Digital platforms are rapidly disrupting multiple industries—particularly television and movies. Studios that are part of these decades-old sectors must adapt to the changing environment to fit with how younger generations are consuming content. That means connecting the creative side of the entertainment business and marketing to develop content from the ground up to target specific demographics across digital platforms such as iTunes or Netflix instead of theaters.
John Baldecchi, a veteran of the film industry, is developing strategies for taking on the digital market. He is the CEO of Digital Riot Media, a global entertainment company that specializes in films that are specifically targeted at millennials and Gen Z audiences and focused around digital media platforms.
“We think of what we do as ‘tech-enabled,’ meaning that we’re looking at a lot of data to highly target audiences and adjust budgets based on who we think the audience is,” Baldecchi said. “We’re using data to figure out how we can be more efficient at marketing and focus on audiences. We’re in a world where data can work with the creative as opposed to stepping on it.”
The company’s first film was the direct-to-digital release FML, a comedy about an aging comedian who goes on a road trip with a social media star on a quest to gain a million followers and become relevant again. More recently, the studio released Happy Death Day on Friday the 13th in October with Universal Pictures. The horror movie is about a self-centered college student who keeps reliving her birthday as she tries to uncover her murderer.
Although both films are radically different in their distribution and marketing, they represent how Digital Riot is adapting to the changing shift in balance between theatrical and digital releases. Happy Death Day was originally meant for a digital release, but Universal decided it would be better to go with a theatrical one. Baldecchi said that theatrical releases and access to Universal’s worldwide distribution lends a lot of credibility to movies, and given budget considerations, he would rather make theatrical releases than digital ones. But the theater model doesn’t make sense for independently financed and distributed films.
“We like to keep our options open and remain flexible, [looking at] the distribution means and the technology that’s changing how we look at the world,” said Baldecchi.
Baldecchi said that the idea for Digital Riot’s approach came from observing his daughters and how they were fixed to their iPads, refusing to watch on larger TV screens. That led to creating content that is economically designed with platforms in mind first, with the marketing following accordingly. He says the goal is to deliver content to wherever they feel most comfortable, not necessarily to get them out to theaters. It’s the friction point of getting people out of their homes and spending extra money that’s causing many studios trouble.
According to Baldecchi, the first step is to talk to millennials, particularly those employed by the studio, to find out what content is relevant to them and their friends in order to “tap into the ideas that are in the zeitgeist.” The company then runs a sentiment analysis around different ideas to develop around them. Afterward, the data that was used to create the content goes into marketing toward specific audiences.
Baldecchi said that this collaboration between creation and marketing is different from the traditional approach because usually, “people want marketing dollars spent before you show up. Unless it’s premiering on a streaming platform, a lot of people like ad dollars spent before they get their hands on a movie.”
He also said that marketing needs to think about targeting demographic subcategories because “millennials and Gen Z” can be too big of a category to take on. Instead, he recommends looking to specific groups such as females between ages 15-and-20.
However, Baldecchi noted that there is a significant trade-off, in that the targeted audience is smaller than that of a theatrical release—and a smaller audience means a smaller budget. It’s the opposite approach of a theatrical releases, which aim to bring as many people as possible into theaters. Over time, said Baldecchi, targeting sub demographics means that digital platforms will increasingly grow to serve niche audiences.
Baldecchi believes, as many others do, that most people will eventually rely completely on streaming platforms for content and it will become increasingly harder to get people to theaters. But theaters will maintain a robust place in entertainment as events that feature specific directors, actors, ideas or IPs. Meanwhile, as platforms such as Amazon Prime Video, Netflix and Hulu continue to make original content, more studios will seek to fill the remaining niches in the market.
“I celebrate that there are mainstream platforms that are all about scale and are taking over the world, and then you have the more niche businesses,” said Baldecchi. “That feels right to me, and we want to do business with all of them.”
Another issue is that discovery becomes a major hurdle. With FML, Digital Riot relied on the cast and crew’s large social following and used them as marketing vehicles in addition to supporting the movie through ad dollars. The process of getting audiences to purchase the movie required even more pushing.
“It’s a combination of a straight ad buy—kids who are interested in ‘out there’ proselytizing—and a lot of marketing support,” said Baldecchi. “There’s no magic formula, it’s just more focused.”
“There’s no magic formula, it’s just more focused.” — John Baldecchi, CEO of Digital Riot Media
Baldecchi said that close attention needs to be paid to what sites and products customers are coming from and where they’re going to understand their tastes and preferences. Furthermore, he stated that having people generally like the movie may be beneficial to marketing, but more so on the traditional side than the digital one.
“Obviously, the more marketing money, the more luck you’re going to have,” Baldecchi added. “Marketing is always the hardest part, and clever campaigns will take into account dates and titles. They’re critical to the success of the project.”
Although Baldecchi supports the idea of day-and-date releases, where movies simultaneously launch in theaters and digitally, he sees it as a purely digital strategy than a compromise between theatrical and at-home releases. He stated that they mainly benefit smaller films where the theater numbers are less meaningful than the rental and purchase revenues.
In addition to making films, the company is also developing a digital episodic series, but the digital space isn’t limited to TV and film, as Digital Riot is finding opportunities in the app market. The company is advising entertainment company MSM Corporation International Limited (MSMCI) on the Megastar talent competition app, which features musician Usher Raymond as its creative lead and one of the judges.
Megastar is both a mobile app and months-long global talent competition, where singers, dancers and contestants of all types compete for a $1 million grand prize. Contestants submit videos through YouTube while app users vote, follow and tip them in hopes that they’ll make it to the livestreamed finale. Some of those contestants may end up in a Digital Riot project.
Although Digital Riot’s role is strictly advisory in helping to bring in talent and judges, Baldecchi observed that app marketing is very different from movie marketing. Megastar launched with prominent placing on the iTunes App Store, which was a major marketing move. Baldecchi sees some similarities between launching digital films and apps, in that audiences won’t come or stick around if the experience is bad. But that’s where the comparisons end, as apps can be improved post launch while most films cannot.
“[Megastar’s] version of marketing is our version of releasing,” said Baldecchi. “The parallels are that marketing in the App Store is akin to global marketing for a movie once it’s been released. The quality of the product is analogous to the quality of the movie.”
