Industry Report: Distribution and exhibition
International Sales: the Role of Distribution Companies and Their Marketing Strategies
by Cartoon, the European Association of Animation Film
- What would be a typical model for co-financing a $50 million feature film? Catherine Winder (Winder Consulting): the strategy is very much a matter of negotiation. A typical model could be the following.
-Either Producer or Distributor fund development of concept/treatment for feature-length animated film.
-Producer and Distributor agree to make the film.
-Producer and Distributor each fund one half of production cost; $25 million each.
-Distributor pays all marketing and costs for releasing the film in theaters and on DVD/VHS.
-Distributor receives film rental income from movie theaters at an average of 50% of Domestic Box Office receipts and 40% of International Box Office receipts.
-Distributor receives revenue from the sales of DVD/VHS units and other ancillary exploitation. Distributor takes an ongoing distribution fee equal to a percentage of all revenue received from the theatrical release of the film, home DVD/VHS sales, and any other ancillary exploitation.
-Distributor recoups the amount it spent on marketing and releasing the film in theaters, DVD/VHS and in any other ancillary exploitation.
-Producer and Distributor recoup their separate $25 Million in film production costs.
-Producer and Distributor split 50-50 the remaining ongoing revenue from all sources after the studio takes its distribution fee and recoups any ongoing distribution costs.
How is structured the relationship between the producer and distributor in Europe?
Marc Bonny (film distribution company Gebeka):
the producer and a distributor have to clarify the parameters of the release: how many copies, how much money will be spent in publicity, how much will be the MG.
All these parameters will be detailed in the distribution mandate. An independent distributor can intervene in different moments of the film’s life.
Also the financial implication can be very different: between 30.000 euros and 1 million euros. The relationship with the producer is then very different. Several examples can illustrate each different situation.
The Little Polar Bear has been distributed in France by Gebeka once the film was already finished. We agreed with Warner to pay a MG and to invest 200.000 euros in marketing. We acquired only the theatrical right distribution. In France the distributor takes 25% to 30% of revenues from theatrical distribution.
Another example is Nounou 3 by Gary Bardine. Gebeka get involved in the film during the production process. We paid a MG and we acquired all the rights for France (theatrical, television and home video).
Another example is The Boy Who Wanted To Be a Bear. This film is a co-production between France and Denmark. In France the film is considered as a French film. This factor implies that the relationship with the distributor is not the same. Gebeka will be involved very soon, from the script stage.
Kirikou and the Beasts is another example. Gebeka is distributor and co-producer and will be involved in all the production process.
Who decides the release date?
Catherine Winder (Winder Consulting): In the US the distributor will have generally control on the creative process. As marketing costs are typically 50% of the production budget, the most important thing for the life of a film is the date of release. Several factors have to be taken into consideration such as target audience and how crowded is the marketplace. The studios are planning the release date one year in advance.
Marc Bonny (film distribution company Gebeka): in France we are very far from the US situation as we have much less financial resources. In Europe the producer has a global responsibility that goes far away from its normal competences. The producer needs a global communication strategy and has to work with different distributors in different countries. In animation we have a handicap to market the film: the absence of real actors. The communication strategy has then to be based on music, voices, visuals… European producers should preview a budget for marketing in their financial plan and should know how distribution works. Promotional material is the key element to set up a good marketing campaign. Very often European producers do not provide basic promotional material to the distributor, which of course is a big handicap in terms of marketing.
How should an independent animation film be marketed?
Didier Brunner (Les Armateurs): each case is different. For the Les Triplettes de Belleville (Belleville Rendez-vous) [+see also:
film profile] we worked with a very talented international distributor: Celluloid Dreams. The strategy has been to raise the curtain little by little, disclosing bits of the films and visuals, creating a desire to watch the movie.
Frank Gladstone (DreamWorks Animation): for independent US animation feature films the crucial factor is the date. It is hard to release an independent film. The market is limited: between 30 and 150 prints. That’s not like release 400 prints were studios buys blocks of theatres all aver the country. For an independent each release has to be negotiated on an individual basis. It can be difficult to find the theatres the producers want to go. Marketing through web sites is absolutely crucial especially for independents because audience is on the net. Web marketing is cheap and allows word of mouth promotion through the forums.
Cartoon, the European Association of Animation Film
Cartoon Master Munich, Germany, October 2004