doesn’t always rely on facts or principles.

Ace in the Hole, originally titled The Big Carnival was a flop when it was released in 1951, but make no mistake, this is a great film. Audiences in the fifties just weren’t ready for this yet. The new print shown at Film Forum was exceptional and the 2-hour running time flew by.

The prescient script comes courtesy of Walter Newman with a polish by Lesser Samuels and Wilder himself. The act I set up tries to prepare us for the cynicism, corruption and violence to follow, but the depth of the cynicism - especially from Tatum - is relentless.

At the end of act I we jump forward a year in time to find Tatum still stuck at the small Albuquerque paper and still looking for the big story to get himself back into the big time news game. And here is where the story takes a truly dark turn.

En route to a small town story about a rattlesnake hunt, Tatum stops at a dust-bowl trading post and overhears a commotion. It seems Leo Minosa (Richard benedict), the owner of the trading post, has been trapped by a cave in while digging up ancient Indian burial pots. Tatum sees his chance and by God he’s going to make the most of it.

Tatum moves in like a hurricane –- flattening anything and anyone who gets in his way. He manipulates the trapped Leo, colludes with the corrupt local sheriff (Ray Teal), twists the arm of the spineless engineer (Lewis Martin), and cajoles, bullies and threatens the jaded Mrs. Minosa (Jan Sterling), all to keep Leo (“you’re the only friend I got.”), buried longer than necessary for the benefit of his copy and career. In a truly great moment Mrs. Minosa marvels at Tatum’s unrivaled, naked cynicism. "I've met a lot of hard-boiled eggs in my life," she says sizing him up, "but you? You're 20 minutes."

Perhaps the most amazing thing about this script and movie is how prescient it is regarding what we now refer to as a media circus. In this film the media circus is a literal happening, as a very real carnival sets up and hundreds of people descend by horse, by car and by train into a frenzy of cheap souvenirs, ancient Indian curses, rival journalists, carnival rides, corn dogs and oh yeah… the human tragedy of a man buried alive in the 'haunted' mine. This is CNN 50 years before CNN started over-saturating the airwaves with non-news stories sold as news to people too busy (lazy?) to care about the difference. Not a step is missed here as even the carnival name (The Great S&M Amusement Corp.), comments on the happenings.

It might seem as if I’ve given a lot away, but the film is exceptionally well crafted and deep. For the attentive viewer many surprises still wait to be uncovered. Oh and for you cynics out there…? You might think you’re tough, but compared to Douglas’ Tatum… you’re Julie Andrews.

This revue unfortunately comes a bit late for the screenings at Film Forum (I saw it on the last night of it’s run – Jan. 18^th), but if you’re a Wilder fan and want to see one of his best do what you have to do and check this out. Ace in the Hole is a superb film and Film Forum is about the only place I know of where you can see it’s like.

If you’re a film fan and don’t yet know about Film Forum then do yourself a favor and discover this treasure. This theater is one of the last great independent cinema houses in the county.

Marketing drives Hollywood

Releasing a film into the marketplace has never been tougher. As customers become increasingly sophisticated and demanding and competition intensifies Hollywood has reacted by officially making marketing their highest priority. As Martin Grove reports in the July 28^th Hollywood Reporter, “Disney and Universal putting seasoned marketing executives in charge of production are only the latest indication that marketers are Hollywood's new power brokers.”

On the surface these moves seem to make sense. With so much at stake financially (average studio production budgets now exceed $60 million), it has become increasing important to create awareness for their product. But what this marketing-centric focus fails to consider is that successfully launching a new film into the market is not just a matter of spending a fortune on promotion. Movies are a combination of commerce and culture, business and art, and what I’m seeing is that the desires of the consumer and the focus of the studios are at odds. This dichotomy is characterized by four findings.

1] The Weak Link

In a recent poll conducted by the MPAA, more than 60% of moviegoers stated they are disappointed with the cookie-cutter product Hollywood has to offer.

In their business model the studios spend hundreds of millions of dollars on a film because they’re banking it will attract a worldwide mass audience and become a franchise. But for this strategy to work each film must have broad appeal in every quadrant (men and women, young and old). To ensure this appeal Hollywood waters-down their stories, removing content that may keep certain demographics from the theater, while at the same time adding elements (explosions, effects, celebrities) in the hope these elements will broaden the film’s appeal.

The problem is when you dilute the content you remove the very thing consumers most want from their moviegoing experience – a great story. The studio strategy is faltering because it is focused solely on marketing at the expense of content and moviegoer satisfaction.

2] A Strong Outlook

According to Pricewaterhousecoopers 2006 media report, filmed entertainment - lead by digital delivery platforms and the Internet - will expand at a compound annual rate of 5.3% through 2010 to reach $104 billion on a global basis.

This is encouraging news, but what’s most interesting is where that growth may be coming from. In 2005 the top 25 films generated $4.05 billion at the box office compared to $4.32 for the top 25 in 2004, a decline of 6.2 percent. Box office tallies for the remaining films however were up 4.6 percent in 2005 indicating that smaller films continue to perform well and fuel the market.

3] The consumer takes charge

As use of the Internet has proliferated, moviegoers have gained unprecedented access to information. More than 40% of moviegoers now make their decisions about what films to see after surfing the Internet, and that number is growing (Kagan & Associates 2005). Literally thousands of web sites, blogs and discussion boards now exist where consumers can find unbiased reviews and contribute to discussions about any movie released.

This means moviegoers no longer have to rely solely on studio marketing when deciding whether to see a movie. Before spending money on gas, popcorn and tickets, consumers are listening -- and talking -- sharing their views about whether a movie lives up to the hype and is worth seeing.

4] Independent films filling the gap

Of the 5 films nominated for best picture at the Academy Awards in both 2004 and 2005, all but one were independent, story-driven films.

These successes and others are attributable in part, to a change in the demographics of the theatrical audience. According to Nancy Klasky, Vice-President of Marketing for Century Theaters, “The movie-going population is aging, so there’s more interest in a little more complicated entertainment for a sophisticated audience.”

These films are satisfying audiences worldwide, performing at the box office and doing so without breaking the bank. As an example, Spielberg’s 2005 studio film Munich cost more to produce than the other four nominated films combined - all independents - yet it won no awards and performed no better at the box office (see Table below).

2005 ACADEMY AWARD BEST PICTURE NOMINEES
TITLE	BUDGET	US GROSS
Brokeback Mountain	$13.9	$83.0
Capote	$7.0	$28.8
Crash *	$6.0	$54.3
Good Night & Good Luck	$7.0	$34.1
Munich	$75.0	$47.0
* Best Picture of the Year
Sources:
boxofficemojo.com, the-numbers.com, oscars.org

5] Bottom Line

The old adage content is king is more relevant than ever and the message for producers is that we must focus our acumen on creating meaningful, entertaining content that is intrinsically valued by a specific audience. The primary lessons I draw:

1. The quality of content matters. When content is marginal and commoditized, audiences will find other ways to entertain and inform themselves

2. Ownership of content doesn't guarantee the ability to control the business model. Audiences control the business model, always

3. Marketing cannot make a movie a hit. Marketing serves only to draw an audience the first few days of a release. After that audience word-of-mouth drives results

Team building for a successful production.

Cynics might shake their heads, but one of the most important elements of managing a successful production is team building. It's also an element that is often pushed to the back burner or ignored because it's hard to attach an immediate cost/benefit relationship. But it's there and it can be huge. In fact I have a hard time listing another industry where people management skills are more important to success. Here's how I approach it.

Trust – Be Open and Honest
Productions are always tough. Cast and crew are most often working under grueling physical and emotional conditions and it can be easy to lose perspective. Like any other workplace there are agendas and various levels of disclosure due to commercial or political pressures and the grapevine is always active. If you are keeping someone in the dark or being deceptive, I can promise it will be uncovered and talked about until it grows into a monster. I've never seen a team produce their best work under those conditions nor seen that type of management work in the long term.

When I manage a production I try to be as open and honest with the team as possible. I try to answer their questions directly (even if the response is not entirely favorable) and act as a conduit of information, not a barrier. If I feel I cannot divulge something, I say so. Everyone understands the need to sometimes keep something close to the vest but the teams I've worked with have always appreciated honestly and reciprocate by relaying information and producing.

Equality – Be fair and even handed
One of the maxims I have as a producer is “individuals can succeed but only the team can fail.” What this basically means is that you should dish out credit where it is due in public, but criticism in private. There will be times when an issue will need to be addressed and when necessary I do so directly and make sure both the negative behavior and means to correct it are understood, but criticism in front of the team is not a motivating force for anyone.

Loyalty – Protect your team
Producers and production managers have a split responsibility - on the one hand you have a duty to your client and the project - on the other you have a responsibility to represent and support your team. In a perfect world these two aims should be neatly aligned – but that's not always the case. In these situations it's important to maintain perspective and integrity. In situations where a conflict arises we must resist the temptation to air dirty laundry. Instead I try to discuss the situation with the team and come up with a consensus solution. Open discussion of the problem will encourage the team to take ownership and solve it themselves.

Building a production where people are motivated to perform at their best takes effort, but the benefits and results can't be overstated. Besides it's not always so tough. Sometimes you can move mountains just by remembering to say thank you.