…and no, you don’t need 120 million dollars.
– by David Freedman
Once upon a time, cartoons were just for kids. To go without a kid in tow was considered odd. Once, or perhaps twice a year, Disney (and a very occasional other) would put out a feature film, and parents would happily send their kids off to the theatre, while they shopped for a new lawnmower or dashed home for a quickie. And many parents of younger kids would join their sprogs under duress.
Yes, once upon a time it was embarrassing for an adult to admit they actually enjoyed a cartoon. Disney knew that adults had to be entertained as well, and would promote the pics for ‘Kids of all ages.’ which gave permission to the adult, that guilty pleasure of going along with their kids.
But guess what? Those kids grew up, and thanks to Disney, most grew up with a soft spot for animation. And surprise… they had kids and grandkids of their own and without so much a whiff of embarrassment, and in fact with an excited glee, most parents willingly join their kids to see the latest Disney, Pixar, Dreamworks, Universal, Sony, Blue Sky, and many independent animations. We’ve come a long way from just two Disney films per year.
Crowded marketplace? Yes, and also no. As long as the product is good, the appetite and the numbers remain bullish. And not just for the giant studios with their megabuck films. Look at the breakthrough success of low and lower budget films like Nutjob, Freebirds, The Pirates, Boxtrolls, Kubo and the Two Strings… and ahem, Sausage Party (currently over $140 million at the box office).
There is a market for even lower budget pre-school films, which don’t have much family appeal, but they hit a far lower box office because they’re limited to matinee movie hours. The core market, is family films… the ones that appeal equally to kids, both girls, and boys, their parents, and yes… their grandparents.
Thanks to vast leaps in technology, tax breaks and did we mention the technology … the cost of producing animation is coming down. Way down. Most at Pixar would rather you not know that, but it’s true, and the independents are making huge inroads into a very hungry market at a fraction of the cost.
Bottom line, you no longer need to spend 150 million dollars. Ideally, 40 million can give you the level of quality in writing, spectacle on screen, and enough Star talent on voices to get a big USA sale, which is needed to knock through $100 million at the box office, but some have done it for under 20 million.
Now, let’s be clear. A cinema ticket costs the same whether you’re about to see the next Disney film, or an independent. And nobody in the history of this planet has ever gone into a cinema saying, ‘Let’s go see the bargain film.’ They don’t care what it cost. They only care that it’s good. Or that it might be good. Or different. Different enough.
So these independents have to operate on the Sneaky Baboon theory. Nobody else calls it this. Just me. You see, I was watching one of those David Attenborough documentaries, and he was showing how the dominant male baboons are big, noisy, strong, fierce and proud. A bit like Disney back in the 1980’s. This baboon dominates a vast harem, and it fights off any other big noisy strong baboons who try to enter their turf and take over. The other baboons try to beat the big guy, by shouting. They may not win a fight, but they try being far noisier and wilder. It reminded me of Dreamworks, Universal and Sony. And then Mr Attenborough focussed on the independent sector, showing how on the side, there are smaller, less powerful baboons who still manage a decent market share… so to speak. He termed them ‘sneaky baboons’. They are small, yet agile and smart. When the big baboons are fighting it out, the sneaky baboons would sneak in along the edges and woo members of the harem with good humour (Yes, it seems funny is money even in the wild kingdom) and gentle loving. And many in the harem loved this approach… and would look forward to visits so they could steal off for secret tristes. That sneaky baboon still delivers and not everyone likes a big noisy baboon all the time.
So, does your animated film need to be a big noisy visual overload with an all star cast? No. Animation is by it’s very technique magic, but yes, it needs to have some spectacle, and it needs a partial star cast to nail that USA distribution! Does it need a giant marketing spend with Subway and Burger King giving away toys? No, but it does needs a clever marketing spend, a damn fine trailer, with a lot of PR, to kick up word of mouth. Thankfully someone invented the internet!
Some recent sneaky baboons include, Nutjob, Freebirds, Alvin & The Chipmunks, The Pirates, Boxtrolls, Kubo and the Two Strings. And even smaller and sneakier, but extremely successful by their own profit margins, Khumba, Oops Noah Is Gone, Miniscule, Ernest & Celestine.
Ok, enough monkey love. Let’s get to some hard facts.
- Live action films date. Cartoons don’t. Animation consistently has the longest shelf life.
- Live action films are tricky to dub, and never quite convincingly. Whereas animation dubs brilliantly and instantly feels localized.
- Animation is a technique, not a genre… and the appetite for the technique grows every day, with animation year on year consistently making up for ¼ of all box office revenue.
We are clearly in a golden age for animated movies. Great news if you are a kid, even better news if you are investing in the genre.
Since Toy Story was released in 1995, animated films have generated more than $21bn in revenue in the US. In that period, four animated films have been the year’s top-grossing film.
According to an article on Bloomberg, “animated films offer the largest risk/reward equation in the movie business. It’s the most profitable movie genre, averaging a 36% return over the past decade.” Sci-fi and fantasy trail in second place with a profit margin of 26%. And let’s face it, lately those films have been an inch away from full animation.
The technology behind the latest animated films grows ever more sophisticated, and indeed that is part of their appeal. Just look at every single blade of grass flowing in the wind in Brave! Look at her flaming red hair! Every follicle! Wow! And did you see that water in Moana?!! That’s not cheap. Neither are the A-list actors US audiences demand as the voices of the animated characters.
And here lies one reason why producers hesitate before venturing down the animation route. Successes win big, but flops crash hard. When you’re spending over 100 million on a film, plus marketing, it needs to hit close to a billion to make it’s money back. In 2013, DreamWorks took a write down of $87m on Rise of the Guardians and $57m on Mr. Peabody and Sherman. Even Pixar hit a loss with The Good Dinosaur.
That said, the potential rewards are too hard for producers to ignore. Animated films generated more than $1.3bn in 2015 and accounted for almost 12% of the US market. And an analysis of more than 1,700 animated releases since 1980 shows that the average animated film earns $58m at the box office alone. On top of this, they can generate significant revenue through add-on merchandising; toys, clothes, soundtrack albums, etc. Even The Gruffalo has a touring live theatre show! Walt Disney’s Frozen has taken $1.3bn in worldwide ticket sales but an estimated $6bn in spin-off income.
Bottom line, animation is the one area that lends itself best to the broadest appeal. Don’t invest in a film that’s for kid’s only. The smart money is four quadrant; Male and female. Young and old. Animation draws large family audiences, and repeated viewings. When a kid likes a cartoon, they want to see it over and over and OVER!
As Walt Disney realised long ago: “You’re dead if you aim only for kids. Adults are only kids grown up, anyway.” Nothing wrong with Disney. Not at all. The company is genius, and we do adore that big baboon, we just like skirting around the edges… smaller, more agile, and sharing in a nice bit of that market share.