Hindi Films & Business Predictability ??? Shashin Devsare Mumbai May 2004
Disclaimer <ul><li>This presentation has been prepared only to demonstrate universal applicability of sales & marketing approaches, strategies & tools across different industries. </li></ul><ul><li>The author is a senior sales & marketing professional in Telecom industry & has chosen “Predicting Success Factors in Hindi Films” due to popularly known risks & unpredictability associated with success of Hindi Films. </li></ul><ul><li>This is purely a business case study & does not intend to be conclusive or decisive on any or all parts of the aim & approach stated. </li></ul><ul><li>The data used herein is from industry sources & the author of this presentation does not take any responsibility for its validity or authentication. </li></ul><ul><li>This presentation should not be used for any commercial purposes whatsoever & is only meant to support the idea expressed in point no.1 </li></ul><ul><li>The author of this presentation would like to state categorically that he will not be responsible in any manner for any use or misuse of the information, analysis or statements made herein by any party/individual. </li></ul>
Aim….to arrive at predictable success factors for Hindi Films …..using simple analytical tools, practicable sales & marketing methods/approaches. Basis: Secondary Data + Personal Interviews
Historical Data <ul><li>Total Business Volume: INR 1085 crs / US$ 2.5 billion </li></ul><ul><li>Top 10 movies contributed 38% & Top 25 movies contributed 67% to the entire biz volume. </li></ul>Period: 2000 – 2004 (5 years) Selection: Top 50 Hindi Films (Revenue Earned Basis) Data Source: IBOS Network <ul><li>Total Profit: INR 250 crs / US$ 55 million </li></ul><ul><li>Total Loss: INR 112 crs/US$ 24 million </li></ul><ul><li>Profit Loss as accrued to Distributors & Not Producers </li></ul>Period: 2000 – 2004 (5 years) Selection: 33 Hindi Films (Out of the 50 for which Budget Figs were available) Represent 70% of total biz volume i.e. INR 761 crs or US$ 1.7bil http://www.ibosnetwork.com
Key Findings <ul><li>Interestingly while the budget is almost equal in both the cases, revenue is almost >100% in profit making films vs loss making films. </li></ul><ul><li>The profit % is as high as 70% in case of profit making films. </li></ul><ul><li>The loss % is ~36% in case of loss making films </li></ul>Healthy Profitability Trend Predicting Correct Success Factors = Very High Profitability INR
Product Segmentation Action/Thriller Romance Drama Comedy Based on predominant factors behind success. Film Plot Based Segmentation Film Treatment Excluded 38% 12% 36% 8% 6% Offbeat Key Plot Idea
Budget (Pricing) Does Not Give A Clear Idea Budget Based Segmentation Of All 33 Films Up to 10crs is the ideal budget Budget Based Segmentation Of Profit Making Films
Key Product Feature (Hero) <ul><li>Shahrukh & Hrithik have maximum no. of movies in the top 50 revenue grossers. </li></ul><ul><li>Amitabh & Akshay share no.2 spot </li></ul><ul><li>Hrithik films have generated maximum revenue in the recent business generated comparison for the last 5 films of top heroes. </li></ul><ul><li>Amitabh, Shahrukh & Aamir share no.2 spot </li></ul>
Key Product Feature (Hero) Clearly Hrithik is No.1 followed by Aamir, Shahrukh & Amitabh
Distribution (Territories) There are major territories and minor territories depending on the market-size of the audience for Hindi films there. For the purposes of enumeration, all territories are rated as a percentage of an arbitrary major territory. Mumbai Territory – 100% Mumbai Gujrat Western Maharashtra North Karnatka Delhi/UP – 100% Delhi Uttar Pradesh North India/ East Punjab – 45% Punjab Haryana Himachal Pradesh Kashmir Central Circuit – 90% CP Berar – 40% CI – 20% Rajasthan – 30% Eastern Circuit – 90% West Bengal – 30% Bihar – 40% Orissa – 15%, Assam – 10% Southern Circuit – 45% Nizam – 25% Andhra – 7.5% Mysore – 15% T.N. & Kerala – 5% Major Territories Minor Territories Overseas – 100% Simultaneous Release Across All Territories To Enjoy 1 st Week Benefits !
Launch Timing Not much difference between releasing the film in Q2 – Q4 period Q1 however is least favored April, June & August are most favored months.
Marketing Plan Three Pronged Marketing Plan Exhibitors = Cinema Hall Owners Distributor Gains (Best Price From Exhibitors) Exhibitor Gains (Film runs full house) Producer Gains (Best Price Per Territory From Distributors) HIT FILM !!! Generate High Walk-ins Create Value For Distributors Create Value For Exhibitors
Marketing Plan 1. Conduct Test film previews with select audience. 2. Share results of test previews & positive audience reactions with distributor. 3. Use historical data to establish plot choice, launch timing, budget, hero’s selection etc. 4. Offer a profit & risk sharing proposal if necessary. 1. Share film promo plans & budgets. 2. Share increasing walk-ins strategy. 3. In cinema hall promotions. 4. Localized promotional support – news paper inserts. 1. More focus on PR than mass media advertising. 2. Conduct movie based quiz contest/lucky dips in cinema hall during interval & award lucky winners “ on stage” in front of the entire audience. 3. Intriguing teaser promos & film’s theme based cross promo tie ups with FMCGs &/or durable companies. Generate High Walk-ins Create Value For Distributors Create Value For Exhibitors
Successful Film Mix Romantic & Action Oriented Film Made With A budget Of ~10crs Starring Hrithik Distributed & Released Across All Territories Simultaneously Released During April, June or August Backed with Innovative & not necessarily High budget Marketing plan Successful & Profit Making Hindi FILM!! =