Marvel Studios has created some of the oldest and most popular comic book characters in the entertainment industry, such as Spider-Man, the X-Men, the Hulk, Daredevil, the Punisher, the Fantastic Four, and Captain America. and Thor and many other superheroes. In August 2009, Disney acquired it for US$4 billion.
Marvel is very confident about the operation of the IP industry. Its executives said: "We shape characters, arrange plots, carefully select partners, and provide quality-free products, but we do not provide any Funds...we are only responsible for collecting accounts. Marvel is a gold mine, and money will continue to flow in every day.”
In the 10 years from 1999 to 2009, Marvel executives published the company’s comics. It has become a money-making tool, and the toy and licensing business is booming. Marvel has licensed Spider-Man, Hulk, X-Men, Punisher and other characters to Sony, Universal Studios, 20th Century Fox, Lionsgate and other companies to produce 20 movies. Many of these films have recovered their costs only by the end of their domestic screenings in the United States, and subsequently achieved great box office success in the international market. In the US market alone, 14 films have exceeded US$100 million, 6 have exceeded US$200 million, and 4 The film grossed over US$300 million at the box office. Remarkably, the Marvel sequel is even better than the original. Along the way, Marvel's global revenue in the past 10 years has approached the US$7 billion mark.
In addition, Marvel has also conducted a series of licensing deals for video games, clothing, party supplies, food and many other peripheral products. “We create characters, develop plots, carefully select partners, and provide quality products, but we don’t provide any funds,” a Marvel executive told me. “We are only responsible for collecting the accounts. Marvel is rich. Mine, money will continue to flow in every day.”
At first, many people had many doubts about Marvel’s operating model. Others worry that Marvel has exhausted the revenue potential of its most well-known characters and may have no choice but to further promote lesser-known superheroes such as Ghost Rider, Iron Man, the Punisher and the Fantastic Four. It's stalled. But all kinds of doubts and uneasiness gradually dissipated with Marvel's successful IP operations. “There’s no end to our success—Marvel has so many comic book characters,” said Cuneo, the comics executive, though he admitted of the company’s relatively meager box-office cut that “the thought of us giving it away For example, although "Spider-Man" hit a staggering global box office of 820 million U.S. dollars and sold 7 million DVDs priced at 20 U.S. dollars on the day it was released in the United States, Marvel finally It only received a share of US$25 million from Sony. “We’ve always been focused on minimizing capital investment,” Cuneo said, “but if Marvel wants to increase its control over content production and distribution, it has to raise its stakes — and the benefits may be greater. "More"
In 2005, Marvel took a solid first step towards this goal: it raised US$525 million from Merrill Lynch to start independently preparing movies and handed them over to Paramount for distribution. . According to the cooperation agreement, Marvel will produce 10 movies with an average budget of US$45 million to US$180 million over the next eight years. For each movie, Marvel will receive corresponding production funds and have the right to retain all sales proceeds, while Paramount will take an 8% distribution fee from the box office revenue each time. (The agreement also applies to movie sequels.) "Marvel has become a prestigious entertainment brand," Paramount Chairman and CEO Brad Gray said when the agreement was announced. "Its market influence We have witnessed the popularity of the film, brand and comic characters, so it is well-deserved to receive such creative financing for the film project. We are very excited to work with Marvel on this new journey. ”
Disney’s acquisition four years later once again confirmed Hollywood’s strong interest in Marvel’s popular characters and stories. In addition to the astonishingly high price, the acquisition contract also requires Disney to continue to fulfill existing agreements between Marvel and other studios, such as Sony's permanent rights to shoot Spider-Man (Marvel's most popular superhero)-themed movies, Paramount's Established deals for several other comic book characters, among others. But Disney is undeterred.
As Disney CEO Bob Iger said: "The huge treasure of more than 5,000 comic characters is enough for Disney to fully utilize its strengths."
The story of Marvel's 10-year turnaround It can be called the biggest counterattack in the entertainment industry and even the entire business circle. In fact, it is also a direct product of the major movie studios' search for hit new movies. New blockbusters based on Marvel characters have become the surest bet for Hollywood executives.
It is easy for people to think that Marvel first relied on luck to make "Spider-Man" popular, and then just relied on the afterglow of the previous work to survive. In fact, every movie studio executive knows very well that the first "Spider-Man" movie not only topped the box office in 2002 and was the tenth highest-grossing film in global history at that time, but also single-handedly made Sony's original A bleak year turned into something spectacular. As early as those years, Marvel had begun to rely heavily on this unprecedented hit. According to my estimation, if factors such as toys, media licensing and consumer product licensing are included, "Spider-Man" brought at least 50% of Marvel's operating income in 2002 and 2004. This proportion would have been even without "Spider-Man". ” series of new movies were launched in 2003, it also reached about 33%.
"Toys, clothing, school supplies, games, promotional items, pajamas, skateboards, vitamins, lollipops... As long as Spider-Man is around, there will be no lack of market products." Marvel 1 A consumer product licensing expert once told me. Cuneo also admitted: "Spider-Man is incomparable. He is our number one hero, and any peripheral product can attract the largest consumer group. From two-year-olds wearing Spider-Man pajamas to people in their 60s Buyer, everyone loves Spider-Man. I wish all our characters could be this popular."
The early success sparked a superhero craze. Following "Spider-Man", other Marvel movies such as "Daredevil", "X-Men 2" and "The Incredible Hulk" have achieved box office success, and the sequels of "X-Men" and "Blade" even surpassed their predecessors. Therefore, seeing the continuous emergence of long-lasting or what people in the industry call "full of staying power" works, the competition among Hollywood executives for Marvel characters who are expected to be put on the screen has entered an unprecedented stage of intense competition. According to the original agreement between "Blade" and "X-Men," Marvel could get a certain percentage of the profits from the studio after deducting all fees. However, these studios have their own unique way of calculating profits, so in the end, Marvel is left with a negligible amount - what Cuneo calls "Hollywood economics." Although there are not many early hits in hand, Marvel has been able to obtain a more favorable revenue share for itself. It can usually get 3% to 7% of box office revenue through blockbuster movies. For movie companies, this is still a drop in the bucket, but it is already a very obvious improvement.
At the same time, in order to alleviate the heaviest financial burden in the marketing process of blockbuster films, Marvel executives have specially created a model to reduce product development and advertising costs, that is, to transfer the costs to the character authorization objects, to the greatest extent possible. Cut your own expenses. Specifically, Marvel is like a small joint crossover company with divisions responsible for comic books, toys, media licensing and consumer product licensing. The Comics Department is responsible for creating characters and fleshing out stories, effectively serving as the company's R&D center or creative incubator. Because comic book publishing is relatively cheap and flexible, with printing costs usually only ranging from $10,000 to $20,000, this incubator is extremely efficient.
Marvel promotes its brand through cooperation with film companies. Licensing contracts with the relevant studios stipulate that Marvel does not pay production and marketing fees for the films. "Our films often receive $30 million to $80 million in advertising, so word of the film spreads like wildfire, giving the Marvel brand and specific characters global exposure," Cuneo said in explaining Marvel. Regarding the positive effects the brand has gained from this, he also said: "If you have seen our movies, you may want to read our comic books, want to play our video games, want to wear T-shirts with Marvel characters printed on them, want to buy Various other peripheral consumer goods.”
How does Marvel make money? Toy and consumer product sales are Marvel's largest source of revenue. In order to further expand sales, Marvel has completely withdrawn the merchandising rights of its characters despite the obvious reluctance of its film partners. Consumer product licensing was, and still is, a highly profitable business.
When Disney made the acquisition, Marvel's sales and publicity team responsible for coordinating all consumer products business only had a few sales and assistant staff, and a dozen backup legal and product inspection experts, so the cost was absolutely low. Based on the contract, regardless of the sales volume of the licensee's products, a minimum deposit should be paid to the property owner, and if the sales volume exceeds the guarantee amount, additional royalties will be paid. Therefore, the closer the comic character is to the plot of the blockbuster, the higher the minimum guarantee and royalty rate Marvel can obtain. No wonder Perlmutter calls it a "gold mine."
Marvel also manages its brand portfolio shrewdly. Hollywood studio executives and many other entertainment industry producers know all too well that making a brand strong doesn't happen overnight. In fact, every time there is a masterpiece like "Finding Nemo" that can impress countless audiences around the world with a single character, hundreds of "Shark Tale" and "Diego" will appear at the same time, with poor box office results. Marvel is lucky to have so many enduring characters and so many great story treasures to discover, and Cuneo acknowledges that. "We don't want to be an ordinary studio that spends all day working on movie ideas. Fortunately, those characters have already penetrated Marvel culture, giving us enough marketing advantages.