Saturday, September 5, 2009 at 7:23PM
We reported last week that this was a record summer for Hollywood, edging out 2008 by about $10 million. And it was an interesting mix of success stories and failures. As expected, Transformers: Revenge of the Fallen was the top choice for moviegoers...except you could argue that it really wasn't. Because if this summer proved anything, it's that the open weekend is overrated.
True, Transformers earned the most money, even though critics hated it. That brought the
old argument back that people don't listen to reviewers and that they simply don't matter anymore, a sentiment echoed by G.I. Joe director
Stephen Sommers in early August, when he did a victory lap over the film's number one opening.
Both films are from Paramount, both films had big opening weekends, but neither film continued to
perform to that level once the marketing died down.
That's why the real winners from this summer are those films that continued to attract audiences
well after the first three days and the millions of dollars spent on advertising. In my mind,
there are five enormous hits that all played by these rules and really only two that survived by
the opening weekend model, Transformers and Harry Potter. And it's great if you're on one of those teams, but most of the money this summer
came from films that kept finding audiences weeks after the fact and were designed to do just
that. Most movies that relied on opening weekends didn't meet the challenge: Wolverine, Terminator,
G.I. Joe, Land of the Lost, and The Taking of Pelham 123 were all disappointments.
In order, those five movies that capitalized on word-of-mouth all summer long are The Hangover, Up, Star Trek, Ice Age: Dawn of the Dinosaurs, and The
Proposal. From where I sit, The Hangover was hands down
the movie of the summer. It wasn't even supposed to win its opening weekend, but even though it
surprised with $44 million in that frame, nobody, anywhere, thought it would make $200 million,
much less $270 million to become the number two comedy and the number three R-rated movie ever
It's a little difficult to compare the top two earners this summer in terms of total revenue (but
not profit margin) with the movies we believe were bigger winners because Revenge of the
Fallen and Half-Blood Prince both opened on Wednesdays, making it a little harder to
compare weekends. So instead of looking at the first three days, we're going with the first two
weekends because by that point, most of the advertising has slowed down for all the movies and
people residing on the fence on any of those movies will have had a chance to make up their minds
about buying a ticket or staying home. In other words, the test of the film on its own merits is
more pure a couple weeks in.
In terms of raw dollars, if you compare The Hangover to Transformers after their
first two weekends, The Hangover actually earned much more money: $165 million to $106
million. The difference is that The Hangover had already more than doubled its budget by
that point and was running on pure profit. Critics also happened to love it. So did audiences.
Imagine if Revenge of the Fallen was as good and fun as the first Transformers.
Think of how much more it could have made by continuing to generate audiences the way The
In fact, if you extend that argument, Up made around $150 million after its second weekend,
Trek made $109 million, and The Proposal earned just under $100 million even though
it came out five days ahead of Transformers, which was supposed to turn the skies dark for
everything else in theaters. So even compared with the big, bad Transformers, when it was
left solely up to word-of-mouth weeks after the critics and the talk show circuits made their
cases, The Proposal was nearly as popular as the alien robot movie, and significantly more popular
than Harry Potter, making nearly 20% more. And as you go up the chart in comparison to the
boy wizard, the numbers are more impressive for our other four winners.
So do you want a big opening weekend or better results over the long haul? If you're Stephen
Sommers, it's the first answer; his remarks about how out of touch critics are with the mainstream
moviegoer were undercut when those same moviegoers ditched his film pretty early. Even though it still has a few
weeks left, G.I. Joe has only earned $35 million after its first two weekends, meaning it's
running about even with its August 7th counterpart, Julie & Julia.
Actually, because it's never been in fewer than 1,000 more theaters than the Meryl Streep/Amy
Adams film (and opened in about 1,500 more), G.I. Joe is by any standard the less
successful film. It cost over four times as much to make and in the US is still working from a
deficit. And considering that there's no way Joe will double its money even with worldwide
grosses - a figure that's still well below expectations for most tentpoles - it's barely
successful by any definition in the overall scheme of things.
The two movies with the biggest earnings combined to make right around $700 million in the US.
Potter brought in more than Transformers worldwide because of its strength in the
international markets. And while we don't know the marketing budgets, we know they were huge. Last
winter, Valkyrie spent over $75 million on its advertising, and it's nowhere near the kind
of blitz we see in the summer.
So you can conservatively add $100 million or more to each budget, meaning that $700 million made
up for total costs around $650 million. Globally, it's about $1.8 billion in box office for both movies, but
there are increased marketing and distribution costs there, as well. Oh, they're profitable, but
among blockbusters, they're not the most profitable.
Suddenly, they don't look nearly as impressive when you compare them to the five films in our
discussion. The total production costs for those five films is $480 million. Of the five, only
Star Trek will fail to triple that amount in global sales. We'll estimate the total
marketing costs at $375 million. Up and Trek were probably in the $100 million
range; Ice Age and The Hangover were probably around $65 - 75 million, and The
Proposal was significantly less. That thing existed almost entirely on positive word of mouth
and its position as the only romantic comedy between May and mid-July.
Even if those advertising budgets are a little larger, it hardly matters; the five films earned
$1.17 billion in the US alone, accounting for more than 28% of all ticket sales this summer. In
keeping with our theme that it's not just about the opening weekend, those same five movies, after
the first two weekends, were responsible for just shy of 15% of all summer tickets sold. We should
also point out that really only two of them - Up and Star Trek - were designed to
play for keeps in the domestic market this summer. The rest of it is gravy. Ice Age is more of a global player than a US event movie, and The Hangover and The Proposal were big surprises. Total ticket sales for
the two $300 million movies after the second weekends: $180 million, or 4% of summer movie
The lesson for Hollywood in all of this is simply that audiences don't care if you spend $200 -
$250 million on a movie. That opening weekend is all about building hype, and it costs a ton of
money to do that. Or you can let the hype build itself because people who check out a movie in its
first few days tell some friends how good it is and it grows from there. It sure looks impressive
that Transformers makes $90 million in two days, but that barely covers the amount of money
spent to make that $90 million in the first place. Why not make a smarter, better, cheaper movie
that people would want to see again and again, or even just recommend to other people?
There are multiple examples of exactly that in Summer 2009, movies that beat audience expectations
first and financial ones second. And those are the real hits.