Independence Day

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Indie films attract new fans in theaters, on cable, and on the Web.

While attendance at New York City's Film Forum has risen from 250,000 three years ago to more than 300,000 last year, it's not only sophisticates who are creating this wave of interest in indies.

It's not only demographics that distinguish indie film fans from the masses who flock to Sandra Bullock's latest tour de force. Research indicates the audience is also different psychographically. They are early adopters and trend-setters.

Last August, Landmark Theaters opened a new, five-screen movie house in the Chicago suburb of Highland Park. The Renaissance Place cinema is located in a retail development, with neighbors including familiar stores such as Eddie Bauer, Starbucks, and Pottery Barn. But rather than showing the Hollywood hits you might expect at a suburban multiplex, this theater only runs independent and foreign films such as Billy Elliot, Quills, and Crouching Tiger, Hidden Dragon.

At first glance, Highland Park may seem to be an unlikely home for offbeat, lower-budget movies, but it's places like this that represent the new mainstream audience for independent films. In the past few years, a growing segment of moviegoers has been drawn to these unconventional films — with nary an explosion, avalanche, or Julia Roberts to be found in the scripts. In fact, the number of independent films released in theaters has doubled in the past decade — from 165 in 1990 to 338 last year, according to ShowBIZ Data, Inc. There are now two cable channels devoted solely to broadcasting independent films, the Sundance Channel and the Independent Film Channel (IFC). All this has helped to make indies a hot commodity in Hollywood and on Madison Avenue. “Unquestionably, independents are more popular today,� says Karen Cooper, director of New York City's Film Forum, a prominent venue for these films.

While attendance at the Film Forum has risen from 250,000 three years ago to more than 300,000 last year, it's not only New York sophisticates who are creating this wave of interest in indies. The IFC is seen in 30 million households, and its viewers are more likely to live in smaller markets, such as St. Louis, Orlando, and Phoenix. Only 24 percent of IFC viewers live in the five largest television markets, while 26 percent live in the next 15 largest markets. “We do very well on the coasts, but we've seen significant growth recently in mid-markets like Columbus and Pittsburgh,� says Caroline Bock, IFC senior vice president of marketing.

Additional demographic data on the audience for indies is difficult to come by, as there is no one company or group that tracks these viewers as a whole. That's because the audience differs dramatically from film to film — people who saw the Blair Witch Project are probably somewhat different from those who saw Best in Show. Overall, however, the Sundance Channel's 10 million households tend to be younger, more urban and suburban (as opposed to rural), more likely to have Web access, more likely to buy things through the Internet, and more ethnically diverse than the average cable customer, according to Liz Manne, the channel's executive vice president for programming and marketing. Similar stats apply to IFC viewers, of which 34 percent are 18 to 34 years old, 29 percent are college grads, and 43 percent have annual household incomes of $60,000 and more.

But it's not only demographics that distinguish indie film fans from the masses who flock to Sandra Bullock's latest tour de force. “Our research has shown that our audience is also different psychographically,� says Manne. “They are drawn to innovation — things that are new and challenging. They want to live life to the fullest,� she says. In short, they are early adopters and trend-setters.

These consumers are exactly the type that Iomega Jaz Disks and Independent Pictures targeted earlier this year, when they signed a promotional partnership. To market a new feature called The Prime Gig, Independent Pictures placed trailers for the movie on 200,000 Jaz disks. This gave buyers a chance to view the trailer without having to log on to an oftentimes slow Web site. While Independent Pictures gains exposure for its film from the deal, Iomega is using the venture to showcase the technical abilities of the disk and explore a new advertising channel. “We are very excited to be partnering with a film company that, like us, has a reputation for defining the cutting edge,� says Greg Bartels of Iomega. The deal makes sense because each company believes there is a clear correlation between their target audiences: young, tech-savvy consumers.

Yet, it's not only tech companies that are targeting the appealing demographics and psychographics of indie film fans. The Sundance Channel has signed strategic alliances with marketers as diverse as Amazon.com, Starbucks, and Joe Boxer. What does an underwear maker have in common with independent films? “We share a similar spirit,� says Colette Sipperly, vice president of marketing at Joe Boxer. While the company sells a lot of plain, white underwear, it's best known for irreverent prints “which appeal to people who are creative and independent.� Last year, in an effort to build brand awareness among an influential and receptive audience, the company sent a free pair of undies to cable viewers who responded to a Sundance subscription drive.

Volkswagen and Skyy Vodka have also jumped on the indie bandwagon. Both marketers target a similar demographic and mindset — young, urban, hip — and both had the idea of placing short independent films on their Web sites. “We're trying to align ourselves with something that's very cool now,� says Tim Brunelle, an associate creative director at Volkwagen ad agency Arnold Worldwide, who hopes to lure more visitors to the site, have them hang out longer, and burnish the Volkswagen brand with the coolness cachet that indies offer.

While the German automaker licenses its films from the Web site atomfilms.com, Skyy commissions and produces its own films. They are directed by prominent independent filmmakers, (such as Agnieszka Holland of Europa, Europa fame), and star celebrities (such as Claudia Schiffer). “The demographic for our product is trendy and young,� says Sue Hearn, public relations manager at Skyy. “Indie films, and the innovation they represent, are a great tie-in for us.� To expand on that association, Skyy sponsors 150 film festivals around the country, and announced an independent film contest last year. The winner will be celebrated in an advertisement in Variety, and their film shown on the Sundance Channel.

The indie trend is also not lost on one company where films are central to the business. Blockbuster is better known for stocking a hundred copies of Titanic than as a patron of independent moviemaking, but the company is working to change this perception. The video rental giant has been a major sponsor of the Sundance Film Festival for three years running. It has bought the rights to over 200 films at the festival for distribution on video, making it the largest single acquirer at Sundance. In an agreement with the Sundance Channel, about 3,800 Blockbuster outlets contain a rental section under the banner, “Sundance Channel Recommends.� Last year, the company announced the creation of the Blockbuster Independent Filmmaker Award, which will give one filmmaker a cash prize and a distribution agreement through its stores. And this past January, it created an entirely new division, DEJ Productions, which will distribute and produce independent films in both theaters and on video. “We're always looking at rental trends, and in the past three years we've really noticed a hunger for new films,� says Liz Greene, Blockbuster spokeswoman. “All this helps broaden our audience and attract renters who might not otherwise think of Blockbuster.�

What triggered the rise of indie films? With the advent of the videocassette recorder and cable television, more independent movies were made during the 1980s. These technologies opened up new revenue streams, outside of risky and expensive theatrical releases, making it easier to make money on smaller films. And as major studios increasingly concentrated on producing big-budget films, independents filled a void. By 1989, the year of the breakthrough film sex, lies, and videotape (which was made for $1.2 million and grossed $25 million in the U.S.), there were more than 50 million cable households. Cable viewers were accustomed to a wider variety of entertainment choices, making them more receptive to new kinds of films, says Robert Thompson, professor of television, radio, and film at Syracuse University. What's more, Thompson believes the bulge of Baby Boomers, with their literary aspirations, are attracted to the artsy, niche-oriented nature of indies. Thus, the convergence of new technologies and demographic changes in the 1980s helped create the circumstances that were conducive to the growth of indies in the 1990s.

Over the last decade, every major studio has bought or established an art-house division (Paramount Classics, Sony Pictures Classics, Fox Searchlight, etc.), in an attempt to win some of this market. As the majors have gotten involved in the production and distribution of indies, budgets for some indies have increased, and the line between independent and studio releases has gotten fuzzier. Indies have become so mainstream that they “now form an industry that runs not so much against Hollywood, as parallel to Hollywood,� writes Emanuel Levy in his recent book Cinema of Outsiders: The Rise of American Independent Film.

The Internet is fast becoming a key player in getting new, low-budget independent films in front of audiences. A slew of popular sites which allow viewers to search and watch thousands of new films — such as atomfilms.com, ALWAYSi.com, and iFilm.com — have popped up. And there are more indies than ever being made, as inexpensive digital cameras and computer editing capabilities allow almost anyone to play director for a day. And as broadband expands into more online households, Web sites expect a growing number of film fans to turn to them for entertainment. “In terms of traffic, we've been experiencing 30 percent growth every month for the past year,� says Howard Rosenberg, CEO of San Francisco-based ALWAYSi. The site now shows half a million films a month.

For marketers who want to reach indie audiences on the Web, advertising and sponsorships of online film festivals beckon. Companies like Volkswagen, Microsoft, and music companies have targeted the ALWAYSi demographic: 75 percent male; 56 percent between the ages of 18 to 34; 44 percent who spend more than 20 hours per week on the Internet; and 56 percent who own DVD players. Last year, Microsoft placed a selection of ALWAYSi movies on its Windows Media Player Web site, to promote a new version of the program and demonstrate its capabilities.

Similarly, Hollywood-based iFilm attracts advertisers such as Mitsubishi, Altoids, and Sony who want to reach its 1 million unique visitors per month. The site can place a 15-second commercial before each film that a viewer watches, just like in a regular theater. And online films have proved such an audience grabber that iFilm began holding sold-out screening sessions of its movies at selected AMC theaters. What's more, the company broadcasts a showcase of its best films on TiVo, which is seen by a million television viewers a month. As independent films win over audiences in theaters, video stores, on cable, and on the Web, marketers may be wise to take a lesson from the indie playbook: innovative, offbeat, and unconventional can sometimes be what a lot of people in the “mainstream� want.

THE NEW COUCH POTATOES

Viewers of the Independent Film Channel tend to be young, well-educated, and affluent.

PERCENT INDEX *
GENDER
Men 52.7% 110
Women 47.4% 91
AGE
18-34 34.2% 105
25-54 62.8% 106
HOUSEHOLD INCOME
$60K+ 42.8% 121
$100K+ 16.8% 130
EDUCATION
4+ years of college 29.1% 129
OCCUPATION
Professional or managerial 26.7% 131

* An index of 100 is the national average. IFC viewers are 30 percent more likely to have a household income of $100K or more than the average American.

Source: The Independent Film Channel/Mediamark Research, Spring 2000

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