HOLLYWOOD, THE INTERNET, KIDS

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Want the scoop on Tony Soprano? Wondering whether Big Pussy's really dead? Or just curious what goes on in Meadow Soprano's head? Fuggetaboutit. If you're looking for the untold stories of the Sopranos, investigative reporter Jeffrey Wernick's got the skinny at his eponymous site (www.jeffrey- wernick.com).

At first sight, Wernick's project may seem like just another amateur fan site dedicated to HBO's critically acclaimed The Sopranos. But the details and special content might make you wonder. Wernick delivers daily doses of Sopranos sleuthing, ranging from news about Tony Soprano's latest hits to transcripts of A.J. Soprano's chat sessions with buddies, and even details from the compounding FBI file on Tony and his “family.� You'll get video clips and FBI snapshots, sound clips and authentic looking documents. And you'll pick up insights into the complex personalities of every character on the show.

But if Wernick's name doesn't ring a bell, there's a good reason. Wernick is a fictional character seen for a minute in the first season of The Sopranos, now resurrected by HBO to help market the hit show. In Hollywood, where high stakes and high creativity have made movie studios a bastion of marketing innovation, this is cutting edge.

Ads and trailers? Been there, done that. Guerilla marketing and event marketing? Everyone's doing it already. But build the right Web site, get a viral effect going to spread the word, and cultivate a following of people with an affinity for the movie, and you're likely to start filling up seats (or adding subscribers, in HBO's case). At least so the latest thinking goes.

Over the past two years, almost every studio and film distributor has embraced the Web as a critical marketing medium, a means of reaching audiences directly and getting them to talk about its movies with their friends. Far from the impersonal ads and one-off guerilla campaigns studios have pioneered and now rely on, the Net is re-emerging as a strategic channel for cultivating buzz, building a community of avid viewers, and, most importantly, making an emotional connection with moviegoers. It's also an efficient way of reaching the all-important demographic of 12- to 24-year-olds who make up a sizeable portion of moviegoers.

In fact, the biggest secret of marketing movies on the Net isn't viral marketing or the chance for a little one-on-one, it's the chance to get closer to kids. By far the largest single moviegoing demographic, kids also distinguish themselves as one of the hardest audiences to reach. Nearly six months after the Federal Trade Commission released a scathing report that found studios knowingly market violent entertainment to kids, studios are grappling with how best to reach their bread and butter without resorting to marketing that can get them into hot water. According to Jupiter Media Metrix, the number of children under 12 online will grow to 26.9 million by 2005, representing one of the fastest-growing demographics on the Web. Kids between the ages of 12 and 17 represent 12 percent of the total online population, up from 8 percent only a year ago. And while kids don't spend as much money online as adults, they play a significant role in offline purchases — including movie tickets.

Hollywood marketers unabashedly admit the main target for their efforts is teens. According to research by the MPAA, 12- to 24-year-olds accounted for 40 percent of the movie- going market in 1999, and their share is growing. Equally significant, teens go to the movies more frequently: Close to half of those between the ages of 12 and 17 say they are frequent moviegoers, meaning they travel to the cineplex at least once a month. Just 28 percent of adults over the age of 18 say they do the same. And if that's not enough, adults with teenagers continue to be the highest proportion of frequent moviegoing adults. “Kids get a lot more attention because they're a lot harder to find,� adds Steven Flynn, executive VP of marketing at USA Films. “It's always the films targeting the youth audience that cost the most to market.�

Besides their widely varying demographic and psychographic patterns across the nation, kids' trends and habits change quickly, and they easily tire of the same old thing, marketers note. And more significant, many say, kids can easily tell when they're being marketed to. Compare that to adult moviegoers, whose habits are set and easier to predict, and it's no wonder kids get the majority of marketing dollars.

But marketing on the Net promises another solution, allowing studios to more accurately reach their target audiences, and more significant, build a connection that goes far beyond the shrill or violent ads struggling for kids' attention. With a more direct connection, studios can turn to marketing plans that do without the violence that creeps into trailers and TV ads.

Of course, movie Web sites are far from new. Almost every movie released in the past several years has had a complementary Internet site offering details about the movie and its stars. What's changed is the attention studios are giving those sites and what the sites are trying to accomplish. Ever since Artisan Entertainment used savvy Web marketing to elevate The Blair Witch Project from a campy teenage fright flick into a mega-hit, studios have embraced Web promotion as the fourth pillar in their marketing strategies. What was once an experiment now complements a studio's TV commercials, newspaper ads, and publicity efforts. And movie sites are no longer afterthoughts; in fact, most studios are launching sites months before each movie's release to get the buzz going.

The most innovative studios are using the Web not for fan appeal but as extensions of the movie itself. Like Jeffrey Wernick's project, flicks like X-Men, Lord of the Rings, and Series 7 all have complementary sites with tangential plot lines, special footage, and countless other features, to deliver an experience that captures the essence of the movie. Some studios are going as far as hiring independent Web designers and hosts to put up “fake� fan sites to further build buzz. At the heart of it, marketers agree, is the intimate, one-on-one feel the Web delivers that a blaring 30-second ad simply can't.

“The idea behind all our sites is to deliver ancillary story lines that give viewers more of the experience of the show,� says Sarah Cotsen, vice president of HBO Interactive Ventures. “In the case of The Sopranos and in the case of all our other sites, the goal is to build a community.� Most site visitors come through HBO's main Web site, Cotsen notes, but jeffreywernick.com plays up the experience of the show even further. You won't find headshots or bios for any of The Sopranos' stars there. And don't expect to hear gossip about the actors' private lives, either. Just maintain your suspension of disbelief, and characters like Paulie Walnuts become larger than life.

In much the same spirit, New Line Cinema is pouring millions into its online effort for Lord of the Rings, the big-budget film version of the J.R.R. Tolkien classic saga due for release in December. At lordoftherings.net, New Line constructed another world online, complete with fantasy tales, teasers, and scenes from the making of the movie. New Line's marketers say they will roll out new content weekly through 2004, when the last film in the trilogy will hit movie screens. “The [Lord of the Rings effort] is such an enormous undertaking that by sheer scale alone it's impressive,� underscores Amorette Jones, executive VP of worldwide theatrical marketing at Artisan Entertainment.

Jones should know. When her marketing team took over The Blair Witch Project in 1999 for $1 million, it ended up with a $142 million megahit that remains unmatched for its use of the Web. Artisan took a site first developed by Haxan Films and turned it into an adventure tale separate from the movie, offering weekly teasers that got its young visitors hooked. The largely text-based site offered few frills, but it delivered a unique and engaging story that was somewhere between Dungeons and Dragons and Texas Chainsaw Massacre. “What we were really creating was a myth,� Jones notes. “It allowed us to build out the story and add to it.� So compelling were the tales, she and others note, that at some point visitors wondered whether the story was real.

Industry insiders note that Blair Witch's marketing worked so well because of the sense of investigation and discovery on the site, coupled with a viral element that spread word about the film quickly. “It was a unique tale, and when it was presented on the Web, it became an investigation,� Jones says. “People felt invested in the story and felt like they owned a piece of it.� And as they let more and more of their friends know about it, box office sales ballooned.

Artisan is working for the same effect for its latest release, The Center of the World, and its upcoming release of Raw Deal: A Question of Consent. For Center of the World, a film about love and sex in the technology age, visitors are led through a strip club separated from the scene by a clearly demarcated screen to underscore the film's mood. For Raw Deal, a film about a rape in a college fraternity, Web site visitors will be able to give their input and opinions on the case and will be encouraged to interact about the theme of the film. The technique has been so compelling that many consumer goods companies are emulating the studios, building interactive sites to reach their more targeted demographics. Nabisco, for example, built a site designed like an amusement park for its food products, with individual brand sites featuring games, music, and other interactive features. Pepsi's effort includes a music challenge and various other games. And McDonald's effort features Ronald McDonald's “Big Book of Fun� which includes games, puzzles, and slide shows.

In 2000, less than 1 percent of all marketing dollars were spent on the Web.

Year Newspaper Network Spot TV Internet

Online
Trailers Other

Media
Other

Non-media
2000 15.6% 23.8% 18.3% 0.7% 6.4% 18.8% 16.3%
1999 17.6% 23.5% 19.8% 0.5%* 7.8% 15.4% 15.5%
1998 15.9% 24.1% 18.2% N/A 4.7% 18.2% 18.9%
1997 15.8% 23.8% 21.0% N/A 4.5% 34.9%
1996 18.2% 23.9% 22.4% N/A 5.2% 30.2%
1995 19.5% 23.0% 24.4% N/A 4.6% 28.4%
1994 21.8% 21.3% 22.8% N/A 4.6% 29.5%
1993 22.0% 21.5% 22.7% N/A 4.4% 29.4%
1992 22.3% 21.2% 22.3% N/A 4.0% 30.2%
1991 22.4% 21.9% 21.2% N/A 5.3% 29.2%
1990 23.8% 21.2% 23.0% N/A N/A 32.0%

* Updated, based on member company revision

OTHER MEDIA INCLUDES:

  • Cable TV/Network TV
  • Network radio
  • Spot radio
  • Magazines
  • Billboards

OTHER NON-MEDIA INCLUDES:

  • Production/Creative services
  • Exhibitor services
  • Promotion & publicity
  • Market research

Source: Motion Picture Association of America

But just how much of an effect can the effort deliver? Most marketers judge their results holistically, and as yet have few yardsticks to measure the effectiveness of their Web efforts. But new research by University of Southern California marketing professor Fred Zufryden suggests Web site use and ticket sales are directly related. In a study published in the Journal of Advertising Research last year, Zufryden found that Web site traffic is statistically significant in predicting the box office take of a new film. He combined data from several movies on the number of screens, film grading and critics' scores, time from release, production budget, and seasonality together with Web site traffic data to build a model that accurately predicted the life span of several popular films, including Eraser, Murder at 1600, and Space Jam. Although his results were empirical, they showed that a spike in Web site traffic soon after the release of Space Jam, for instance, corresponded to an uptick in the box office take for the movie.

“This leads me to the conclusion that it's beneficial to have a Web site, and also that the Web site itself may serve as a source of data on a film's awareness levels,� Zufryden says. (He notes, however, that the study has several limitations, including lack of data on various advertising effects, and competitive effects from other films. Still, he stresses that his model could be used in practice by the industry.)

Indeed, the rise of the Web is proving that some movies can survive on word of mouth alone. “One thing we see a lot is overspending on advertising in the industry,� says Jehoshua Eliashberg, professor of marketing, operations, and information management at the University of Pennsylvania's Wharton School of Business. “There are quite a few movies that can sell tickets based on word of mouth alone.�

Where better to spread word of mouth than on the Net? And yet, Hollywood is not as compelled as it may seem to be. Despite the rising budgets of most movie studios, Web marketing expenditures are barely a ticket stub compared with the money spent on other media. According to the Motion Picture Association of America (MPAA), Internet marketing costs amounted to only 0.7 percent of the average $27 million spent marketing each movie in 2000. While that figure is up 40 percent from only 0.5 percent in 1999, it's a number that could be missed entirely on a balance sheet. (In comparison, 23.8 percent of the $27 million was spent on network TV, 18.3 percent on spot TV, 15.6 percent on newspaper ads, in addition to 6.4 percent on trailers.)

ON WITH THE SHOW

While 12- to 24-year-olds comprised 22 percent of the total U.S. population, they made up 41 percent of the total moviegoing audience in 1999.

Age Group Percent of Total Yearly Admissions Percent of

U.S. Population

in 1999
1995 1996 1997 1998 1999
12-15 9% 11% 9% 10% 11% 7%
16-20 16% 16% 17% 18% 20% 9%
21-24 11% 11% 11% 9% 10% 6%
25-29 12% 11% 12% 10% 12% 8%
30-39 20% 18% 19% 17% 18% 19%
40-49 16% 16% 15% 16% 14% 18%
50-59 7% 8% 9% 11% 7% 13%
60+ 10% 8% 9% 9% 8% 20%
12-17 14% 16% 14% 17% 17% 10%
18+ 86% 84% 86% 83% 83% 90%
Source: MPAA

“The media mix is just starting to shift significantly now,� says Tommy McGloin, senior VP and general manager of AOL Moviefone. “Some of the most breakthrough campaigns are coming from the Net because of its flexibility and the potential for a viral effect.�

Yet the Web is far from foolproof, and as spending on Web marketing grows, movie marketers may find some of their efforts backfiring. Ironically, what made Artisan's effort on Blair Witch so successful made its sequel to the movie a bomb in 2000. According to various reports, a backlash against Book of Shadows: Blair Witch 2 began months before the film opened, as negative buzz that Artisan was releasing “just another slasher movie� kept many moviegoers away. And negative reviews circulated on the Net, with many critics congregating on the same fan chatboards that made Blair Witch a success story.

“What the Internet really promulgates is the quality of the product. If it's good, the Net helps. If it's not, it could really hurt,� stresses Dave Holtzman, CEO of Opion, which tracks the spread of word of mouth on the Web. “The Net is a big megaphone for word of mouth.�

As a taste of how powerful that can be, HBO says it signed up over 180,000 visitors to its site for a regular e-mail letter offering further details about The Sopranos and upcoming episodes. HBO also has countless other projects in the works for its original shows. “This is not necessarily a new idea, but its one we've embraced and the fans have embraced,� says HBO's Cotsen. “But ultimately, this all speaks to the strength of the shows themselves.� More than anything, however, it speaks to the strength of viral marketing.

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