The 2006 numbers are in, and Hollywood has increased the percentage of its marketing budget that it spends online. Barely.
Hollywood studios, as tracked by the Motion Picture Association of America (MPAA), spent 3.7% of their media ad dollars on the Internet.
Movie marketing spending changes from year to year, especially when TV upfront spending spikes. Marketing costs also vary from studio to studio because each one releases a different number of films each year. That said, movie marketing costs were actually down on average in 2006, to $34.5 million per film.
There are a number of reasons why Hollywood spends a smaller portion of its ad dollars on the Internet than the US overall, which eMarketer estimated at 5.7% on average in 2006.
One reason is comfort with the traditional TV-heavy approach. Another is that some movie marketers tend to think they are spending more online than they are, by including unmeasured online creative production costs. eMarketer has talked with two movie marketers off the record who thought their Internet ad spending was generally about 6% of total ad spending — more than twice as high as the MPAA's reported 2.6% for 2005.
Given Hollywood's dependence on young moviegoers, who are its most reliable seat-fillers, online ad spending increases are inevitable. eMarketer estimates that the percentage of its media budget that Hollywood spends online will reach 8% by 2010.
Besides the ongoing push to get more demographic data from Websites to marketers, legal movie downloading services will help increase online movie ad spending. Movie marketers like to reach film fans while they're watching movies, as increasingly long pre-show ads prove. As such, Amazon Unbox, AppleTV and other downloading services will give them new verified targets for such marketing.
Get a comprehensive look at how movies are marketed online. Read eMarketer's Hollywood Online: Getting the Big Picture report.