The Value of an Oscar Nomination
By Reagen Sulewski
December 8, 2010

Who wants to be a millionaire? All the people who handle awards season Oscars campaigns.

As we head into awards season, it's useful to think about why studios make such a big deal about the shiny gold statues they hand out every year. It's not the fact that Hollywood homes have a bunch of shelves and they just need something to put on them. It's not even (totally) about ego. The biggest reason they chase after Oscar nominations is, shockingly, money.

For many films, awards recognition, and particularly an Oscar nomination, is one of the surest ways to improve their bottom line. While people may scoff at the actual winners sometimes, the awards serve as a handy way for casual movie goers, and even hardcore buffs, to sort out what's supposed to be good each year. Instantly when the list of five (now ten) Best Picture nominations come out, those films for the most part become more commercially viable as people decide they need to see them to have an opinion on them or simply because they serve as a recommendation.

Often it can be the difference between a film staying in theaters or getting booted from them. A Best Picture nomination, or a couple of high profile acting nominations, can serve as the springboard for a tiny indie film getting placed in thousands of theaters, for better or for worse. Not getting one when you were expecting one cuts you off at the knees. Last year, films such as The Lovely Bones, Invictus and The Road missed out on many of the nominations that were expected for them and died on the box office vine. Meanwhile, films like An Education and Crazy Heart racked up millions by exceeding awards expectations.

So what are these nominations worth, then?

It's a fair point to ask whether a film's box office is raised simply from being in consideration for an Oscar nomination, even if they don't get it. I'd say that's almost indisputably true, but basically incalculable and it's not what we're really interested in. It's the value of that chyron over the TV ad boasting about a film being selected as one of the best of the year that I'm interested in.

Sometimes the effect for a film is rather obvious. American Beauty was re-released into theaters solely to capitalize on being nominated. Without those extra weeks at the box office, it misses out on the $56 million extra it earned. Examples are rarely this clear-cut, however.

The biggest thing to realize about Oscar nominations with regards to box office is that their main value results in getting people to a movie they ordinarily wouldn't have seen. So let's get some exceptions out of the way. When an Oscar nominated film is already a hit, there's often a counter-intuitively smaller jump in a film's bottom line than for a film that has yet to break out. The two clearest examples of this are James Cameron's last two films, Titanic and Avatar. Both showed unusual legs for their time period, but their gains from their Oscar nominations are probably impossible to sort out, if they even exist. Avatar's box office even dropped more in the weekend after it was nominated than the weekend before.

But these are extreme exceptions in that they earned more than $20 million in those weekends anyway, an extremely high figure for the typical Oscar nominated film in its weekend of nomination, and were firmly entrenched in the pop culture landscape, with over $300 and $600 million in the bank respectively. People who needed validation by the Academy to see Titanic or Avatar weren't really paying attention.

On the other end of things is when a studio is so small that it doesn't have the ability to pay for prints and advertising for a film when it is recognized. Last year's The Messenger received two significant nominations – for its screenplay and Woody Harrelson for Best Supporting Actor, but never got above 34 locations. The film's distributor, Oscilloscope Pictures, specializes in boutique releases, and has never exhibited a film in more than 40 venues in one weekend. The Messenger's $1.1 million final gross is the highest grossing film in its four year history. The value of those nominations, at least in terms of theatrical box office, was so close to zero as to be unmeasurable, because the studio didn't have the ability, or maybe even the desire to get its film seen in theaters.

So, on to the films that did see an effect. Because this is box office, we'll have to make a couple of assumptions – that films which received nominations would have continued on at roughly the same rate of decrease in box office as if the Oscars didn't exist, essentially restarting a film's clock from that point, and that films wouldn't have received a wider expansion. That second one is bit larger of a leap, but without it calculation for some films would be impossible. And on a practical matter, to stop tallying box office once a film's calculated box office drops below $250,000 in a week – we have to draw the line somewhere, and screen availability would become an issue at some point.

Last year's Oscars turn out to be a bad one for examining the phenomenon. Even with the increase to ten Best Picture nominees, last year only five of them were still in theaters, one the aforementioned outlier Avatar. Of the four remaining films to examine, The Blind Side, An Education, Precious and Up in the Air, none showed any great performance after being nominated. The Blind Side had the highest weekend total of those four at the time of nomination, a mere $2.5 million. It got a kick up of around $400 thousand that weekend, which through modeling at a 25 per cent estimated drop off, turns into slightly more than $5 million extra over the next two months. Up in the Air's positive performance post-nomination was barely noticeable - perhaps as little as a $250,000 boost to the weekend following nominations.

Of our two remaining Best Picture nominees for that year, both were effectively out of theaters by the time of nominations (An Education was in 75, Precious was in 222), and both got significant expansions following their nominations. In these cases, I feel it's fair to attribute pretty much the entire post-nomination box office to those nominations. This gives us $3.8 million for An Education and just over $2 million for Precious. Underwhelmed yet?

So why chase Oscar then? Well, for An Education, that $3.8 million represents 30% of the film's total box office. For another matter, that just happens to be a poor crop of films to look at for the phenomenon. Easily the film that benefited most from Oscar nominations last year was Crazy Heart, which rode Jeff Bridges' Best Actor nomination and win, along with two other nominations, to around $20 million extra in the theaters, if we assume expansion plans would have been canceled without them.

Crazy Heart, then, is exactly the kind of film that's most helped by an Oscar nomination or two – a small drama with crowd-pleasing elements that's brought to the forefront of the public's attention. Some films inspire a range of scenarios. The grand champion of these is the 2009 winner Slumdog Millionaire, which went from a film festival favorite to one of the highest grossing films of that year based on awards attention.

In the case of Slumdog, the assumption that no expansion of release would have occurred in the bizarre circumstance of it not receiving a Best Picture nomination is probably flawed. Contracts had already been signed with theaters with the presumption of nominations. But it's useful to look at scenario that as a upper bound. Presuming it held fast at around 600 screens, and had a better than average weekend drop of around 25%, it earns $25 million more post-nomination date, compared with the $95 million it added to its tally, meaning the nomination was worth as much as $70 million in theatrical grosses.

The range between that and the lower bound turns out to be surprisingly narrow. For that, let's treat it like a normal expansion which manages to hold the dollar value on the weekend, and then falls from there. That earns it $31 million more in its run, leaving a $64 million Oscar bonanza. This is something of a special case, but it's illustrative of why studios try so hard for these nominations.

And spend, too. Harvey Weinstein pulled out any number of stops to get The Reader nominated for multiple Oscars in 2009, raising the eyebrows and ire of many. Did it work? Certainly for Kate Winslet it did, but also for the film's bottom line, adding over $20 million to its final total. All of 2009's nominated films did well – The Curious Case of Benjamin Button earned $10.7 million, Milk earned $10.2 million and Frost/Nixon earned $8.2 million out of their Oscar nominations by the same metrics.

Stepping back one more year, 2008's nominees also saw lucrative jumps after being highlighted. The winner, No Country For Old Men, netted $16.4 million extra from Oscar. The presumed runner-up, There Will Be Blood, did even better, with around $19.5 million extra. That these two films would be able to leverage nominations into a lot of cash makes sense, as they're both difficult thrillers that would unearth larger audiences who've been told that they're Oscar-worthy. The three other Best Picture nominees didn't do poorly, though, as critical and audience fave Juno brought in $9.9 million extra. Michael Clayton managed an extra $9.6 million while Atonement brought in $3.4 million more.

In comparison to last year's meager showing by Best Picture nominated films, that's an alarming drop-off. Has the move to ten nominees cheapened the monetary value of them? It's just one year of data, but it's something that bears watching.

And as for this year's contenders – which of these is likely to benefit the most? Think smaller, first. The King's Speech and The Fighter, two biopics with crowd-pleasing elements to them and limited release patterns could see major boosts with awards recognition. Black Swan and 127 Hours could be the year's wild cards, the “I dare you to see it” films of the year made more important by being among the big ten. It may already be too late for 127 Hours unless Franco becomes the odds-on favorite in the Best Actor race, as it's possible it could be run out of theaters by the late-January nomination date. As with last year, some of the major contenders are basically done with their run – The Social Network, Inception and Toy Story 3 can't gain at the box office from their likely nominations – DVD sales count for the bottom line, certainly, but are outside our scope here and I'd need to see proof that Oscar nominations drive them.

The answer to the question of what getting nominated is worth ends up being a rather unsatisfying “it depends”. On the type of movie, the type (and number) of nominations, how long it's been out, how many people have already seen it, what type of release it's had and what kind of pull the studio has. The end result can be from zero to, if you catch lightning in a bottle, upwards of $60 million. What film's going to get that? Well, it's all circumstance.