MARKETING: STUDIOS STILL SPEND BIG BUT WHERE THEY'RE PUTTING THE CASH IS SHIFTING (VAR)

By Nancy Tartaglione

Film marketing remains as shrouded in secrecy as the inner workings of the CIA. And while studios are cutting costs across the board, they fork over as much as ever on marketing. But where they're spending that money is shifting, says Variety.

In the first two quarters of this year, $1.7 billion was spent to promote theatrical releases, a 1.2% gain vs. the same period in 2008, according to Nielsen Monitor-Plus.

TV and radio remain the cornerstones of spends, at 60% to 70% of a promotional campaign's budget. But with audiences turning to everything from text messages to Facebook to TV and the Internet, studios are spreading their marketing cash wider.

While the money spent on digital marketing has increased, it's almost surprising the totals aren't higher, the trade notes. In 2002, an estimated 1% of a film's marketing budget was allocated to digital. A few years later, that figure rose to 4.4%. Today, 8%-12% of the marketing budget is devoted to new media.

And while studios spent about 14% of a film's marketing budget on newspaper ads in 2004, and 10% as recently as 2007, they now allocate maybe 4%, studio insiders told Variety.

Meanwhile, the downward shift in print ad placement has huge ramifications for big-city newspapers. Not long ago, the usual practice was to take out full-page or two-page ads on the Sunday preceding a film's bow, then on opening day, and once or twice each weekend for the next few weeks.

Today, the number of print ads has dropped sharply, even in the mainstay New York Times and Los Angeles Times.

There is one demo that studios do still rely on newspapers to reach: older adults.

"Newspapers aren't a decision-making medium anymore, except for older audiences and movies that are really review-driven," one studio chief told Variety.

Other marketing traditions, like static movie billboards, have also become an endangered species or have been shifted to supplement online campaigns.

It's a reflection of the increasingly cluttered media environment that building awareness of a movie now demands more than just delivering a message passively to prospective audiences. It's now about engaging them more directly, Variety notes.

In the US, the studios are doing more word-of-mouth screenings and local promos, such as cable TV campaigns. Such focused approaches make more sense than spending big money on newspaper advertising and big network TV.

For veterans of the marketing game, such localized efforts recall Hollywood's roots back to the silent-film era. What is new is that studios are also finally learning how to harness the Internet and social networking to their advantage.

"There are so many ways for people to communicate instantaneously," a Paramount exec told the trade. "One person who comes to a screening tells lots of people about the movie, or (tweets) about it, or posts something."

While Internet ads do cost less than traditional media, studios are still spending as much as ever in two traditional areas: television ads and trailers.

"There are only a few places left that get a huge audience, like the Super Bowl. Marketing has become a more complicated science," one studio chief said.

One former studio exec, however, said studios are still spending too much on trailers. While studios used to produce trailers in-house, trailer production is now routinely outsourced, with costs ranging between $100,000 and $300,000 to produce each one, according to Variety estimates.

Such considerations of cost and impact will continue to confront the majors as they face increased pressure from their parent companies to reconcile the bottom line.

"The landscape is shifting. We're sort of betwixt and between," one studio marketer told Variety. "While everyone is clearly focusing on the Internet, we're just not at a place yet where we can do less television. That's why it's such a confusing, interesting and scary time."