Top Film Industry Stories of 2014 #3:
The Terrible, Horrible, No Good, Bad Summer of Box Office
By David Mumpower
January 8, 2015
BoxOfficeProphets.com
The numbers never lie. Only 1.26 billion tickets were sold in 2014, the lowest amount since 1995 garnered 1.21 billion. To put this into perspective, Xena: Warrior Princess was a brand new show the last time movie theaters were so empty. Also, Maggie Simpson had just shot Mr. Burns during Season 7 of The Simpsons. Peyton Manning was still three years away from being drafted, Kobe Bryant was a McDonald’s All-American high school player, and Mike Trout was four.
Historically, box office ticket sales have always been in decline since the medium’s halcyon days prior to World War II. The numbers have been disguised by constant ticket price inflation and an ever-expanding number of exhibitors who have made movie consumption an around-the-clock process. So, a lot has to go wrong for ticket sales to shrink rapidly, and it surely did over the past year.
In 2013, composite North American ticket sales were 1.34 billion. Where did those 80 million worth of ticket sales go over the past year? The losses were a combination of gradual and dramatic. Most of the issues surround the summer movie campaign, ordinarily the most lucrative part of the non-holiday movie calendar.
Box office revenue declined a historic 15% from the summer of 2013 to 2014. The factors leading to this precipitous drop in earnings exemplify the maxim "death by a thousand cuts." There was no singular tentpole release to carry the day, as there had been with Iron Man 3 in 2013. In fact, the fourth most successful release of 2013, Despicable Me 2, would have been the number one movie of 2014…by over $40 million.
The summer of 2014 was also amazing in a different regard. For the first time since 2003, no film opened to at least $100 million. Half a dozen films came close by posting debuts north of $90 million. However, all of them fell short of the established nine-figure mark that identifies a monolithic opening weekend. No film from the start of May until Labor Day weekend proved enticing enough to become a true tentpole performer. Without a linchpin $100 million opener/$400 million earner to compensate for other failures, this past summer was already playing from behind.
Of course, there was another key factor that contributed to the problem. Actually, it was a pair of problems. Two films that were surefire $225+ million performers slotted for the summer of 2014 were indefinitely delayed. The first of them was the latest offering from the Fast & Furious franchise. Series star Paul Walker’s death delayed principal photography, as the production team scrambled to deal with a tragic outcome.
In the absence of an expected box office heavyweight, the summer still could have performed acceptably had the anticipated Pixar offering performed as expected. Alas, the company’s dedication to quality forced them to delay The Good Dinosaur from May of 2014 until November of 2015. This is tremendous news for 2015, as there have never been multiple Pixar films released in a single year. For 2014, however, two obvious blockbusters never earned a dime for exhibitors. That’s over 50 million of the 80 million ticket gap right there.
The gradual issues with the summer box office were demonstrated by the consistent weekly underachievement. Starting with the first week of May, box office declined 12 out of 18 weekends from the same frame in 2013. There was only one stellar increase during that timeframe, the first weekend in August when Guardians of the Galaxy debuted. Conversely, there were several weekends when box office absolutely collapsed in comparison to 2013.
The cause for the declines is indicative of a growing issue in Hollywood. As the studio projections rely more upon international box office, the underlying algorithms anticipate that 65% of revenue will be grossed overseas. The types of films that these international audiences embrace are simply described. They are sequels, animated movies and superhero movies, all of which are derivative by nature.
North American audiences seeking something novel and fresh during the summer of 2014 were largely out of luck. Beginning with The Amazing Spider-Man 2 on May 2nd, 13 sequels were thrust upon consumers during the summer. And that total does not include stories based upon popular characters such as Maleficent and Hercules, the franchise reboots of Godzilla and TMNT, or the de facto Marvel sequel Guardians of the Galaxy. If there were an underlying theme for the summer, it would be: “More of the same leads to less customers.”
Sadly, this trend does not appear to be changing for the upcoming year, but 2015 has the advantage of sequels that people actually want to see such as The Avengers: Age of Ultron and Star Wars: Episode VII – The Force Awakens. Conversely, the follow-ups from the summer of 2014 included such disappointments as Sin City: A Dame to Kill For, an unmitigated disaster, and the afore-mentioned Spider-Man sequel that earned $60 million less domestically than any prior Spidey title.
While many analysts are quick to dismiss the woes of 2014, especially the summer, as anomalous, the underlying reasons for the behavior are troubling. An entire generation of teens who are historically the money demographic for Hollywood over the past century has been indoctrinated into new technology. Streaming has been their way of life for years now, which means they don’t have the same loyalty to theaters that people born before 1995 once did.
Similarly, Hollywood’s monetary obsession with international revenue has created a firewall against most ambitious original concepts. With sequels too prevalent in the marketplace, consumers are less incentivized to visit the theater. As an example, the hugely derivative Transformers: Age of Extinction experienced a box office drop of over $100 million in North America, and part of the explanation is that the film was more difficult to market because it was so clearly made for Chinese consumers. Illustrating this point is the fact that Li Bingbing was thrust into the cast even though her grasp of the English language is a work in progress.
These trends will be ignored in 2015, because a majestic slate of movies should trigger a banner year for box office revenue. The issues that ruined 2014 are not going away, though. Don’t be surprised if the dissipating ticket sales that occurred this past year become the trend moving forward with 2015 becoming the exception and the past year the rule.