With the recent failure of Mars Needs Moms, there has been some speculation that the market has become saturated as everyone seeks a slice of the the lucrative pie that is animation (the link is behind the New York Times subscription wall so nuts to them) . While it would certainly appear this way, I doubt that that is the case. Here are the reasons why.
1. On Average, less than one animated film a week comes out
Sometimes there appears to be a deluge, but for the most part, oftentimes animated films have it all to themselves when they are released. They are more likely to have to compete against a live-action film aimed at their audience than another animated one.
2. The market is tightly controlled
The cinematic market for films is tightly controlled by both the large studios and the large cinema chains. They are the gatekeepers in terms of what can be shown and when. While competition between the studios is good, there is often agreement when it comes to when films are shown, to avoid clashes that end up splitting both films audiences.
3. The big boys have a schedule
The two most prolific animated studios, Disney and DreamWorks, have a set schedule that they do not tend to differ from. Disney has one Pixar film a year with normally at least one Disney-branded one as well. DreamWorks had hoped to to about 2.5 films a year (that’s 3 in five) but that has since been pulled back to something more manageable for Jeffrey Katzenburg’s studio. The point is that both studios don’t really differ in the amount of films they offer.
4. Standards are being raised
Arguably, ever since Pixar burst on the scene in 1995, the standard for animated films has been raised spectacularly, and I’m not talking visually here. Storytelling, character and direction have all fallen under the Pixar influence. Nowadays the audience fully expects to see films as complete and complex as what John Lasseter and Co. put out and they have become merciless if they feel disappointed. Witness the recent failure of Delgo (Elliot Cowan’s favourite film) or the relatively poor performance of Battle for Terra. The list can go on, although no studio should be under the illusion at this point that the audience will accept anything.
5. The Core Audience Isn’t Changing
Unlike the customers for other forms of films, the core market for animated films isn’t really moving. Kids that are watching these films generally aren’t the ones downloading them from the internet. That may change someday, but for now, the vast majority of parents are more than willing to take their kids to the cinema. Unlike say, an R rated film, whose potential audience may just decide to download the film from the internet before it is even released and skip themselves a heck of a lot of hassle. The point is, the market is actually growing (slowly) so until we see a rapid upswing in the number of animated films, it is highly unlikely that the market is saturated.