10. Create an ancillary products strategy.
You can also sell movie-related "stuff" on your website. In addition to selling the DVD and the T-shirt, you might sell a CD of the sound track, or third party products. The 'Products' page http://www.neoflix.com/store/pre55 on the Good Dick website is a good example of this strategy.
Third party products might include a DVD from another filmmaker, a book, music related to your movie, or other music that you think your audience would like. The way this usually works is that you buy third party products at wholesale and then sell them at discounted retail from your website.
Think in terms of multiple revenue streams
When you start thinking about earning money from your film, try to think in terms of having many separate revenue streams. It is often better to have a number of deals with different companies, than to have one deal with one company for all rights. When you have deals with several companies, the potential revenues are less likely to be eaten up by expenses or cross collateralization.
What is cross collateralization?
Cross collateralization is the practice in which a distributor that owns multiple rights takes the profits from one area, and uses them to pay themselves back for any losses in other areas. Here is a simple example.
Let's say you have a deal with Distributor X. Distributor X tells you that their profits in Russian sales were $100,000, but they lost $100,000 when they tried to sell your movie in France. The net to you is zero.
If, however you had two deals, things are different. Let's say you have a deal with Distributor Z (a specialist in Russian sales) and another with Distributor Y (a specialist in French sales). Let's say Distributor Z earns $100,000 in Russia, and Distributor Y loses $100,000 in France. Distributor Z sends you the $100,000 and Distributor Y takes a loss of $100,000. The net to you is $100,000.
If you work with companies that have expertise in a particular area, then your chances of doing well in that area are much better. The problem with deals that take many, if not all, of the rights is that often the companies that acquire all the rights are good in some areas and not so good in others. As a result, the rights are under-exploited in certain areas.
I asked Broderick if he would outline what he does when he develops a distribution strategy for a film.
TL: First off, how does someone contact you, if they are interested in having you consult on one of their films?
PB: If people are interested in the possibility of consulting with me, they go to my website http://www.peterbroderick.com/consulting/consulting.html and there's a form they can fill out, it's really simple, it takes I don't know… two minutes? We look through the forms and then we choose the filmmakers we think we can be helpful to, and schedule a 15-minute call with the filmmaker.
Before that phone call I will read the form, visit the website if there is one, and watch the trailer if there is one, and I will have a sense of the film. Then, on the phone call, I will get a sense of the filmmaker's vision of distribution, and determine whether I can be helpful to them. In addition, they can think about whether they want me to help them. If they do, we will do a consultation.
My rule for myself is that I won't consult with a filmmaker unless I am convinced that I can be of real help, and in particular I won't consult with filmmakers unless I'm convinced that I can make or save them more money than I'm going to cost.
When I do an initial consultation, it may include 2 or 3 consulting sessions (of about an hour each) after I screen the film for a total of 3.5 or 4.5 hours. When I do two consulting sessions, we focus on the strategy and next steps during the second session.
Once I agree to consult on a project, the first thing I will do is to watch the film. After I watch the film, I do an initial consultation with the filmmaker. The initial consultation includes two or three consulting sessions (of about an hour each) after I screen the film, for a total of 3.5 or 4.5 hours. When I do two consulting sessions, we focus on the strategy and next steps during the second session.
