volume vs. values3-us-west-2.amazonaws.com/filmmarketingfridayspdf/film+marketi… · 7,246,597...

Volume vs. Value● Digital Sales● Volume?● Need to have a lot of transactions to make a profit● Hollywood can play the volume game

Success on VOD?● Digital copies range from $9.99 - $19.99● Digital rentals range from $0.99 - $4.99● Earning $100,000 on VOD is considered a success● How many transactions are required to be a success?● 5,000 transactions for digital copies● 25,000 - 100,000 transactions for digital rentals

Reality Bites ...● 25,000 transactions doesn’t seem like a stretch for

Hollywood studios …● But what about the über indie filmmaker?● The film without any “stars” or distribution?● Can these über indie films generate 25,000

transactions?● Even if you did generate 25,000 transactions, does

earning $50,000-$100,000 in revenue match your expectations in profits?

Reality Bites Even Harder ...● Most indie films selling on VOD are only generating

about 500-1,000 transactions● Average earnings are about $1,000-$5,000● Why make a film for $50,000-$200,000 if your VOD

earnings average $1,000-$5,000?

Starbucks Coffee ...● $3.00 per coffee● 4 Million cups sold per day● Revenue = $12,000,000 per day● Cost to make a cup of coffee = $2.00● Repeat customers

Movie Product ...● $3.00 per rental● 500 overall rentals● Revenue = $1,500 overall● Cost to make film = $250,000● One-off; No repeat customers

Value NOT Volume● If über indie filmmakers are only generating 500-1,000

transactions per film …● Why sell it for $3.00?● Indie filmmakers can’t compete in the volume game● Compete in the “value” game● But how?

The $100 Film Product● If über indie filmmakers are only generating 500-1,000

transactions in digital sales …● Then increase the price from $3 to $100● $100 X 1,000 transactions = $100,000● But what sort of film product is worth $100?

1,000 True Fans● Kevin Kelly’s famous blog 1,000 True Fans● Your film is an advertisement for something bigger ...● The audience you target will tell you what is worth $100

to them ...● You only need to provide $100 value to 1,000 interested

fans ...

Fat, Sick, and Nearly Dead

Michelle Phan

Michelle Phan● 7,246,597 YouTube Subscribers● 1% engagement● 72,465 active subscribers● $10/month beauty care package● $10 x 72,465 = $724,650/month● $8,695,800 annually● $84 Million valuation (source)

Napoleon Dynamite

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