What the Film Industry Could Learn from the Gaming Industry

6 06 2006

The video game industry may just be a baby in comparison to Hollywood, but one thing the gaming sector seems to do better is to create and then sustain buzz for its properties.

In 2004, Halo 2 launched to an eager videogaming audience. It generated $125 million in sales during the first day, an unprecedented amount of money for any entertainment field. This includes Hollywood, which (as is often pointed out) has complete box office results lower than the revenue generated by the interactive entertainment industry.

Comparisons don’t end at the fiscal end of things between games and movies. The labor situation in the gaming industry, with the lack of independent studios, is often described as “Hollywood in the ’30s.” And games themselves are often directly compared to movies as a storytelling medium.

But when it comes to advertising/promoting their respective properties, how much does the gaming industry have to learn from Hollywood? And perhaps even more to the point, how much can Hollywood learn from gaming? We talked to Joshua Kerr, founder and president of Ideal Science and Dan Rogers, senior partner ISM about the subject.

Networking of all sorts
During 2004 Halo 2 developer Bungie decided to revamp its website and forums. With the help of a Web-based bulletin board software solution from Ideal Science, they launched their modified forums with a revamped website. Within the first five days, more than 20,000 new posts were added to the forums and stoked the fires of anticipation even higher.

“Using our software, customers can create online communities to promote products and services,” said Kerr. “Additionally, they can use the forums to generate buzz about future products and services. These communities will establish loyalty and brand recognition. For example, prior to the release of Halo 2, Bungie used Ideal Science forums to generate buzz by releasing screenshots which fans would spends hours having conversations about on the Bungie forums. On the day of the release of Halo 2, over a million people visited their website and sales exceeded 100 million.”

“Video game publishers have a much more important reason to network than anyone,” said Rogers. “Beyond that, most of us still don’t need to be overly concerned with Hollywood. The reason game publishers need to be involved with Hollywood is primarily to strike deals for Hollywood content and to provide avenues for the future exploitation of video game properties. That said, the number of people involved here is minimal. All major publishers have a licensing manager to handle this interaction. For independent developers, there is a ‘slightly’ growing need to be involved in Hollywood. I say ‘slightly’ growing because there are a few larger independent developers who have the ability to purchase top Hollywood properties to integrate into their games.”

“For the rest of us, Hollywood is a great place to visit, but there is little actual work to be done there,” continued Rogers. “Too often video game developers get caught up in the memorizing lights of ‘Hollywood’ and end up spinning their wheels or securing properties that have little value in our industry. Studies and history have shown that generally only the top grossing Hollywood films will even have a chance of breaking even in our business. And for the most part, these properties are licensed to major video game studios for millions of dollars. I suppose someone might get lucky with a ‘Blair Witch’ like video game license down the road, but my advice to independent studios is to stick to what you do best and what Hollywood still hasn’t learned how to do, which is to make incredible video games.”

Out of touch…?

While it is increasingly becoming an issue in the gaming industry how publishers are “out of touch” the subject does not come up as often as it does with Hollywood. A lot of money gets thrown around, and by the time most movies finish their cycle in the theater, DVD rentals/sales etc. the productions are profitable. The question remains, though, whether this success is due to quality, or sheer momentum of the Hollywood industry grinding things out.

“Hollywood elite appear to be making a lot of films that do not resonate with the general public,” commented Rogers. “For example, look at films that surprise the critics and film professionals such as Passion of the Christ. Few in Hollywood thought it had a prayer (pun intended) of breaking even. But if you would have asked the average consumer in the Midwest of the United States, they would have told you something quite differently.”

“Professionally, I don’t think Hollywood has ‘lost touch’ with our industry,” he added. “With due respect, I don’t think they ever had ‘touch’ to lose. Steve Jobs is now one of the top film executives in Hollywood (Buena Vista Animation). Isn’t he the co-founder of Apple Computer? It seems to me that technologists may have a better idea of how to make entertaining Hollywood properties than Hollywood insiders have of making video games. Hollywood still has a lot to learn about the video game industry. On the other hand, there are exceptions. Companies like Vivendi Universal, who for years were struggling in the video game space, have learned through a lot of expense and trials how to make great games. They have learned a lot of valuable lessons and others in Hollywood may take note of their example.”

“Video game producers have not had a drop in sales similar to what Hollywood is experiencing,” said Kerr. “We believe this is attributed to the fact that the video game industry knows exactly what their customers want by listening to them on their online communities.”

Get buzzed

“Buzz” is something of a nebulous term, but generally it signifies the level of talk surrounding a certain product. Buzz before a product launches (or hype) is good, but buzz after a product launches is golden. It’s what the gaming industry seems to do fairly well (see the above Halo 2 example) and is something that, by contrast, only seems to happen by accident with Hollywood movies.

“All game titles use forums as a tool to generate buzz and get feedback from gamers,” said Kerr. “Specific movies that would generate the most from using Ideal BB.Net forums include sequels and those based on comic books. These movies tend to have the most eager and loyal fan base.”

“Buzz is all important,” concurred Rogers. “A decade ago, I was a marketing director in this industry (Sierra On-Line and Virgin) and we believed in a concept I called ‘Heating the Core.’ The general idea was that the purchase decisions made by key influencers (avid game players) had a ripple effect outward to casual gamers. If you ‘heated the core’ hot enough, these influencers could pre-sell to those more difficult and expensive to reach. That was a decade ago, when we were spending very little in television advertising. Today, publishers like Activision report that their ad budgets are equal to their game production budgets. But despite this significant increase in the scope of video game advertising, the ‘buzz’ factor is all important. And with the Internet, viral advertising has a way to touch both groups. Nevertheless, it would be a big mistake to release a game today without addressing the all-important fan base and avid gamers.”

by David Radd




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