There are several ways in which a documentary can earn revenue. Maximizing each revenue stream, while minimizing the costs associated with revenue collection and the time required to collect revenues, is the key to creating a ﬁnancially proﬁtable ﬁlm.
Films can be distributed in the following ways:
- US Theatrical Release
- Foreign Theatrical Release
- Pay Per View/Video On Demand
- Cable Television
- Broadcast Television
- DVD, YouTube, UnBox
- Foreign Cable, PPV, VOD & DVD Sales
From a ﬁnancial perspective, a theatrical release is key to the ﬁnancial success of most very proﬁtable and widely seen documentary feature ﬁlms. Without a theatrical release, even well produced ﬁlms about hot topics and with support by famous guests or narrators, end up going directly to DVD. Some documentaries may end up on cable or broadcast television without a theatrical release, but if they have a good theatrical release that transition is usually guaranteed.
Even a very small but proﬁtable theatrical release, ten to twenty screens over two to four weeks, is enough to greatly increase a documentary ﬁlm’s value. If reviews during that time period are very good, because the ﬁlm is tightly marketed to exactly the right audience, success is assured.
Now you know why so many documentary ﬁlm makers seek theatrical release. However, in recent years US theatrical releases have not proven proﬁtable for most production companies. In fact, they have proven an expensive “loss leader” instead.
This is because:
- Movie theaters, called Exhibitors, typically take 50% of US Domestic ticket sales.
- Traditional distributors frequently demand 30%-50% of US Domestic ticket sales.
- Producers/Investors typically receive just 0-20% of US Domestic ticket sales Actually the situation is worse than that.
Distributors frequently require that independent ﬁlm producers invest several hundred thousand to several million dollars in Prints & Advertising budget in order to cover the distributor’s costs and to minimize the distributor’s risk as they promote the ﬁlm. This is particularly true in the case of a documentary ﬁlm because they are perceived to have a smaller market than most feature ﬁlms. If you look at the table of successful documentary feature ﬁlms listed earlier in this book you will understand that some documentary feature ﬁlms have very, very large markets.
In order to get a Distributor to give a ﬁlm a theatrical release, producers and their investors end up investing far more money than they are likely to see in direct revenues from the release.
Distributors also determine the marketing plan for a ﬁlm’s release and negotiate terms with exhibitors.
Sometimes the posters, ads and other materials created by the distributor are inappropriate to the ﬁlm. The result is a project which never ﬁnds its market.
Distributors sometimes decide not to release a ﬁlm despite the impact of that decision on the ﬁlmmaker. This happened to Michael Moore with FAHRENHEIT 9/11.
Sometimes Distributors will favor one of their ﬁlms over another, meaning that while one ﬁlm gets a great release another ﬁlm with the same budget will get a poorly negotiated one.
Finally, in addition to a percentage of ticket sales, distributors who take on a ﬁlm prior to theatrical release take up to 25% of revenues from some or all subsequent right sales including PPV, Cable, Foreign Sales, etc.
These days, many ﬁlms are being released to the market via a service deal distribution. Under this model, production companies pay for theatrical release. The “ﬁlm distributor” provides only very speciﬁc services in return for payment up front. Productions create and execute their own marketing campaign with dedicated professional help, depending on distributors only to handle media delivery and selected other tasks which vary from production to production. The result is that production companies keep a much larger percentage of the money received from theatrical release.
The place to begin evaluating your distribution is see how ﬁlms similar to yours were distributed. One way to do this is by checking out websites likewww.ﬁlmspeciﬁc.com, www.boxofﬁcemojo.com and www.the-numbers.com. You can also hire experts to suggest distribution strategies for your ﬁlm. Stacy Parks of www.ﬁlmspeciﬁc.com is a great resource.
If you are producing your documentary for distribution to a very select market, it may make sense to self-distribute it though www.createspace.com orwww.kunaki.com. This is feasible when you are producing a documentary for an organization or charity with a large number of potential customers that you can reach via email or presentations.
Before you start shooting your ﬁlm, you should know exactly how it will reach its market.Tweet
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