Filmmaking Stuff Filmmaking Stuff provides resources for independent filmmakers. The website includes articles on how to take a story idea from script to screen, including articles on scriptwriting, producing, finance, shooting, editing, directing, marketing, distribution and how to build an audience. Filmmaking Stuff also has articles detailing how to make money making movies – including interviews with Hollywood Producers, Directors, writers and other filmmaking professionals.

Learning how to manage money is one of the most important traits of an independent filmmaker. Because many filmmakers are focused on a big Hollywood payday, they have decided to live paycheck to paycheck, shackled by high debt.

If you’re that person right now, you’re not alone.

It wasn’t too long ago that I lived with no savings and thousands of dollars in debt. I had no idea how to turn myself around. Luckily, I met some very successful people who set me straight.

They told me about “FU money.”

In Hollywood, when you get a bunch of money in the bank, it’s called FU money. You know you have FU money when you can enter into negotiations and walk out of the deal without the fear of starvation.

The most valuable success strategy for acquiring FU money is: “Pay Yourself First.”

When I first heard this concept, I had no idea what the heck people were talking about. But after meeting with some power players, I realized the idea is simple. Whenever you get a paycheck, before you pay any bills or fill up your gas tank, set a little money aside and never touch it. That’s all you gotta do.

I know. I know. Most independent filmmakers want to save money but feel too strapped to take action. This is because each month is filled with bills and other unexpected expenses. For this reason, most people put off saving until the end of the month. The problem is, by that time, there is nothing left to save.

And please let me remind you, as a general disclaimer, since I’m a filmmaker and not a qualified legal, tax or financial professional, even if the following strategy provided me with a bunch of FU money, this stuff may not be right for you. So, please talk to a qualified professional first.

One day, I decided to follow a successful friend’s advice. And while it took me a long time, I eventually dug myself out of debt and lifted that financial weight off my back. Here is what I did:

1. I wrote down all monthly income, including paycheck, extra jobs, etc.
2. I wrote down all monthly expenses, including bills, groceries, gas, etc.
3. I subtracted the expenses from the income.
4. I had some money left, so I figured out how much to save.
5. I opened a high-interest online savings account.
6. I set up automatic withdraws each payday and pretended it was a bill.
7. No matter what, for one year I didn’t touch the money!
8. After one year, I paid off my credit card debt.
9. After another year, I spoke to a financial adviser and started investing.
10. After another year, I built up an emergency fund.

After saving, I not only had enough money to get out of debt, I had also developed the valuable life-long habit of always paying myself first. FU!

Learning how to manage your own money will give you confidence when you begin managing your movie projects. Thankfully, there are many financial software programs and online services to help you stay on top of your finances.

Since 2001 (when I was making about 10K a year – I wish I was kidding), I have been using one of the popular accounting software programs. Since that time, I have migrated into the free version of Quicken online. Other friends use Yodlee. And some of my other friends still use a spreadsheet. All of these programs will give you a daily snapshot of your net worth, your spending habits, your bank accounts and your credit card accounts. Most will also chart your investment activity. Some of the more advanced programs allow you to work out a budget and offer debt elimination tools.

The reason why becoming a good money manger is essential to filmmaking is because most prospective investors will sense how you feel about money.

If you liked this sort of unique filmmaking advice, you’ll love the independent producers guide to movie finance.

 

Posted under FILM FINANCING

For Los Angeles based fimmakers looking to take their show to business, I recommend checking out the next  Norman Berns workshop.  In this full-day, hands-on instruction, you will gain experience on the following:

MATCHING SCRIPT and BUDGET – SCHEDULING – BUDGETING

BUSINESS PLANS – PITCHING – FUNDRAISING

DEVELOPING THE DECK

MARKETING – DISTRIBUTION – SALES

Your day will begin with an overview of the basics. Then you’ll spend A FULL DAY working with YOUR script, YOUR schedule, YOUR plan, YOUR pitch. You’ll gain valuable insight needed to dissect the logic of a shooting schedule, review production budget cost savings and craft business plans to meet investors needs. And you’ll also discover how to allocate state film incentives correctly.

Oh. And as a highlight, I’m going to stop by and share some tips on how to market and sell your movie without the middleman. I’m told this one day event is filling up fast. So reserve your spot.

When: Monday, May 9th

Where: Showbiz Software Store

500 S. Sepulveda, Los Angeles

9am – 6pm

Posted under FILMMAKING

If I could go back and talk to myself ten years ago… And if I could only share one filmmaking success tip, what would I say?

In two words: Cold Calling.

I know this may sound unrelated to filmmaking. But I can tell you that success is not created in a vacuum. It is created with the help and support of other people, including mentors and customers.

And while it is true that some people stumble upon contacts and get lucky, I would venture to say that over 90 percent of self-made successful people got what they wanted in life by utilizing some variation of the following three success tips:

First: They knew what they wanted.

Second: They made a plan to get what they wanted.

Third: They picked up the phone and cold called people who could help make their plan a reality.

Think about it. Could you go to “networking events” and try to find folks to help introduce you to the appropriate contact? Yes. But just as easily you could pick up the phone, call your prospective contact’s place of business and try to get him or her on the phone to make your pitch.

Will you get through? Maybe. Maybe not. But if you had a list of 100 prospects and you called all the people on that list, odds are good you would find someone willing to sit down with you.

Why is this important to your filmmaking? Because unless you ASK for what you want, how is anybody in life going to know how to find you?

If you would like to find out more about networking, success strategies and most importantly – how to find prospective investors for your next movie, you might want to check out the independent producer’s guide to getting movie money. You can find out more by clicking here  >>

Posted under FILM FINANCING

As a feature filmmaker, it is important to maintain positive thinking and keep your fingers crossed for a great distribution deal. But the reality is – the movie industry is changing. New methods of distribution including Video On Demand and internet viewing continually erodes traditional sales channels.

Good news and bad news: The good news is, you now have one of the most amazing opportunities in movie making history to make a movie, reach your audience (globally) and collect cash.

And here is the not so good news.

In order to benefit as a modern moviemaker, you will have to become masterful at creating buzz, establishing and maintaining a sales funnel website, while simultaneously focusing on increasing your targeted web traffic and converting your visitors into a paying audience… Only then can you create a profit and possibly pay back your investors.

And despite this reality, many filmmakers will still waste time waiting for someone else to “discover” their project.

.

Posted under DISTRIBUTION

Have you ever wondered how filmmakers raise money for their movie business?

Last week (while back east for the holidays), I set up a meeting with a very successful businessman (who I met in 2004). My goal was to pitch him my current business idea.

Here are the steps I took to set up the meeting and make the pitch:

1. I emailed and asked for a meeting to discuss an “interesting business idea.”
2. Then I got a response. We scheduled the meeting.
3. Prior to the meeting, I worked liked crazy to refine a PowerPoint presentation. The PowerPoint followed a standard business plan outline. Once complete, I acted out the presentation about a dozen times. I also visualized how the meeting would go. And I also created and answered sample questions.
4. On the morning of the meeting, I dressed to impress. In my car, on the drive there, I rehearsed the meeting. (Yes. I talked to myself). I also prepared a printed copy of the presentation and created a Plan-B just in case the projector malfunctioned.
5. When I got to the meeting, I requested that their IT person help me set up the projector. Then I flipped through each slide to made sure the overhead projector worked.
6. When the decision maker arrived, I gave a firm handshake and we exchanged some friendly conversation. I asked a lot of questions about his current business.  (As an entrepreneurial filmmaker, you must always consider your audience. If your prospective investor manufactures widgets, you should know about his business and then find ways to bend your pitch so that your project may benefit his core business.)
7. I then began the PowerPoint. I presented each slide with enthusiasm.
8. After the presentation, the prospective investor had questions. (Questions equal interest. Lack of questions equal lack of interest.) Here are some questions: How will this project garner ROI (return on investment)? How long will it take to get the money back? What multiple will this investment potentially return? (If your business idea can not garner a higher return than  a savings account, why do business at all?)
9. After questions were answered, I ASKED what he would need to move forward. He mentioned that he would need to see how the money would be spent and exactly how I plan on returning it. (I provided a basic overview in my slides, but he wanted more granular detail.)
10. I told him I would circle back with more details and provide him with a copy of the business plan.

Some of you may ask why I didn’t take my refined business plan to the meeting. The reason is, getting money for a movie is not the same as selling a car. Since we are talking about a long term business and a lot of other people’s money,  I first wanted to gauge his level of interest and see if we could build rapport. I also wanted to find his red flags. And I also wanted to keep him wanting more…

I will address all of his points in the business plan and circle back for the next meeting. I will also ask him if he would kindly introduce me to some of his successful friends.

Why do I share this?

FIRST: Assuming you have met with a lawyer and figured out a way to protect yourself legally -This is important – then here is my question:

If you aren’t afraid to hear the word “NO,” then what is stopping you from setting up a meeting and presenting your ideas to prospective investors?

It doesn’t always mean you’ll get the money (if it were easy, everybody would do it.) – but it does mean that every NO is one no closer to YES!

If you want to find out more about my system for meeting prospective movie investors, check out The Independent Producer’s Guide To Financing Your Movie.

Posted under FILM FINANCING

A few weeks back, I came to the realization that selling movies on the internet was no different than any other kind of eCommerce. So using the same forumlas I utilize to market my Action Packs, I plugged some numbers into an internet marketing ROI calculator.

I did this because the prospective investors in my life often ask how their money will be spent and recouped. Given the discriminatory nature of traditional distribution, I wanted to see what it would take to make internet distribution a viable sales channel. So I started crunching numbers with one assumption – if filmmakers can make the numbers work for each project, filmmakers would no longer have to rely on the glaringly flawed: “Gee, I sure hope we get into a film festival and garner a great deal” distribution strategy.

That strategy is a lottery. Not an investment. And it’s outdated.

So I got down to business and crunched some numbers. To my delight, I found some answers – but after publishing my article on internet movie distribution, many people kindly wrote to tell me that my numbers are incredibly unrealistic (and that is putting it nicely.) And I totally agree.

Looking at my results, it became quite clear that recouping even a measly 1M dollar budget by selling $20 dollar DVD’s in Amazon, relying solely on Pay Per Visit advertising  at  $.05 cents a visit, while, at the same time crossing our fingers for a 1% conversion would require that, firstly – you would need to sell 100,000 units (which allows for a 50% marketplace fee). And secondly, assuming a 1% sales conversion, to get these numbers, you would need 10,000,000 site visitors, visiting your website. (Yes, ten Million people) – which WE ALL AGREE is outlandish!

But in all of the debate, despite the negative responses, and the haters who took special care in hating me, and the seasoned producers who took meticulous care in ignoring the math and instead, decided to point out my spelling mistakes and poor use of grammar – Despite all the backlash – very few people (OK, pretty much nobody) even tried to offer a better solution.

So I decided to provide YOU with the chance to save the independent movie industry. If YOU can answer the following questions, you will help push indie filmmaking into the next era. In fact, YOU will help us make indie filmmaking a profitable business.

Are you ready to change the world of independent filmmaking forever – for the better? Here is your chance!

Here are the MAJOR Filmmaking Math Problems:

1. With no promise of a traditional distribution deal, how do filmmakers justify a budget large enough to pay freelance day rates, while at the same time project enough direct DVD and VOD sales to recoup the initial investment?
   
2. And assuming only 1% of your website visitors buy your movie, then how many people must visit your website so that 1% recoups your initial investment? (Don’t forget to include marketplace costs.)
   
3. How much will this cost in advertising?
   

The Formula:

To possibly help you,  I provide my formula (below) in hopes someone with more math experience can test and tweak until this starts to make sense. Here is what I have so far:

Movie Internet Marketing Formula

U = Unit Sales Goal.
A = Amount you pay advertiser per website visit.
C = Projected conversion percentage rate.
X = Number of Visitors Needed.

(X)C = U
EQUATES TO: X= ?
THEN:  X(A) = ?

–>Thank you. Please click here if you would like to comment or offer your own formula and results for the world to see!

Posted under DISTRIBUTION, FILM FINANCING

As we get closer to an independent filmmaking business driven by video on demand distribution, I am on the hunt for various case studies that can help filmmakers navigate the changing world.

I caught wind of an indie production company based in Australia called Rapidfire Productions. This is a production company that operates as a self sustaining modern moviemaking business. They develop, produce and distribute their genre specific titles through their own distribution arm. David W. Allen is one of the producers. Earlier this week he stopped by Filmmaking Stuff to share some ideas on how to make, market and sell movies through new forms of internet distribution.

Jason Brubaker
What is your name?

David W. Allen
David W. Allen

Jason Brubaker
How did you get started making movies?

David W. Allen
I have always been into making movies with my long time best friend and director of our most recent feature, “The Gates of Hell,” Kelly Dolen. As kids in our early teens we would always be running around with a video camera making home movies and writing our own horror and action screenplays.

Jason Brubaker
And then when you felt ready, you made the shift to features?

David W. Allen
Yes. Our first feature length film was a low low budget vampire flick called ‘Reign in Darkness’ which we both wrote and directed. We only had $49k to make this with and considering the budget it came out okay.

Jason Brubaker
Sounds like an exciting first feature.

David W. Allen
We jumped on a plane to LA wide eyed and innocent to sell our film and make it big in Hollywood.

Jason Brubaker
I felt the same way after our first feature. It’s like you work so hard to make the impossible, possible. Hollywood sure seems like the logical next step.

David W. Allen
Ahhhh how naive we were all those years ago. [Laughter]

Jason Brubaker
So what happened? Were you able to sell the movie for an amazing cash advance and get a 3 picture deal?

David W. Allen
We ended up getting a distribution deal with a sales agent who we were introduced to by an entertainment lawyer.

Jason Brubaker
Was it a good deal?

David W. Allen
No. We got ripped off and didn’t see a great deal of money for the film. That was 10 years ago. Today the title is still selling out there, online. The movie is making money for other people but not us.

Jason Brubaker
How did that change your perspective about traditional distribution?

David W. Allen
I learned a very valuable lesson with ‘Reign’ and vowed if we ever made another feature film we would distribute ourselves.

Jason Brubaker
I agree with you. Especially when it comes to video on demand distribution.

David W. Allen
I could see where the Internet was heading and knew it was going to be the way to reach our future audiences with our Independent films.

Jason Brubaker
What is Rapidfire Productions?

David W. Allen
Rapidifire Productions was established by Kelly Dolen and myself in 1999 with the sole purposed to produce a diverse, wide range of Independent high concept genre films, ranging from action, drama, horror and sci-fi.

Jason Brubaker
So you are staying very genre specific?

David W. Allen
Our long-term goal was to make commercially successful projects that satisfy a marketplace craving for intelligent genre films and build a distribution arm for low budget Indy films.

Jason Brubaker
And it sounds like your title called “The Gates Of Hell” fits your model. Tell us about the project.

David W. Allen
The Gates of Hell is a dark psychological thriller and horror flick which is inspired by a combination of “old school” films like The Exorcist and The Thing and the adrenalin of cutting edge video games like Gears of War and Manhunt.

Jason Brubaker
Could you tell our readers where to find out more about your movie?

David W. Allen
Here is the website: www.TheGatesOfHellMovie.com

Jason Brubaker
How did you come up with the idea?

David W. Allen
It was back when Kelly and I were sharing a place together and we were talking about what we can make next for a low cost and high commercial value. We were talking about a filmmaking seminar we attended in Melbourne, Australia conducted by Dov Simmens, a Hollywood indy filmmaking guru.

Jason Brubaker
I am familiar with Dov and his work. What was the most inspiring advice he gave you?

David W. Allen
He said the best thing to do with your first film is to get a bunch of young people and take them to a single location and chop them up.

Jason Brubaker
Ha! I think that is sound filmmaking business advice.

David W. Allen
That was the thought process that ignited the idea for The Gates of Hell.

Jason Brubaker
So once you had your idea, what came next?

David W. Allen
Kelly and I started brainstorming ideas and we come up with an old condemned orphanage that used to house discarded deformed children that upper class people didn’t want.

Jason Brubaker
That sounds like a true horror movie.

David W. Allen
We researched this online to see if in fact a place like this did exist and they did back in the early 1940’s. And then we added some Hollywood to the idea and the first treatment was written.

Jason Brubaker
So once you had the treatment, what came next in your process?

David W. Allen
From there Kelly ran with the idea and developed it into a screenplay which was constantly developed over some years to get it to a stage where it was ready to make. We had a local artist drawing characters for the film and story boards you name it was all happening.

Jason Brubaker
What was your role during this time?

David W. Allen
I focused on the producing and marketing. I was responsible for developing an internet marketing strategy, building the website and creating the entire online distribution business model. I planned an online release from the very beginning.

Jason Brubaker
Building your movie business plan based on an internet marketing strategy is a very new concept. Was there any pushback from other producers or investors?

David W. Allen
The Investors had no intention of going down this path. They wanted the big blue sky and Hollywood. But I knew in the end they would end up going with my plan to self-distribute.

Jason Brubaker
What was Kelly’s role?

David W. Allen
Kelly went out and raised the large majority of the money from investors of our previous film and the new investors came from people he knew from his years selling home audio equipment at the large retailer JB HI-FI. The main investors were customers of Kelly’s from this store and over the years they come to value him as a friend more than just a shop assistant.

Jason Brubaker
So would you say that filmmakers must first understand the value of relationships?

David W. Allen
There is such a valuable lesson to be learned here especially with the social networking explosion on the Internet… Success is all about the relationships both online and offline.

Jason Brubaker
That makes me remember a quote I learned while selling overpriced hot tubs in college. “People buy from people they trust and like.”

David W. Allen
In my opinion this is the key to being successful in offline and online business and film distribution. Over time your followers will come to trust you and believe you, so when you have something to sell they will be far more likely to buy because they feel like they know and trust you.

Jason Brubaker
So let’s talk more about your movie sales strategy. How did you handle the sales, marketing and distribution?

David W. Allen
After the film was completed we took the film to a number of film festivals such as Screamfest, Amberg, Sacramento, and NYC. We also attended some film markets such as AFM and Cannes.

Jason Brubaker
Were you able to gain any traction?

David W. Allen
The film had great reviews but with all the positive hype around the the film the distribution deals were not very favorable and we didn’t want to go down the same path as we did with our first film ‘Reign in Darkness’ where were got a raw distribution deal.

Jason Brubaker
That is a tough choice. Many first time feature filmmakers will consider deals that do not pay a dime, just for the validation that comes from someone else saying “Great work! You’re a REAL filmmaker!”

David W. Allen
Yeah. But being passionate about everything Internet, I was pushing the proposal of just self-distributing online. But it was a hard sell to our investors who wanted to see the film in cinemas and up in lights.

Jason Brubaker
That is interesting. I guess some of those folks need traditional validation too?

David W. Allen
Well, all I wanted was to see a positive net return for sales of the film and focus on introducing the film to its market online and letting its popularity spread over time.

Jason Brubaker
Sounds like a pragmatic approach to your modern movie business. Were you able to get your way?

David W. Allen
I managed to get my way in the end with a little compromise. The investors wanted to see the movie in the cinemas so we did a distribution deal with an Australian distributor for Australian and New Zealand rights.

Jason Brubaker
Sounds like a hybrid deal. You retain some rights, while licensing other rights through other channels. Was this a profitable strategy for your movie?

David W. Allen
As I am writing this, the distributor is still yet to do anything with ‘The Gates of Hell’, which is no surprise to me, but a big lesson for the investors who wanted a quick return and blue sky.

Jason Brubaker
At least you can move forward with your own internet movie marketing strategy. Can you tell us a little more about your marketing plan?

David W. Allen
My marketing plan is simple. With very little money, I am taking the advice of a brilliant marketer Seth Godin and build a tribe and sell the movie to that tribe who over time will spread the word.

Jason Brubaker
What are the mechanics involved in building a tribe?

David W. Allen
I will be collecting emails from prospective customers so we can sell them backend products that they actually want.

Jason Brubaker
What about marketplaces? Where will you actually sell your movie?

David W. Allen
My distribution plan is to start off with selling the DVD then when I get some traction in the market I will approach a VOD distributor and then an iTunes aggregator and Amazon. I will also look at Netflix but I will wait until it gets more popularity so to get a better upfront fee.

Jason Brubaker
You mentioned DVD. Who is going to handle your DVD fulfillment?

David W. Allen
For the DVD distribution I use a company called Disk.com. They were highly recommended to me by some of my Internet marketing peers who use them to create and distribute their information products. They are based in the USA and is a great place for the shipping of the DVDs within the US and throughout Europe and the UK. There are some great companies here in Australia but the shipping costs would be way too high given our main market is in the USA and UK.

Jason Brubaker
Outside of distribution and your website, how are you spreading word of mouth?

David W. Allen
Facebook Pages and Twitter play a bit part in my strategy. I use these platforms to build what is called Market Leadership. I also hit the forums and get involved in the top ones and this is a great way to get people to check out the film.

Jason Brubaker
What about getting prominent website owners to review the movie?

David W. Allen
I am sending out copies to influences in the market place, people who already have a large following in the horror market and if they like the film they will tell their tribe about it.

Jason Brubaker
When I first saw your movie website, I was impressed. I think it has all the components necessary to create a movie sales funnel. But you also have something called an opt-in box to build your mailing list. How important is a mailing list for modern moviemakers?

David W. Allen
Very important! It is such a valuable asset for filmmaker if they don’t abuse it. It takes so long to build traffic to your website so you want to be capturing as many leads as possible so you can stay in touch with them, send them cool free stuff and then sell them backend products related to their film.

Jason Brubaker
Yes. I think filmmakers need to take charge of sourcing their own core audience. But what about in-between projects? How do you leverage your list?

David W. Allen
Between projects, the other thing filmmakers can do is introduce other people’s related products to their list for a fee or on an affiliate basis. Over time your mailing list will become very valuable. The bigger and more responsive the list, the more other industry players will want to pay filmmakers money to get related products or films in front of their subscribers.

Jason Brubaker
What suggestions do you have for other filmmakers who want to create their own movie business?

David W. Allen
Look at the market you’re making the film for first. This is a business and if you are going to spend money on making a film you better be sure there is a big enough and hungry enough market out there to buy your film and other backend products.

Jason Brubaker
You keep mentioning marketing related products. Could you explain this a little more?

David W. Allen
I look at the film itself as a lead generation product for the purpose of building a big list. I am not all that concerned about making the money back on the DVD itself but on other monetizing avenues over time including advertising.

Jason Brubaker
That is an interesting concept. Most filmmakers do not think like marketers. Yet if we want to make money making movies, it makes sense that we would need to diversify our product offerings.

David W. Allen
The modern filmmaker needs to think beyond the film itself as the only means of generating income. The money online is where the eyeballs are. Think about it.

- – -

To find out more about Rapidfire Productions and their titles, GO HERE

Posted under DISTRIBUTION, INTERVIEWS

One of the most important filmmaking strategies you must adopt in this era of modern moviemaking is a long term perspective. In years past, filmmakers focused on making one movie, selling it and then moving on to the next movie.

While the idea of creating multiple titles over the course of your filmmaking career has not changed, it is now vitally important that you plan a series of movies from day one. The reason for this is simple. You are now solely responsible for the success of your movie business. And to stay in business, you will need to create a profitable library of titles that continually pay you.

To use a real estate business analogy, in years past you built a house and sold it for maximum profit. But these days, given the changes in the real estate market, it makes sense to hold onto the house, rent it out and collect rent checks every month. This is the difference between capital gains and cashflow. And as an independent filmmaker, the growing demise in DVD sales outlets means that filmmakers must now focus on creating multiple titles – and increasing cashflow, over time.

Step 7 – Leverage Your Following.

As I mentioned previously, creating a highly targeted mailing list is now essential for your success.

Thinking long term, the most important component of your movie making success is establishing a loyal following. From a business perspective, the size of your mailing list will provide a solid metric on which to base forward looking revenue projections. In other words, you can take look at your list and say “two percent of our followers bought this movie. I wonder how many fans will be interested in my next movie?” But instead of guess work, you can send your followers an email and ask them.

As you grow your community your fans will begin to know you, know your company and celebrate your work. And as long as you continue to provide good entertainment, you may eventually reach mass great enough to fund your future movie projects. Imagine how much prospective investors will appreciate your pitch when you already have one-hundred-thousand fans eager to buy your next movie?

In the end, the heart and soul of all forms of distribution is finding an audience willing to pay you for your work. Video on demand simply removes the middle-man from the process and allows you to connect directly with the people who matter the most – your audience.

Posted under DISTRIBUTION

As a filmmaker, once you have a great screenplay and an initial break down and budget, your next step is to take your proposed budget and put it into a business plan. The business plan will help you determine how the money will be spent and hopefully recouped.

Independent movie investors invest because (aside from having an appetite for risk) they want a return on their money. Creating a business plan provides your prospective investors with a road map on how the investment dollars will be spent and hopefully recouped.

In the past, trying to project returns was a pain in the butt, oftentimes based on speculative data. This is mainly because independent movie distribution was discriminatory. And as a result, after production, many independent feature filmmakers held their breath in hopes their movies would get into a film festivals, build buzz, and (hopefully) garner awesome distribution deals, complete with cash advances.

Unfortunately those old business plans, focused on what is commonly referred to as the “Sundance Dream,” were flawed – And thankfully, that dream (or nightmare) is over.

Given the birth of VOD distribution, filmmakers now have the ability to access and enter into a non-discriminatory marketplace as soon as your movie is ready. As a result, you can now create movie sales projections from day one.

To get started, answer these questions:

Modern MovieMaking Model

1. Who Is Your Target Audience?
2. How Large Is Your Target Audience?
3. How Will You Reach Your Audience?
4. What Is Your Marketing Strategy?
5. How Many VOD Sales To Break Even?

While I won’t get into the actual mechanics of marketing and selling your movie here (My Action Guide How To Sell Your Movie provides you with an actual step-by-step plan for getting your movie seen and sold), I will simply note that a marketing plan must now be included with your business plan. And in that marketing plan, you’re going to add some marketing math.

Truth be told, math is a weak subject for me (and I dare say, most of the filmmakers I know) – but luckily there are many spreadsheet templates that allow you to project the marketing return on investment for your movie. One of the early formulas I use is related to pay per visit advertising.  With pay per visit advertising, you simply pay for targeted traffic to your movie website. This works well if you have a movie with a dose of controversy and a strong hook.

Let’s assume only 1% of the targeted folks who actually visit your website, buy. Then how many visits will you need to sell 100 units?

100 units = Our goal for this ad campaign.
$.05 = Amount you may pay advertiser per visit.
X = Number of Visitors Needed to buy 100 units if only 1% buy.

(X).01 = 100 units
EQUATES TO: X= 10,000
THEN 10,000($.05) = $500 paid for targeted traffic.

So in other words, if you were lucky enough to get a 1% return, you just paid $500 dollars in pay per visit advertising to sell 100 units of your movie. But let’s go one step further. Let’s assume you’re like me – and you hate order fulfillment and shipping. So you decide to let a company like Amazon’s Create Space or iTunes (or some other popular marketplace) handle your order.

Video On Demand For Rent
100 units ($3) = $300 – 50% paid to marketplace = $150
minus $500 paid for advertising = -$350 NEGATIVE

In this VOD rental scenario, the Pay Per Visit Ad numbers don’t work, unless you like losing money.

—
Video On Demand For Download
100 units ($10) = $1000 – 50% paid to marketplace = $500
minus $500 paid for advertising = BREAK EVEN

In this VOD download to own scenario, the numbers work a little bit better. Assuming you’re lucky enough to get 1% of your money returned, at least the advertising pays for itself. But unless you can increase profits, pay per visit advertising is going to be very difficult method for returning money to your investors.

—
Physical DVD Sales
100 units ($20) = $2000 – 50% paid to marketplace = $1000
minus $500 paid for advertising = $500 in profit.

Ah ha! If you’re fortunate enough to get 1% return on your pay per visit advertising, you can see how physical DVD’s sold at $20 dollars may offer a slight profit margin. In other words, in this scenario, for every $.50 cents you spend, you get $1 dollar back.

So let’s tackle the bigger problem. Let’s try to get a return on our 1Million dollar movie, selling physical DVD sales and using pay per visit advertising alone:

Movie Budget = 1 Million dollars
Physical DVD Sales using Pay Per Visit Advertising

$1,000,000 divided by $20 per unit = 50,000 Units

Since we will give 50% to the marketplace for all sales, we will need to project for double our budget.

100,000 units = Our goal for this ad campaign.
$.05 = Amount you may pay advertiser per visit.
X = Number of Visitors Needed to buy 100,000 units if only 1% buy.

(X).01 = 100,000 units
EQUATES TO: X= 10,000,000 (Yes, TEN MILLION people.)
THEN 10,000,000($.05) = $500,000 paid for targeted traffic.

100,000 units ($20) = $2,000,000 – 50% paid to marketplace = $1,000,000
minus $500,000 paid for advertising = $500,000 in profit.

So to break even, you would need to sell 100,000 units and make $2,000,000.

Filmmaking Conclusions

Based on this scenario, as a filmmaker you will (obviously) need to expand your promotion beyond pay-per-visit advertising!

But importantly – and most AWESOMELY -  for the first time in independent moviemaking history, you can now treat your movie business like any other small business. Find the marketing formula that works for your movie and crunch your numbers until they work. Once you have a plan, then simply include your marketing costs in your budget.

While there are no guarantees in any business, having a plan for marketing, sales and distribution sure beats the old days when your only plan for ROI involved crossing your fingers in the hopes someone will offer you a profitable, traditional deal. Treating your movie business like any small business simply means you don’t have to ask permission. You can make your movie NOW!

And your prospective investors might take notice…

- -

Can you do me a favor? If you liked this filmmaking article, could you kindly retweet or share it with your friends?

Posted under FILM FINANCING

Traditional independent filmmaking is changing. In years past, the independent movie business was defined by a filmmaker’s ability to find a script, locate movie investors, raise the necessary money, make the movie and (hopefully) land an awesome distribution deal – and then live happily ever after.

At least that was the dream.

But these days, the entire model of indie filmmaking has gone Topsy-Turvy. Nobody knows this better than Jon Reiss and Sheri Candler. Both are on the cutting edge of independent movie marketing and distribution.

Earlier this week, Sheri Candler and Jon Reiss stopped by Filmmaking Stuff to share some ideas on how filmmakers can think outside the box office. You can listen to the Podcast here:

Download This Filmmaking Stuff Podcast: <<Download Podcast>>

About Jon Reiss:

Jon Reiss has produced and directed three features films and has been named one of “10 Digital Directors to Watch” by Daily Variety. Based on his experience, Jon Reiss wrote “Think Outside the Box Office: The Ultimate Guide to Film Distribution in the Digital Era.” This book has gained international acclaim. Check out:  The Official Think Outside The Box Office website.

About Sheri Candler:

Sheri Candler is an inbound marketing strategist who helps independent filmmakers build identities for themselves and their films. Through the use of online tools such as social networking, podcasts, blogs, online media publications and radio, she assists filmmakers in building an engaged and robust online community for their work that can be used to monetize effectively. To find out more about Sheri Candler’s independent movie marketing services, visit her website here: Sheri Candler Movie Marketing website.

- – -

If you like this article, please click one of the boxes below:

Posted under DISTRIBUTION, INTERVIEWS