The Dying Days of Hollywood
As you may have noticed, all of these summer blockbusters are owned and distributed by six media conglomerates. These companies have been around since the early 20th century and were THE major brands during the Golden Age of Hollywood. Unfortunately, while these movies are hot topics today, most of the media conglomerates that own them are not.
For example, the BAV database elucidates that the brand perception of Viacom (Paramount Pictures) and TimeWarner (Warner Bros) has dramatically deteriorated over the last few years.
In 2010, TimeWarner was in the top-right quadrant. This quadrant is very important. Brands residing above the 45 degrees line are considered brand leaders, which translates into premium pricing and higher margins. Anything below the line is slipping away from the leadership stature and towards erosion and possible demise, which leads to commoditization and decreased profits for brands. As you can see, both Viacom and TimeWarner have slipped below the 45 degrees line very quickly in the last four years.
A closer look at their brand pillars helps us to understand why this is happening.
Viacom and TimeWarner exhibit telltale signs of deteriorating brands as diagnosed by the brand asset valuator model. Both companies have failed to differentiate themselves in the over-saturated marketplace, causing people to no longer perceive these brands to be relevant in their lives. As a result, respect for and interest in the brands are lost. The only increasing pillar for these brands is knowledge, but unfortunately this usually indicates that people feel they already know the brand and don’t want or care to know anything more about them.
While this deterioration has been fairly dramatic in recent years, the fall of the Big Six, has been happening for some time. Realizing that nothing had changed in the film industry for tens of years and feeling restricted by the corporate infrastructures and dearth of creative outlets, independent filmmakers started to challenge the system, but it was very difficult for them to get requisite funding and garner adequate attention.
Kickstarter and The Sundance Film Festival are two very strong brands today that are helping to solve those problems and drastically changing the landscape of the film industry as we know it. Kickstarter was launched in 2009 and allows people to crowd-source funding for projects they are working on. It was recently used to fully-fund Zach Braff’s film Wish I Was Here, which opens in theaters on July 18th, making it one of the first-ever crowd-sourced films.
But once a film is completed and has funding, how can it turn a profit and ignite buzz without having to sellout to the Big Six? That is where The Sundance Film Festival came into play. Founded in 1978, the premise of the Sundance Film Festival was to increase filmmaking in Utah and to give independent filmmakers a chance to make it big. Major directors like Quentin Tarantino, Steven Soderbergh, and Darren Aronofsky all got their lucky breaks through Sundance. The Signal, a film by William Eubanks, recently opened in theaters (June 8th) and was a top contender at Sundance this year.
As you can see, both the Sundance and Kickstarter brands are highly differentiated, which is the engine behind successful brands. They bring a fresh, new approach to filmmaking and have strengthened the independent film movement. The unique films that have been produced using these alternate financing and distribution models have allowed smaller distribution companies such as Lionsgate Films (founded in 1997) and The Weinstein Company (founded in 2005) to compete and even succeed in the industry.
In 2012, Lionsgate surpassed Paramount Pictures and 20th Century Fox in both gross earnings and market share, symbolizing the official breakup of the Big Six dynasty. If the Big Six wish to regain market share and increase their earnings, they cannot rest upon their laurels any longer. They will need to reexamine their brand image, reenergize their brand, and reignite consumers’ curiosity.
This all goes to show that in the competitive world of brands, no matter how golden your glory days were, your image can tarnish and you constantly need to burnish it to remain successful.