Chapter 8

1. Chapter 8 Entertainment Industry

2. Chapter Overview • Lesson 8.1 Entertainment Profits • Lesson 8.2 Distribution of Entertainment • Lesson 8.3 Marketing Music and Theater • Lesson 8.4 Awards and Annual Events • Lesson 8.5 Entertainment Marketing Careers

3. Lesson 8.1 Entertainment Profits

4. The Profit Makers • Only 2 of 7 major Hollywood studios turned profits in 1998, despite record audiences. • Paramount Pictures (Viacom, Inc.) and 20th Century Fox Film Corporation were successful thanks to Titanic ($1.8B tickets) • Others suffered b/c of high cost of the production and distribution

5. Cost Cutting Strategies • Cut the # of Wide Release Movies • Released in more than 2,000 theaters at 1 time • Low budget movies capitalize on the promotional budget of major movies by using similar themes in the title

6. Profit depends largely on the popularity of the film overseas Generating film revenue: Ratio of tickets sold to the cost of production process Income from: Merchandising Soundtracks Relationships to theme parks Global releases Ticket sales in the U.S. and abroad Profit and Opportunity

7. Worldwide distribution revenue is critical Fox sold nearly $2 B in movie ticket sales outside the U.S. 1998 International release can increase receipts by 50 to 100% Most films generate less than 25% of their final income from domestic ticket sales alone The 1.3 B people in China is a promising new potential audience Cultural Profit Opportunities

8. Fast Money • The difference between entertainment and sports is determined by the viewer. • Stock Car racing is one of the fastest growing forms of entertainment. • Created a mutual fund to secure financing for their expensive form of entertainment • Investment stocks from 50 sponsor companies are included • Individual drivers have 1 sponsor who pays for the car and the upkeep.

9. Lesson 8.2 Distribution of Entertainment

10. Ways to Distribute • Traditional T.V. networks • Cable • Satellite • Internet

11. # of cable channels has increased Programs are picked up by a master antenna and delivered to homes throughout the country 1 time cost to install Monthly fee New cable channels target specific demographic markets 80% of American homes had cable hook-up Cable Mania

12. Satellite Television • Allows rural areas to receive stations • Must buy a dish ($130) • Subscribe to monthly service • Offering more than 200 channels • 40 M homes by 2007

13. Internet Entertainment • Web based companies that markets sports info, interactive games, tournaments, chat rooms and sports-related merchandise online • E-commerce: selling merchandise on the Internet • Internet is becoming most valuable place to advertise

14. Movie Marketing • Trailers or previews – advertisements for other movies • Well-coordinated promotional plan can wring out the last drop of consumer interest • Pay-per-view ads can also increase video rentals. • Use suggestive selling

15. Blair Witch Project Developed web page that made it look like a real news story Added short, intriguing trailers Per-screen revenue was over $56,000 The Lion King II Bypassed theater release Sold directly o rental and sales of video ($10 mil.) Effective Examples

16. See It At Home • Videos sold at mass market retailers • Wal-Mart • Stimulate sales in music and video specialty stores through Point-of-Purchase (POP) displays • Movies on DVD may replace videotapes

17. Lesson 8.3 Marketing Music and Theater

18. Hip-hop sales inc. Marketing Rap Sampling – inclusion on a CD of excerpts Many music label executives use intuition to decide what is marketable Mainstream Rap Madison Ave in NY is home Singers and dancers featured in TV ads. Changing to more acceptable messages Today’s Top Music

19. Broadway uses: billboards, radio, upscale theater magazines, and other publications Word-of-mouth is major source of promotion Fascination with the lights and the people Rosie O’Donnell is credited with increasing sales Metropolitan Opera of New York (The Met) Duke University course Gain knowledge and appreciation for the arts Promoting Theater

20. Concerts Agent, promoter, and artists manager “Wildcat” tours cut out the agent Robert F.X. Sillerman bought out most regional promoters. Now runs 98% of the concerts MP3 Mpeg Layer 3 – pirating of music for free, illegally from the Internet Free software program Still changing by finding ways to bypass record company Distributing Music

21. Lesson 8.4 Awards and Annual Events

22. The Oscars • Most famous and prestigious award • Given by: Academy of Motion Picture Arts and Sciences • 5,000 members determine each award • Nomination is a promotional bonanza for those involved • No more than 5 nominations are made for each category • Winners featured on magazine covers, newspapers • Winning an award and getting a nomination have promotional value money cannot buy • Have 2nd highest viewership after the Super Bowl • Sunday night on ABC through 2008 • In 1998 ABC charged $915,000 per ad minute

23. National Academy of Recording Arts and Sciences (NARS) 92 Categories Winners selected by vote of the committee members Brings a lot of attention Does not guarantee success or sales New artist categories are sometimes never heard from again Examples???? The Grammys

24. The Emmys • 8K member organization • Academy of Television Arts and Sciences • Presents Primetime and Daytime • Winning shows or stars can increase the viewing audience

25. The Tonys • Named after Antoinette Perry • Served as head of the Board of the American Theatre Wing • Given to professionals in theater for distinguished achievement • Ratings up when Rosie O’Donnell was host

26. Lesson 8.5 Entertainment Marketing Careers

27. Marketing You You are the major product Know what you want to do and what it takes to get the job Gather info on the job to make a decision Know what is required How to Prepare Conduct research Sources of info Internet People you know Company reports Business directories College placement offices Recent news articles Getting There From Here

28. Marketing Jobs • Opportunities for marketers, advertisers, and public relations specialists will be among the fastest growing in the nation through 2006 • # of consumers rises – the # of artists, performers, and staged performances will increase • General background in these fields can urn into a focus on entertainment

29. Marketing Relations Specialist • Build and maintain positive relationships between their employer and the public • Looks out for the best interests of another • Keep the media and consumers aware of the company or person they represent • More opportunities in larger cities • College degree preferred combined with experience (Internship)

30. Marketing/Advertising Mgrs • Intense competition • Potential to earn high salaries • Long hours • Jobs dictated by consumer interest at the time (flexible) • Responsibilities • Strategic planning, sales, advertising, pricing, product development

31. Skill Requirements • Math, communication, interpersonal skills • Ability to communicate persuasively orally and in writing • Ability to work on a team • Creativity • Initiative • Self-confidence • Maturity • Flexibility