Last year's box office slump doesn't appear to have kept the studios from anteing up for the traditional "for your consideration" ads leading up the Hollywood's awards season.
The ads remain a critical revenue source for show business trade publications Variety and the Hollywood Reporter, as well as an integral part of the studios' multi-million Oscar campaigns, which include marketing consultants, specials screenings, panels and targeted mailings.
And they have been proliferating, too. The advent of the Internet, with its myriad movie fan sites, has provided a new advertising platform that is being extensively targeted. DreamWorks SKG, now in the process of being taken over by Viacom Inc.'s Paramount Pictures, is making the first studio foray into marketing via video Podcasts in support of its film "Match Point." Major newspapers including the Los Angeles Times and industry publications such as the Screen Actors Guild's quarterly magazine have become battlefronts as well.
Even in these tough box office times, the studios are willing to shell out millions of dollars both because their talent demands it contracts with A-list actors and directors often include guarantees of ad placement and because the ads can boost industry awareness of a film, which can lead to awards and eventually increased DVD business.
"If a particular studio has the goods, they will really get behind it because it's in their best interest to do so," said Charlie Koones, president and publisher of the Variety Group, a unit of Reed Elsevier Inc. "The studios have to get those films seen, and does (an ad campaign) work to get people to see the movies? Sure it does."
The studios are tight-lipped about their awards-related expenditures. Executives from Sony and Paramount declined to comment and representatives from several other studios did not return messages. Nielsen Monitor-Plus, which monitors advertising spending, found that the studios spent a combined $24 million on print ads in 2003, the bulk of them on award season blurbs.
Tony Uphoff, publisher of the Hollywood Reporter, a unit of Dutch media conglomerate VNU, said the early ad buying was slower this year, as the studios place more emphasis on later purchases some involving dark horse releases. "Suddenly people change their mind, call us and want to book a massive ad buy," he said.
Both Uphoff and Koones described the award-season ad revenues as significant, but declined to provide specific figures. "Suffice it to say it's in the millions of dollars," Uphoff said.
The trades, along with the studios, had to shift gears three years ago when the Academy of Motion Picture Arts and Sciences moved the Oscar ceremony to February from March. Most of the other key industry award givers, such as the Golden Globes and the producers, directors and actors guilds, shifted forward as well, resulting in a condensed and considerably more intense advertising season.
Uphoff said the trades see two spending phases of the ad buying.
The first phase generally coincides with the fourth quarter of the calendar year, when movies first vie for nominations and critics' awards. By jogging voters' memories, the ads can be particularly important for a film released earlier in the year. The second comes after the major award nominations, when the list of contenders is whittled down.
"There's no two ways about it, the ads have a demonstrable financial impact," Uphoff said. "It can work particularly well for smaller films that didn't quite have the consumer marketing profile that the big ones did, but that because of the ads have gotten a lot more attention from the industry."
This year's award-season issue of SAG's Screen Actor magazine has grown to 96 pages from around 56. "We've had a great response, and seen a significant ad increase and revenues that support us through the summer when we have very few ads," said Ilyanne Kichaven, SAG's Hollywood executive director.
Analyst David Miller of Sanders Morris Harris said the apparently strong showing of ads this year doesn't surprise him, even in the wake of a soft box office. He suggested that the impact of the ads on ancillary profits, such as overseas DVD sales, is even more crucial to a studio in a lean year at the box office.
"The margins are very thin in the theater," Miller said. "Theatrical release is very expensive, and global home video revenues are up."
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