When you put a budget together for your business, you of course should be thinking about ROI. You’re spending a certain amount on your staff payroll, offices, technology, outsourced services, coffee cups and whatever else you feel you may need. At the end of the day, though, it’s not how much you spend, it’s what you get in return.
The same can be said of the movie business. Whether you're producing a blockbuster or a quiet indie flick, you want
to get a good return. Let's take a look at the ROI on the top grossing movies of 2012.
1. Marvel's The Avengers - ROI 183%
2. The Dark Knight Rises - ROI 79%
3. The Hunger Games - ROI 423%
With a budget of only $78M and a gross of $408M, The Hunger Games' success may be the most remarkable of these three. For more on blockbuster successes, visit our post on the amazing ROI of the Twilight series.
Other critical and business success stories include:
Argo - ROI 134%
21 Jump Street - ROI 229%
Flight - ROI 190%
Looking at these examples, you might think the movie business looks easy. But consider John Carter. With a $250M budget, the film had an ROI of -71%, grossing only $73M. Ouch! You can certainly spend big and get great returns, but this is what happens when you haven't carefully considered your risks. A description of the plot from IMDB might explain part of the problem with John Carter: "Transplanted to Mars, a Civil War vet discovers a lush planet inhabited by 12-foot tall barbarians."
Other large scale ROI busts from 2012 included:
Wrath of the Titans - ROI -44%
Battleship - ROI -69%
Dark Shadows - ROI -47%
The point is that it's OK to have a big budget...or a small one. The key is spending wisely and understanding your audience/customers.