Business Models

How Merchandising Will Make or Break Animated Hits

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Clothes-Fred Flintstone

Over on the Kidscreen blog, Scott Shahmanesh has a great post on the topic of licensing, merchandising and making the most of it when it comes to content directed at kids. While his three steps are a superb guide to the rough waters of licensing and so forth, this part is what stuck out to me:

This is a perfect example of how next to no singular form of entertainment has the impact on kids that it had less than a decade ago. New entertainment properties come and go so quickly, it can be impossible to capitalize on them by getting products on the shelves, before the craze is over. If you start while a property is hot, it’s usually dropped from the radar before products have a chance to follow. Just five years ago, a singer/dancer like Psy with the music video Gangnam Style (which had more than a billion views on YouTube) would have generated enough momentum to justify a huge merchandising program. Yet we saw only a handful of products on the shelves before Psy’s moment came and went. Kids quickly moved onto the Harlem Shake. And somewhere in between the two,we were all singing “Call Me Maybe.”

Therein lies the challenge to content creators and producers.

How Merchandising Will Make Animated Hits

Of course, we’ve already seen the beginning of what will eventually become the de facto merchandise and licensing model. For the most part, this will be the ‘on demand’ model that many online clothing outfits (no pun intended) already utilise. They focus on the intricate part of the process, namely putting the image on the cloth and by doing it locally instead of in bulk offshore, they can react much more quickly to shifts in consumer demand. End result? All the Adventure Time and Bravest Warriors T-shirts you can handle.

With the rise of 3D printing and the like, it should become possible to manufacture things like toys locally too, or at least move the easier or more time-consuming parts abroad, thus allowing companies to react in similar ways to the clothing firms mentioned above.

Another option will be to simply re-engineer toys entirely and either make them more modular, or alter how licensed characters and shows are portrayed on them. It may be a matter of going about it the Lego way; making standard pieces that are interchangeable between sets and unique character minifigs that can be made quickly.

All told, merchandising, and the ability to design, make and sell it as a show’s popularity rises and falls will be one key to success. The other will be doing it on a constantly repeating basis.

How Merchandising Will Break Animated Hits

If merchandise can make an animated hit, you’d better believe it can break them too. Besides the obvious goofs (like the infamous Little Mermaid VHS cover), there are other factors and traits of the on-demand model that could prove detrimental.

The first is quality. People don’t mind paying a bit more to have things done quicker, but all too often, quick = cheap and nobody likes to think they’ve been ripped off somewhere along the line. On-demand merchandise will necessitate a lot of people working very quickly and efficiently; all of which will cost money. Unfortunately, the temptation to skimp costs or cut corners throughout the process will be too much for some to take. One weak link is all it takes, and once word gets out, you may not have time to recover.

The second is timing. If success is determinant on your merchandise being available, anyone who misses or screws that up will be doomed. How can you mitigate for this? Well, having a plan always helps but having flexibility in the supply chain will be of enormous benefit too. One supplier already maxed out? There should be a spare with capacity ready to go. The gist of this point is, say a show gets super popular super quick, by the time merchandise is designed, tested, manufactured and ready to be sold, the moment may have already passed. It’ll be too late to fix things unless you can get a recurring property going.

Lastly, the very type of merchandise will be a critical factor. Nobody would create adult-sized T-shirts for a kids show, but what if you made the wrong kind of merchandise that fans were looking for? What then? If fans can’t get the merchandise they want, if they’re not offered it, guess what, they’ll go somewhere else, or make up their own; illegal or not. Again, a bit of planning can go a long way, and if anything, listening to and sussing out from fans beforehand can save your bacon in such a situation.

Either Way, Merchandising WILL Have An Effect

No matter how many ways you look at it, the traditional model of extracting things like licensing fees from networks, DVD makers, distributors and even merchandise manufacturers are all disappearing. In the not-too-distant future, there will also be no middlemen either. Studios will have a direct connection to their fans (or through online retailers) and they will have to be on the ball if they want to make any money. The upshot is that they can reap massive rewards if they get it right. The downside is that there is everything to lose if they get it wrong.

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Little Witch Academia Sequel Funded in Just Three Hours!

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Via: Random Curiosity
Via: Random Curiosity

We’ve discussed the Trigger short Little Witch Academia on the blog here before, and it’s nice to see the studio do so many things right with it. So much so, that when a Kickstarter project was released, it was fully funded to the tune of $150,000 in just about three hours! So what has been done to get things so right? Unsurprisingly, its all down to common sense and a bit of luck.

The Original Little Witch Academia Had Risk-Free Funding

Yes, as discussed before, the original was funded by a grant from the Japanese government. That meant that Trigger was free to indulge in a bit of remarkable creativity and inevitably create something that has garnered a lot of critical praise in addition to being commercially viable.

It Was The Epitome Of Superb Content

There’s no doubt about it; Little Witch Academia is what is meant by the descriptor ‘top-notch’. It oozes high quality and craftsmanship the likes of which even Disney has been unable to replicate in the last decade or so. The story is enchanting, the characters are delightful and the animation is nothing short of downright gobsmacking.

Yup, Little Witch Academia illustrates all to clearly how a devotion to quality can work real and lasting wonders.

Trigger Engaged With Fans

Being based in Japan, Trigger could all too easily have ignored fans outside of the country altogether. Instead though, they did everything right with an eye to boosting their presence. Right off the bat, they didn’t pull down the unofficial YouTube leaks; rather, they released an official version replete with corrected English subtitles!

They also listened to fans and continually communicated with a positive attitude about wanting to make more animated Little Witch Academia content.

They Did Things One Step At A Time

Just recently, it was announced that a Blu-Ray home media release of Little Witch Academia is slated for later in 2013. Could this have been done earlier in the year? Sure, but rather than risking a lot of money by making something that potentially wouldn’t sell, Trigger instead waited. When the short’s popularity soared through the roof, they cut a deal. Tying in again with the quality of the content as mentioned above, there should be no problem shifting those discs come August.

The Lessons This Success Story Should Teach

It’s unfortunate that the simple, basic steps that Trigger has taken with Little Witch Academia are so roundly ignored on a daily basis by animation studios around the world. While it’s understandable that they have to work within the confines of TV networks for some of their work, it’s hard to believe that they take the same approach to their own stuff, and seek to impose to everyone the kinds of restrictions they are bound to.

This case highlights the fact that true and meaningful success is totally and easily achievable with the two simple things of great content and a willingness to listen and communicate with those who watch it.

Bravo Trigger!

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Applying Andrew Reid’s Advocate Advice to Animation

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Published a while back was a post over on Fast Company by Andrew Reid that’s all about fans, or rather, fans and influencers and the ease at which both are interchanged and confused. The concept of fan and fandom is often used on this blog, but when it comes to culture, it is harder to distinguish between fans and influencers because they are essentially one and the same. Nobody proclaims love for an animated property for the sake of influence unless they’re paid. Reid brings up many interesting points, but he also lists a few rules that animation studios would be wise to consider. Let’s Take a look.

What Fans Really Define

When we discuss fans and fandom within the confines of animation, we really mean the vast majority of people who just happen to like a particular show or film. In our minds, they are as much advocates as they are fans, and the vast majority of them accept criticism that is warranted.

While Reid uses the term ‘advocate’, it’s hard to see where such people fit into the world of animation. Jeffrey Katzenberg is an obvious advocate, but he’s clearly got something to gain by doing so. Can ordinary people be advocates for animation? Arguably, bloggers are to an extent, but where to draw the line between them and pure fans? It’s blurry, complicated and unlikely to be resolved any time soon.

Coaxing Influencers, or Rather, Fans

Where Reid’s article is wholly appropriate to our cause is in the guidelines it gives to giving advocates a nudge, or the coaxing they need to be more efficient. For animation, (normal) fans would fulfil the role of the advocate. They’re quite accurate; let’s dive in!

Don’t fake the funk

Fans of Sonic the Hedgehog have been caught by this trap far too many times. Pixar is the role model; promising on, and delivering stellar films continually delight fans. Walt Disney was also aware of it; he aimed for, and demanded, perfection with every picture. The brand and company he built with the results are a testament to its mportance.

Never incentivize

How are animation fans incentivised? Well, freebies constitute and incentive and while it can fool kids, adults are wise. A once-off or exclusive is a form of incentive, and they can have similar results. Ever buy an item with an ‘exclusive’ or ‘limited-edition’ extra? That’s an incentive. A real incentive is something that a fan can truly value but it likely won’t substantially grow your brand or revenues.

Don’t sweat NPS

For an animation studio, feedback from fans is much more valuable.

Give them a voice

This is something that studios excel at relative to other industries. There are fan sites all over the internet, and corporate efforts like D23 illustrate how studios can get in on the act too and succeed. It also pays to listen. While you don’t have to blithely agree with everything you hear, fans can give honest feedback that can steer decisions and make them work in your favour.

Ambassador programs are underutilized

Do animation studios even have ambassador programs? Well, sort of. While they don’t have the kind of programs outlined in Reid’s article, they do utilize their characters as ambassadors t great effect.

Could humans fill a different void? What about adult fans? Consider again the service Tugg and its goal of setting up screenings that are essentially organised by fans for their own benefit. The link between it and this point is that whoever organised the Tugg event is an ambassador; they want to entice others to see the film they love. The fact that they are doing it honestly is what prevents them from being mere salespeople.

Animation studios could fo a lot more to have local fans advocate for them in some official way. (They’ve been doing it unofficially for decades with group screenings and conventions.) What could they be?

Concluding Remarks

Fans of animation are, in a way, essentially forced into being advocates thanks to the marginalisation of the technique in mainstream entertainment. Anything that can be done to help them from an official standpoint should.

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Annoying Orange Slapped With Lawsuit

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Another day, another show getting hit with a lawsuit. This time around it’s the YouTube/Cartoon Network hit Annoying Orange and the person suing is, uh, an advertising agency of all things. Yes siree, they are suing because Annoying Orange allegedly infringes upon their idea for a public service commercial for the North Dakota DOT featuring, you guessed it, a talking orange.

Via: The NY Daily News
Via: The NY Daily News

Judging from the picture above, there’s a ton of similarity there. I mean they’re both oranges, right? On top of that, both have mouths, real human mouths that move just like normal human mouths do! Only one adds the eyes, but their irrelevant to the lawsuit apparently.

Yes, I’m being slightly sarcastic, but it’s hard not to, especially when the similarities are far outweighed by the differences. Sure, both are talking oranges, but how many times have we seen that over the course of time. Talking fruit isn’t new, and neither is putting a face on them for that matter.

Furthermore, the nature of the content is completely different. One is a serious campaign for public safety, the other is about entertainment and only entertainment; there’s no safety message there!

So is there any sort of a case here at all? Is this something that creators need to pay attention to or concern themselves with?

It’s unlikely, and here’s why: a talking fruit is not original in any way shape or form, the same goes for putting human mouths on things. It’s a classic technique that has certainly seen use in television for at least a couple of decades. Combining the two surely doesn’t count as anything close to being ‘creative’ under copyright law.

Furthermore, there isn’t a trademark issue either; especially since the client for one of the oranges (the North Dakota DOT) is a public entity; clearly distinct from the private owners of the Annoying Orange. Even besides that, the name of both videos are technically purely descriptive and couldn’t come under either copyright or trademark anyway.

What to glean from all this?

Well, as Steve Hullett over at the Animation Guild Blog points out, there’s a lot of money emanating from one of these videos while the other gets zilch. Readers of this blog ought to be smart enough to figure out why a lawsuit would be filed.

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YouTube Shoots Self In Foot!

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YouTube_logo

Although rumours emerged just last week, it appears that YouTube has wasted no time whatsoever announcing that they are creating paid subscription channels for the site. For the low low price of 99¢ per month (or higher) you can subscribe and presumably be the first to see new content by the requisite creators.

How Do They Shoot Themselves In The Foot Then?

Well, that should be an obvious one, shouldn’t it? YouTube’s bread and butter has been videos that are free. Imprisoning them behind a paywall essentially makes them no different to plenty of other services out there such as cable or Netflix. Why would you give money to YouTube when you can give it to those instead? This is especially so when you are either a) already paying for them and b) they offer all your favourites rather than just ‘new stuff’.

The Fallacy of ‘New Content’ on YouTube

Naturally, the argument goes that you’re paying for the latest and greatest content. A fine point of view except that said content is also competing with everyone else that’s giving it away for free, on the same bloody site no less!

The sad truth that many people have yet to accept is that given the choice between paying for new content and searching for older content that’s free; the latter will win out 90% of the time. Netflix has built their customer base through offering older content, not through the likes of original content like House of Cards. The only reason they did begin producing new stuff is because they reached the natural limit with existing content, leaving the only way to expand though original material.

YouTube has no such limit, users already upload hours of new content every second and show no sign of slowing down. The site has also been massively profitable for YouTube for many years (although exact figures are hard to come by). Besides, how much revenue can Google even hope to reap from offering these paid channels? Even with a million subscribers, you’re talking a few million dollars a year; a pittance compared to the billions that ads bring in.

So What Is The Point

Well, that’s a hard one to nail down. Google clearly doesn’t really need the money, and it’s already failed twice in the past in getting consumers to pay for videos, so what does that leave? Why legacy players of course!

Yes, existing media companies are the ones who are apparently excited about this development (if judging by this list is anything to go by). There’s the Jim Henson company in there as well as, disappointingly, Sesame Workshop. In an ironic twist, animation seems to be over represented on the list of creators looking for the lazy way to make money. Long story short, many established creators have indicated to Google that they would engage more with the site only if there was some sort of paid subscription model.

All in all, the gist is to get people to cough up for something they can get for free somewhere else; a decision that has been, and still is, an unwise choice.

The Alternative for Animation

Do alternatives even exist? Sure they do! Beside the many different ways that creators can make money from their content, David OReilly suggests another one, Vimeo’s tip jar.

He raises a good point. Viewers are not averse to paying for content, just being forced to do so. Plenty of animators have found new and innovative ways to make money, be it from selling T-shirts, selling commissions, making personal appearances and what not.

For independents and small studios, it’s important to remember that subscription models only work well when the audience is extremely large. Otherwise, they act as a barrier to spreading your brand and audience.

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Fan Effort To Revive Young Justice Over Before it Began

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Yoinked from The Mary Sue
Yoinked from The Mary Sue

Bringing shows back from the dead has been discussed here on the blog in the past. It’s a common scenario that often brings great expectations to legions of fans only for them to be inevitably dashed when they fail. Although shows have been brought back (most famously after fans mailed nuts to producers), the vast majority are not receiving of a Lazarus-like new lease of life and are left for history to claim. This time around, it is the DC shows, Young Justice and Green Lantern: The Animated Series that are attempting a comeback. Unfortunately, it’s over before it even really began.

The Background

Both shows ran on Cartoon Network on Saturday mornings. Young Justice beginning in 2010 and Green Lantern following in 2012. Early in 2013, both shows were absent from the Cartoon Network upfront presentation leading to rampant speculation that the shows have been cancelled.

Although the network remained silent, various animators who’d worked on the show or were familiar with the crew tweeted the obvious (sorry, I can’t find them now); the crews had already disbanded and had been for almost a year. While this fact did not get the attention it needed, Cartoon Network eventually responded and confirmed that both shows were indeed finished.

Young Justice & Green Lantern Since Cancellation

Since this announcement, there has been various efforts to get the network to change their mind, including the inevitable internet petition (with not even a please in it). None of them have had any success but that hasn’t stopped a new kid on the block from trying their hand.

The SMGO Effort

Such empty results hasn’t dissuaded internet upstart SMGO.tv (or my Show Must Go On) from attempting to collate fan support for a new series into a single effort aimed straight at Cartoon Network and Warner Bros.

Unfortunately for SMGO, Warners has already slammed the door on the attempt without saying much specifically beyond that they aren’t holding out hope for success. Even that hasn’t deterred SMGO and they’re having another crack at the whip with a ‘let’s prove them wrong’ attitude.

That, in and of itself, isn’t that big of a deal, what should be a concern is that they’re asking for funding, and they’re asking for all of $10 million for the trouble. Now I’m not sure about yourself, but even the largest Kickstarter campaign barely scraped $10 million and that was for a piece of technology that could be used by millions of people. YJ/Green Lantern pulled in just under 2 and 1.2 million viewers respectively in their highest rated episodes. If you ask me, someone has a lot of work cut out for themselves.

The Reality

So SMGO is noble in their effort, but completely oblivious to reality. Their plan is to garner support, talk to the studio/network, sign a contract (yes, really), fund the production, actually produce the show and then offer rewards a la Kickstarter.

While I’m not one to rain on a parade, this model is regrettably flawed. While Hollywood does indeed like to see the money, they generally like it to be their money, i.e. for them to keep. SMGO also doesn’t exactly specify how the funds are handled beyond ‘funding production’.

This is what the Veronica Mars Kickstarter has produced and it’s ugly. Major studios absolutely do not want to be involved with fan efforts for lots of reasons (mostly legal), hence their often tone deaf and arms reach approach to the fan communities. The PR disasters that could happen are another reason. Say an SMGO-funded show did make it to production, and the results were dire. Who’s to blame then? Fan’s won’t want to hear the truth and it could destroy their loyalty. If you were Warners and you had to choose between letting your shows die a death or attempt a potentially disastrous comeback, the former is always much more appealing.

We haven’t even gotten as far as the real money issue: profit. Hollywood doesn’t like to make small profits (they’re too mundane.) They like to make BIG profits, especially on films, but also on TV shows. The latter aren’t publicised near as much, but a show has to make money otherwise it get’s canned.

Young Justice and Green Lantern apparently didn’t bring in as much dough as the network and studio would have liked, so they were sidelined in favour of some proven money spinners; Batman and Teen Titans.

The Truth To Saving A Beloved Show

So what’s to be done? SMGO is right in highlighting the need to factor in money into the fan revival equation, but it’s a half-effort. As I highlighted in this post, reviving a show is as much an art as it as a science. Networks need to know that:

  1. Their shows (and therefore advertisements) are being watched
  2. Any and all merchandise is selling (regardless of how good it actually is)
  3. People will continue to do both of the above in the future.

Doing all three is hard enough, but proving to the network that they are being done is the impossible task. I wrote about this a long time ago, and surprisingly enough, letter-writing still works, if done correctly.

While online petitions and services like SMGO are very efficient at gathering support, they fall down in the personal department. Individual letters still work wonders, but unfortunately they still require a herculean effort to pull off successfully.

Conclusion

The depressing aspect to the entire saga is that it is no different than all the campaigns that have gone before. Yes, it’s nice to appease fans, but any show that gets cancelled is bound to upset someone. It’s reasonable to attempt to save a show, but at some point you have to call it quits, and implying that you can (and should) never give up is a false illusion.

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Releasing Soundtracks of Animated Films Using SoundCloud

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Soundcloud 800x500_orange

The ongoing media revolution remains a fascinating thing to watch as it unfolds. Not only have we seen revolutions in video (YouTube), but also books (Amazon), shopping (eBay) and even shoes (Zappos)! Today though, we’re going to focus in on music, and specifically soundtracks to animated films and how SoundCloud could be a valuable tool for distributing them.

The Current Situation

Audio and music has been one of the areas that has undergone more upheaval than most. First Napster illustrated that tracks were preferable to albums (for most acts) and secondly the iPod illustrated that people wanted to take a lot of music with them, or at least have access to their entire collection. Lately, the shift has been towards streaming services; essentially ones where instead of buying the music, you subscribe to a service which lets you access it.

Both Spotify and Rdio provide streaming access to their vast libraries (this blogger has opted for the latter given its album-oriented approach as opposed to Spotify’s mass track listings) for about $5/month. Other services such as iTunes and Amazon allow you to buy tracks or albums rather than stream them, although Amazon is facing competition from Google in that regard.

Why Soundtracks Are Important

Soundtracks and scores are enjoyed by many animation fans. Indeed they have formed a significant part of many anime series and films for decades, with a pop song seemingly mandatory for any series or OVA.

Here in the west, that isn’t really the case, Sure, we’ve all seen the novelty albums put out (The Simpsons Sing the Blues seems to come immediately to mind) but actual soundtracks albums and scores seem to be the preserve of feature films only.

That’s unfortunate, because as the Avatar: The Last Airbender and The Legend of Korra series indicate, animated TV shows are perfectly capable of containing significant soundtracks and scores that are enjoyed by fans. The various petitions for an official release of both, perfectly illustrate that demand is out there.

Where SoundCloud Comes In

What is essentially the bone of contention, is that studios often don’t see the benefit to releasing an animated soundtrack officially. Even in Korra’s case, the cost of an official release could be well above what they could ever hope to make back in profit. Distribution isn’t necessarily the problem either. Disney have their soundtracks on both Spotify and Rdio.

SoundCloud is a similar service in so far as it allows listeners to stream music, but where it excels over Spotify and Rdio is in its social features. It permits embedding, sharing and following on a near-seamless level. The key here is that not only can users easily listen to music, they can discover new stuff too!

Not only that, SoundCloud promotes a collaborative community that encourages creators to release their material on the site and to remix others’ work. Even legendary producer Giorgio Moroder has a SoundCloud page where he has posted a sample of Donna Summers’ seminal song “I Need Love” for others to use.

A Theoretical Scenario

The distribution benefits are easy to see, but how could the other benefits play into an animated series or film? Well, simply posting tracks would allow fans to share the ones they like with their friends and followers; that’s simple exposure. That could easily draw in fans who hear the music before they see the animation. Although some would argue that that could never happen, consider the fact that people listen to far more media than watch during the average day; the reason being, naturally enough, that they are working or travelling when viewing isn’t possible.

So exposure is a plus. What else? Well, if you encourage remixing, then that opens up a whole host of new avenues. Theme tunes are an evergreen source of remixes that continually pop up despite most TV shows never releasing tracks at all! There are even remixes of remixes out there, proving that music is not a once-and-done form of artwork. SoundCloud doesn’t discriminate between tracks either, so it’s possible to put things like sound effects and voice tracks up as well. Just imagine if the legendary Hanna-Barbera library was available for all to listen to and play with!

Exposure? Great! Remixes? Superb. Now what? Well, it’s what underpins everything, that is, the connection with fans! The ability to directly communicate and interact with fans will be the engine that drives future content. Until now, it has been a one-way relationship. Sites like YouTube are instigating a two-way model, but too often, studios simply post the content and let the fans discuss it amongst themselves.

For a site like SoundCloud to work properly, interaction between the studio and fans will be necessary. Consider a fan who’s made a kick-ass remix of a track from a studio’s animated show or movie. The studio could easily endorse it somehow or even utilise it in a future episode. The goodwill cost to them would be nothing, but the payoff would do wonders for the creator and other fans.

Its Already In Practice!

cartoon hangover soundcloud

As usual, Frederator is ahead of the pack. Their Cartoon Hangover channel already has a SoundCloud page where lots of music has already been posted. Theme tunes, FX tracks and instrumentals are all available for SoundCloud users to listen to, remix and share as they please.

In the non-musical sense, both Skwigly and Cartoon Brew upload podcasts for the animation community to enjoy and share.

Conclusion

Soundtracks unfortunately occupy the fringes of animation production in terms of revenue. They’re a necessary part of production but far too often cannot be officially sold in a profitable manner (unless of course it’s a large Hollywood production). Lots of TV shows and smaller films have had their soundtracks languish in obscurity when they could be proliferating creativity.

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Kung Fu Panda Copyright Infringement Case Moves Forward

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kung fu panda - allmoviephoto

This week, the judge allowed a Kung Fu Panda copyright infringement case to move forward as there appears to be sufficient merit to the plaintiff’s claims that DreamWorks stole his idea for Kung Fu Panda and subsequently profited [greatly] from it.

The Facts

The Hollywood Reporter outlines in detail the background to the case in which Jayme Gordon alleges that the studio knew of his idea and developed it internally subsequent to sending him a rejection letter.

DreamWorks naturally filed for summary judgement; basically claiming that the case shouldn’t go to trial because the evidence already uncovered is enough to warrant a decision. The judge denied this for the reasons below.

Where Things Get Interesting (And Relevant)

The case has already gotten much farther along than similar cases but already there is the potential that all is not what it seems. The judge has noted that Gordon admitted destroying his original documents after compiling them into a pitch bible. While Gordon claims that “I make a practice to shred everything. If I make a new book, I shred the old stuff.” his actions are cause for alarm.

Such actions are tantamount to destruction of evidence. Gordon knew that such materials would likely prove his case but he destroyed them. While that certainly harms him, it also serves to derail the cause of justice on the part of DreamWorks. If the original materials were different enough to prove their innocence, then they stand to lose a lot of money.

Although its far too early in the case to call it for one side or the other, its disconcerting that Gordon doesn’t have a solid record of his work. He claims to have registered his work with the copyright office but his date of registration was only two days prior to the release of the film although he claims the works were created in 1999.

 

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Who Owns Kickstarter Projects?

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kickstarter
Via XKCD

This blog hasn’t been shy about Kickstarter in the past. It’s a great service and one that enables independent creators to fund their creations in an efficient and relatively risk-free manner. Of interest to us is the animation-related projects (naturally) and with the recent success of the Cyanide & Happiness campaign, there has been much to celebrate in that regard. That said, as with any successful service, the big boys eventually come knocking and that’s where the problems begin when it comes to determining who owns Kickstarter projects once their funded.

Backers Are Technically Investors

Think about it, if you put money towards something (tangible or not) you’re really investing in its success. Projects that aim to create a physical object generally offer said project as the reward for backing. Projects concerning content also tend to offer the content (or access to it) as rewards because (naturally) people who back something want to be able to see it too.

The problem is that content projects generally depend on lots of people watching it. Those lots of people won’t be backers, they’ll be members of the general public who heard or read about it from somewhere else. Since they have nothing to do with the original Kickstarter campaign, that essentially makes the original backers investors instead of donors. Concepts such as ownership of the completed works and the nature of any copyrights associated with them have so far gone unaddressed in many Kickstarter campaigns despite the fact that they are often a sore spot in traditional models.

How This Becomes Problematic

The impetus for this post comes from Dara Naraghi who commented on the recent Veronica Mars Kickstarter campaign. If you are not familiar, the gist is that major studio Warner Bros. ‘told’ the series creator that if they could raise $2 million, the studio would consider a feature film. Needless to say, that target was blown away within hours (its at $4 million as of writing).

Dara however, sees a massive problem :

First of all, allow me to congratulate Warner Bros. for being so incredibly generous to “allow” people to give them free money, with absolutely zero risk to the studio. What great movie making folks they are. And secondly, if the phrases “met with the Warner Bros. brass” and “they agreed to allow us to take this shot” make you feel confident that the movie studio is obligated, ethically and legally, to make this movie, then you’re either the world’s biggest optimist, or stupidest investor. Seriously.

He’s right too, but the problems extend far beyond the above attempt to make a film. In the past, if you put money towards a project, you were also (generally) entitled to a share of any profits generated (its one of the founding theories of capitalism). With Kickstarter, no such guarantees exist. Essentially once a film/series is funded, you (the backer) are no longer entitled to anything beyond what you were originally promised, and even then you may be left in the lurch.

Under certain circumstances, such a scenario is acceptable though. Think an independent animator who just wants to get their film onto DVD, or the comic artist who wants to publish a book.

Those kinds of campaigns are different though as the content has already been created. The projects this post is concerned about are the ones whose goal is to fund the content itself. Problematic insofar as content tends to live on for quite a while and can generate revenue for decades after they are created. Is it really fair to the people who paid for it to see the money raised go straight into the pockets of the creators who essentially put up nothing besides the idea? (If you disagree, please by all means add a comment below.)

How This Can Lead to Abuses

While many people freely donate/invest knowing this, where it could potentially become a problem is when larger players get involved. Projects like the Cyanide and Happiness one are done by individuals with a strong connection to their fans and who gladly give the content away for free afterwards, but what if a major studio (such as Warners) did the same? Do you think they would make it freely available afterwards? Nope, not a chance. What about the money they would make from it, would that be distributed among the people who donate? Again, not a chance. Heck, Hollywood studios are already notorious for not even giving out the money their contractually obliged to. What hope to thousands of individuals have?

Naturally if you only throw $25-50 at a project chances are you won’t be too put out, but some campaigns have donors who pledge $10,000 or more! That’s certainly not a pledge but a true investment; even more so since they often come with a ‘producer’ credit.

How To Mitigate For Abuses of Kickstarter Backers

As you can probably tell, the issue here isn’t people receiving nothing, or people receiving little but rather people seeing their generosity taken advantage of. Independents keep this in mind, but larger studios certainly won’t. If Warners receives the Veronica Mars Kickstarter money, rest assured it will disappear into the black hole of development hell. Why? Because it’s 100% profit for them and having $4 million in their hands is worth a heck of a lot more than a potential $100 million box office.

The simplest and most effective way to mitigate is to simply let the content created roam free either in the public domain or (more sensibly) under a Creative Commons license. Put simply, the latter does not prohibit creators from making money, but does not preclude investors from enjoying and sharing it either.

What Do You Think?

Lastly, I want to hear what you think. Time pressures meant I was unable to contact and query the people I wanted to before writing this post, so I’m eager to hear what you think. Would you feel cheated/angry if a Kickstarter project made lots of money after you backed it? How about being told you can no longer enjoy it thanks to copyright restrictions?

Leave a comment below and feel free to share this post too!

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Equestria Girls Breaks The Law Of Brand Extension

6 Comments / Business Models /

One of the truths about success is that the impulse to fiddle with it always overrules the wisdom of leaving it alone. No sooner has an animated show achieved critical acclaim and commercial success than ideas are hatched to parlay that success into something else. Today’s topic represents the epitome of the concept of ‘brand extension‘, where a successful brand in one area is transplanted into another. Think of the Disney cruise ships as being an extension of the theme parks. The former plays off the positive public image of the latter despite no real connection to it besides a common owner.

Via: Derpy Hooves News
Via: Derpy Hooves News

The proposed Equestria Girls animated TV show is just such an extension. It takes the wildly popular My Little Pony: Friendship is Magic and attempts to transplant it from a show based on ponies to one based on human characters. The move is being spun as a celebration of the toy line’s 30th anniversary and will take the form of a series.

Why Equestria Girls Raises Concerns

So what’s the deal with it; why should it matter? Well, brand extension is inadvisable for a number of reasons. Chief among them is that the very hope that customers will follow has been proven again and again to be false. This belief can even be a double-edged sword in the case of a poor extension attempt. Not only is there the risk of failure, but also the risk that the contamination can spread back to the originating brand.

In the case of My Little Pony, this could mean that if audiences reject Equestria Girls, then they may also stop watching My Little Pony: Friendship is Magic, buying the associated merchandise and attending the various conventions. So far, both The Hub and Hasbro have been extremely accommodating of fans (despite some hiccups) but this attempt was clearly initiated without any concern for them.

Why Its Being Attempted

Efforts like Equestria Girls are often symptoms that studios or networks are becoming risk averse. In other words, they don’t want to take the chance that a new venture may fail so they rely instead on variations of an existing success story. The risk is certainly lower, but the risk that the brand itself will wear out quicker is a major conern.

At the time of writing (March 2013) the MLP brand shows no signs of slowing down, but the inevitable slowdown is coming sooner rather than later. The Hub (or rather Hasbro) is sowing the seeds for the efforts to keep the brand afloat with Equestria Girls.

We’ll have to wait until later this year to find out how things go, but as of now, Hasbro is willing to take a chance with their most valuable property.

 

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Oh My Disney: When Fandom Goes Corporate

3 Comments / Business Models /

Oh My Disney screenshot

Sprung up over the past month is a new website that deals with everything Disney, and in ways that are familiar to many fans out there. GIFs, top 10 lists of things, and other silly posts that appeal to the funnier side of Disney characters and films (for example, Damsels Not In Distress). However, for all the joviality, there is something that appears slightly off about Oh My Disney, which is not surprising since it’s the corporation itself that’s calling the shots.

The Indicators

If you visit the site, everything appears innocently enough:

Oh My Disney Lion King ad screenshot1

Sure the Disney Company makes no attempt to hide the corporate signage, but it doesn’t display them as prominently as you might expect them to either.

The posts themselves look appealing, even enticing with such titles as:

and

But what’s this, right at the top?

Fantasy Bachelorette: The Lion King Edition

O…K… Maybe a contributor is a bit of a fan of that godawful show?

Nope:

With another round of The Bachelor coming to a close today (at 8|7c on ABC), we found ourselves asking the question on everyone’s mind: Who would win if all The Lion King men were pitted against one another on The Bachelorette?

Hmmm, that’s an all-too-subtle-yet-painfully-obvious “hint” that the show is on ABC tonight isn’t it? How many fan sites do you know crow about other properties within the Disney empire in such a blatant display of corporate synergy? Well, uh, none. (No, the ‘advertisement’ flags don’t count, they’re so ubiquitous on the web these days, they blend into the background.)

A bit further down the page we get the marketing schtick for the latest Oz movie that [oh so conveniently] just hit cinemas here in the US.

These blatant promotional posts are not slammed down users’ throats, but they are dispersed just enough to make them appear to be of similar thread than the less serious ones.

The Problems With The Oh My Disney Model

It would be all to easy to point out and discuss the rash of commercial posts on the site, but that would be the obvious (and therefore, easy) choice. No, what Oh My Disney represents is a company attempting to subvert the very fan culture and trust that sustains it.

You see, fans and fandom help support studios, but more often than not, they reside outside of the studios control. Sure, there is some communication (one-way most of the time) but if a studio tries to pull the rope, fandoms can react in the most unpredictable ways (just look at how many ‘reboots’ have been needed over the years.)

With Oh My Disney, the company is attempting to, not so much manufacture, but certainly to control how fans interact with the company and its content. It is trying to not only dictate which content is appropriate, but it is also attempting to dictate how fans react with it.

Just look at the Lion King post, who the heck isn’t going to click on that? Everyone likes the Lion King (except me). The same goes for all the other ‘original’ posts that give fans a few golden nuggets of joy.

The problem is that OMD remains a corporate entity, and thus, it also retains the one-way communication. You can share posts wherever you want, but if you disagree, you won’t be able to air your dissatisfaction on Disney’s website.

Ultimately, Oh My Disney subverts fandom because it strives to prove that the company itself can do it better. That they can create better, funnier posts and that they can sneak in some advertising while they’re at it. That’s a betrayal of fan’s trust, who have already been doing so for years without any help and still remaining loyal to the company.

How are they expected to feel when they learn that not only is Disney muscling in on their turf, they’re trying to sell to them as well? You know the answer as well as I do. At the end of the day, it’s dishonest, but then what else are we to expect from Disney these days.

The Alternatives

These should be pretty obvious, but just about everywhere not connected to the Disney Company. They’ll even be real fans, just like you on the other side of the computer screen doing it for the love, not a marketing employee doing it for the money.

Is Oh My Disney a corporate wolf in sheep’s clothing? Let us know with a comment!

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