MICRO-ANALYSIS: Looking at the Micro-Budget feature in the contemporary distribution landscape

By Jeffrey Winter

At some point in our formative childhood years, we learn that “progress” is the process of getting “bigger and better.” We come to understand that $100 dollar in 1900 is roughly the equivalent of $2,680 today (http://bit.ly/aeZM3U). What we used to call a millionaire we now reserve for billionaires. We assume that the passage of time means things get easier, more rational, and yes, “better” overall.

As adults we learn that “progress” is not nearly as simple as all that. In fact, — we backslide, we re-invent, we encounter new technologies that change everything. When I first got into this business full-time, a $1 million movie was considered a throwaway, what we flippantly termed  “straight to video” or a network “movie-of-the-week.” Yet for the most part, those films did very well financially, and were the cornerstone of a rich, powerful, and largely insular and undemocratic Hollywood.

Now that time seems like a distant dream (or nightmare, depending on your perspective). Nowadays, if your average indie filmmaker says they spent $1 million on their film, people look at them like they are utterly decadent and out-of-touch (unless they have movie stars in their film).  There are numerous factors that have contributed to this of course, including… 1) the democratization of digital filmmaking technology and the explosion in the number of independent films being made as a result; 2) the radical fracturing of the film consumption habits of the public given their thousands of channels and ubiquitous access to on-demand content; and 3) the crash of 2008 and the predominantly backsliding global (especially US and European) economy that offers us no reason to think that things will get any better any time soon.

And so, we have entered the era of the Micro-Budget film, which Microfilmmaker Magazine defines as a “less than a 30,000 budget,” and which they claim amounts to 80 – 90% of all independent films today (http://bit.ly/o1oD5h). For the purposes of framing this discussion, I am going to be a bit more generous as to what we can call “Micro-Budget” ….I’ll go to approximately $100,000 for sake of argument. (Note: prior to 2008, I was preaching to filmmakers that $250,000 was still micro-budget, but my how things have changed).

Why $100,000 today you ask? Because at $100,000 or less, one can easily wrap one’s brain around how a no-stars indie film can achieve financial recoupment by simply plumbing the basic mechanics of contemporary film distribution, from film festivals straight through to digital distribution and all the steps in-between. Therefore, it falls more in line with the model we previously called “straight-to-video,” (i.e. not requiring profits from theatrical distribution), albeit much more complicated and work-intensive than it used to be.

This model of the contemporary Micro-Budget film doesn’t necessarily require a big Sundance premiere or major sales miracle, but I am not making the claim that it is therefore easy by any means. First of all, it generally requires that the film be good if not great, which certainly wasn’t the case in the straight-to-video era (when so much less product was available than it is today, such that mediocre and even god-awful content was still most of what was available to us as a film-viewing public). In addition, today’s marketplace requires incredible dedication, marketing savvy, and brute hard work to get the film available, noticed, marketed, and consumed….which filmmakers can either choose to do themselves, or find like-minded partners, consultants, and platforms to help them achieve their goals.

As the technology has evolved, today’s filmmaker are no longer constrained by “gatekeeper” companies in their ability to get their films available for public consumption… there are endless number of good ways now to get your film available to millions to be seen. Now the challenge is to let people know that your film actually exists, to find an audience you can connect to, and to monetize that connection.

As a mini-case study of this phenomenon, I’ll refer here to a micro-budget film that we, The Film Collaborative, shepherded to marketplace in 2010 called THE OWLS, directed by Cheryl Dunye (OWLS in this case is an acronym for “Older, Wiser, Lesbians”). The film, produced for under $25,000, achieved a significant film festival world premiere at the Berlin International Film Festival, as part of the Panorama section.

As a lesbian-themed feature with major festival pedigree, it attracted significant attention from gay & lesbian film festivals all around the world…nearly all of whom paid screening fees to show the film. While there were no “movie stars” per se…it featured a cast that was very well known in lesbian communities all over the world. It sold to small queer distribution companies in all major territories, and achieved favorable DVD and digital distribution arrangements in the U.S.

And voilà, the math added up and the budget was easily recouped through the basic steps of niche, micro-budget distribution.

This is the blueprint of the contemporary micro-budget feature, although of course it isn’t always as easy to identify your core audience. Most of you will have to work harder at doing so….but that doesn’t mean it isn’t doable for many. The key factor here is to “know your audience,” and to remember that in a fractured distribution audience, in fact, “niche is king.”

I’ll close here by saying that one of the core mistakes of micro-budget features today is to think that by finishing a film for a remarkably low production budget means you are “safe” because they money will inevitably flow back to you. That is utter folly. First of all, and most importantly, your film will need to be good. Long since gone are the days that a mediocre film will attract an audience already glutted by available content.

Even more critically, you’ll need to find ways – both creative and financial – for alerting people to the fact that your film exists and that it demands to be seen. In a standard Hollywood studio model, there now exists at least a one-to-one model for matching marketing dollars to budget dollars….meaning that is entirely understood that a $100 million studio flick will require a minimum of $100 million dollars in P&A to market it. And yet this concept is entirely overlooked in the indie space…. I have yet to hear of an indie filmmaker who made a $50,000 film and also spent $50,000 to market and promote it. Imagine all the facebook ads, social media consultants and interns, marketing promotions, grassroots organizations, special event screenings, reviews and blogosphere promotions you could generate if you actually spent as much money on your distribution and marketing as you did on the production of your film.

I realize that most of us are still a long way away from being able to budget the marketing of our films into the actual production process…I realize that most of us can’t set $50,000 aside for our $50,000 micro-budget films. But I would argue that ultimately we will have no choice,  as marketing emerges as king above all other factors. If the means of distribution will democratize, then only the most savvy of marketers will survive.