Why The U.S. Studios Need To Get Much Smarter In Their Marketing Strategies

Hollywood studios waste millions of dollars each year on scattershot theatrical marketing campaigns in the U.S., often throwing good money after bad.

Now, thanks to new research, studio marketers will have the opportunity to far more effectively target the key demographics for each mainstream film, not just on the opening weekend but through the course of the release.

Global film industry data provider Movio has added detailed data on the ethnic makeup of U.S. cinema goers to its Movio Media software service, the first time that info has been systematically collected. Movio profiles more than 14 million active U.S. moviegoers aged 14 and over, representing 33% of North American cinema chains and covering 29% of patrons who visit cinemas at least once a month.

The research covering every title released in the past two and a half years shows how the ethnic composition of audiences changes over the life of the theatrical season. In the opening weekend the percentage of young Hispanic males is disproportionately larger, after which the audience progressively becomes more Caucasian, older, whiter and more female.

“That suggests studios should develop multiple marketing strategies to target the different demographics at various stages of a film’s release,” says Will Palmer, CEO of Movio, a unit of the New Zealand-based Vista Group International Limited. “Studios traditionally have been measuring what happened on opening night and applying that to the entire campaign. In reality the audience is massively different in week two than it is in week one and it’s consistently different."

“By and large the studios have moved onto the next title by the time a film has been released. There may be some subtle changes during the release. What we’re empowering the studios to do is to actually make decisions on how you can change direction on a film . They need to have money up their sleeve to change digital campaigns or TV spots depending on what the data is telling them. There are hundreds of millions of dollars on the line, so that kind of information can mean the difference between success or failure.”

As a case study, Movio today released a study on the shifts in the U.S. audience composition of 21st Century Fox’s Deadpool, which grossed $363.1 million domestically. Over its entire run, the ethnic split of audiences for the superhero adventure/comedy starring Ryan Reynolds was 59% Caucasian, 21% Hispanic, 12% African-American and 8% Asian.

Hispanics were over-represented on opening weekend and opening night, by 10% and 17%, respectively, partly explained by the fact that, demographically, Hispanics are over-represented in the 15-30 demographic. The overall audience was male-skewed (62% vs 48% for moviegoing overall), relatively young (average age of 35 vs 40 among all moviegoers aged 14+) and more likely to be Hispanic (21% vs 17%).

Compared with the audience for the full run, ticket buyers in the opening weekend were 5% younger, 5% more male-dominated, and with an attendance frequency that was 4% greater. On opening night itself the audience was 7% younger, 14% more male-dominated, and with an average attendance frequency nearly 18% bigger than the that of the full run.

The audience profile was remarkably similar to other blockbusters including Guardians of the Galaxy, Captain America: Civil War, Avengers: Age of Ultron, Batman v Superman: Dawn of Justice and Suicide Squad.

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Collecting the ethnic data was a challenge, Palmer says, made possible by accessing third-party data matching services, while guaranteeing the privacy of individuals. Previous studies used exit polling at cinemas to try to profile the age, gender and ethnicity of audiences, based on very small sampling, usually in the East or West coasts.

“The really big hole in that research was that there was no history on the individuals who provided that information,” Palmer says. “You would find out this person went to a particular film and he’s male, aged 18 and Hispanic. But what was the last time he went to a film, and how often does he go to the cinema? Does he always go on Tuesdays or is that an unusual piece of the pattern? What we’re able to do now is look at the complete transactional history of each demographic and provide insights that no one has seen before."

“The studios can now decide what they need to change about their content, programming and marketing strategies. If you know that pre-sales are over-indexing on any one demographic, we can counterbalance that by suggesting the studios increase the advertising targeted at females, for example."

He cited the recent case of execs at one Hollywood studio who worried that pre-sales for a high-profile release were skewing 76% male, which would limit the audience to fanboys. By changing the TV spots to emphasize the female lead the distributor managed to attract more women, resulting in a 60/40 gender split over the entire run.

Last year Movio issued a report entitled “What Women Want: Unlocking Box Office Revenue,” which suggested the studios re-direct some of their marketing firepower to non-tentpole films to increase the overall box office.

Its study of 203 films found that 45 had an audience that was 60% men while 40 had an audience that was greater than 60% women. Although the male-dominated films had an average worldwide gross twice as big as the female-dominated films, the average gross-to-budget ratio of female-dominated films was greater: 5.1 vs. 2.3.

Since then, Palmer observes, some studios have diversified their slates, particularly Sony Pictures with titles such as Sausage Party, Don’t Breathe and the Ghostbusters reboot, and Universal Pictures. “Women make the vast majority of decisions about going to the movies yet so much of the content where all the money goes is targeting the fanboy-type films," Palmer says. "I think it will be a while until there is a creative catch-up with the data and we see that perfect, sweet combination of content that touches as many people as possible playing simultaneously, without cannibalization with the same type of content.”

Movio operates in North America, Latin America, Europe, Middle East, Africa, Australia, New Zealand, China, and South East Asia. Last month the Vista Group unveiled a joint venture with WePiao, an affiliate of internet giant Tencent. WePiao’s smart phone ticketing app is embedded in the WeChat messaging app, which has more than 600 million monthly active users, mainly in China. The JV, of which Vista will own 40%, will have exclusive distribution rights to Vista’s software including Vista Cinema, Veezi, Movio, MACCS and Numero.

“It’s always been our ambition to work with third-party ticketing companies like WePiao to help the U.S. studios target Chinese customers,” Palmer says. “It gives the U.S. studios a window into China.”