The independently produced thriller “Paranormal Activity” cost about $10,000 to produce and has grossed approximately $68.2 million at the date of writing. It looks set to rival the feats of films like “The Blair Witch Project” and “My Big Fat Greek Wedding”. These tiny films grossed hundreds of millions of dollars at the box office.
A major contributing factor to its success? Viral marketing. This is the advertising of a film via word-of-mouth (emails, Twitter, Facebook etc).
The main focus of Paramount’s DreamWorks unit was on the use of social networks, such as Twitter, to generate interest in the film, as well as the use of more traditional advertising techniques. Paramount also initially released the film at inexpensive midnight screenings. The entire Paramount marketing campaign only cost approximately $10 million.
People who had seen the film (during its limited release) were asked to “Tweet Their Screams”, or write reviews on the film. Most of the reviews were good and as Twitter only allows reviews to be submitted that are no more than 140 characters long, it was difficult for people to adequately voice any reservations. This led to a larger limited release which was focused on one of the larger viewing demographics of movies of this type – the inhabitants of college towns.
Once this roll-out proved successful, Paramount then allowed Twitter users to ask for the film to be released in their town. This gave the people the power to demand where the film would be released next. Paramount also encouraged feedback via Twitter by advertising that if they received 1 million demands for the movie they would release it nationally.
This strategy proved highly successful and will no doubt be adopted by many other studios and marketing degree programs in the years to come. Such a marketing campaign is cheap and effective until it becomes overused.
What makes the success of this film even sweeter for Paramount is that the film was rejected by every studio and indie distributor in Hollywood, even getting a thumbs-down from the Sundance Film Festival.
Adam Goodman made room for “Paranormal Activity” on his release slate when he was appointed head of production at Paramount. A pretty good maneuver considering the turmoil that Paramount has been in lately.
Gene Goodsell is an entertainment agent. He focuses on film financing, packaging and aspects of production. He has numerous US and Australian clients. Gene has a business degree, law degree with honours and is currently studying for his Master of Laws in entertainment. He is a member of the Law Society of New South Wales, the Beverly Hills Bar Association and Independent Film Financing Alliance.
Gene:
Great article. Do you have any estimate of what percentage of the $10M marketing campaign was the viral/internet part?
Hard to see spending that much creating twitter traffic. Did Paramount hire a big team of Twitterers? Or did the Tweets get farmed out to established Twitter accounts (pay-for-tweet)? Really curious how they do this.
Thanks Jorge.
I imagine a large proportion of the $10m would have been devoted to traditional forms of marketing. I also suspect that pay-for-tweet would have been used.
Let me know if you have any luck discovering the mechanics of this.
I just read on SLASHDOT that the average budget for major, multi-platform video games is $18-28 million. How does this match up with the average cost of a Hollywood movie?