With “Valerian and the City of a Thousand Planets” becoming the latest big-budget bomb at the box office this weekend, opening to $17 million against its $209 million budget, it got me thinking. How much is too much for a film to cost? What films should get the six digit budgets and moreover what goes into a film being successful to not only earn back its production budget but also turn a profit? So I decided to do this write-up, looking at what sort of films typically tank and which thrive at the box office, and what should studios do to avoid the bombs and strike gold.
NOTE: I will predominantly be looking at this from an American perspective, as that is still the world’s biggest film market and where studios aim to succeed, however foreign figures will be factored in.
What goes into a film’s budget?
Everything besides marketing goes into the cost of a film’s announced budget. So that is factoring in everything from the very start, the cost of the writers (usually around 5%), to things in post (typically also 5%). In between you have actors, directors and producers taking home paychecks (more on them in a second), and actual production costs which typically run about 33% of the reported budget. A film like “Spider-Man 2” will cost $200 million to make, with $30 million going to the cast, $30 million going to the script and story rights, $45 million going to actual production and $65 million going towards special effects. However on some occasions the screenwriters, directors, producers and actors take up a huge chunk of the budget, as is the case with many Marvel films, including the new “Avengers” films, where the group is set to make $400 million, with Robert Downey Jr. making $200 million for the two “Infinity Wars” films alone. It should be noted that Hollywood is extremely secretive with their budgets, and all-too-often a film will be announced at one price but actually cost way more, like that infamous 2003 bomb “Gigli,” which was reportedly made for (an already too expensive for a romcom) $54 million but actually cost $75 million.
What films cost over $100 million?
Typically, films that cost over $100 million are tentpoles, which nowadays means superhero films. However on rare occasions, studios (inexplicably) give triple digits to non-established franchises and it rarely works out. Ridley Scott, who I praise for making great looking films on “small” budgets (“Alien: Covenant” cost only $97 million), has a quote I love, “when you’re spending $250 million on a movie, you should have been fired a year ago.” You look at films like “King Arthur: Legend of the Sword,” a film that cost $175 million to make but ended up grossing just $140 million worldwide (and an abysmal $39 million in North America). A film like that, an age-old tale that people have seen a dozen times and in a genre (medieval) that doesn’t usually scream “box office results,” should cost around $65 million, tops. That is enough for the film to look good and land you one or two big name stars. If people show up (and you make a good quality product of which this film was not), then you will establish a fanbase for a sequel. Instead, Warner Bros. gave Guy Richie, a director with a history of making busts, a budget larger than that of “Doctor Strange,” “The Jungle Book” and “Beauty and the Beast,” all of which turned massive profits (whereas “King Arthur” is slated to lost $75 million), and he cast Charlie Hunnam in the lead role, a man who won’t bring butts to seats. And then there’s “Valerian,” which cost $209 million to make (by definition the most expensive indie ever made since director Luc Besson did individual crowdsourcing and personally funded the project). The fact that this cost more than “Spider-Man: Homecoming” and “Rogue One: A Star Wars Story” is asinine and the film almost deserves to tank. When a film costs $200 million, it typically means that it needs to gross around $500 million worldwide to breakeven, of which “Valerian” will not come close to doing.
But at least you could bill “King Arthur” and “Valerian” as big-budget blockbusters, so there’s the argument that they can translate and transcend languages and be seen and sold to many worldwide (which “Arthur” clearly did, as it make $100 million outside North America). But then there are films that should cost nowhere near $100 million. “The Campaign,” that not-too-bad Will Ferrell/Zach Galifinakis joint from 2012, cost $95 million. Why? Beats me. Clearly the two actors have big quotes but the fact that the cost nearly $40 million more than a superhero film like “Deadpool” and nearly 4x Ferrell’s “Anchorman” is astounding (in fact, Ferrell has a history of having his films costing too much, “Daddy’s Home” needed $69 million).
So to summarize: most of the time it is the established franchises that get over $100 million, but every now and again a newbie slips through the cracks, and it almost always ends in a flop.
What Causes a Flop?
While the old saying “it takes money to make money” is true, you also have to be smart about it. People, at least Americans, show up to movies typically because of two things: word of mouth and actors on the poster. In the age of Rotten Tomatoes, critics have the power to stop a film before it can even get off the ground, but in the end it is audience reactions that affect a film’s legs and multiplier at the box office. A film like “Pirates of the Caribbean: Dead Men Tell No Tales” can get poor reviews from critics and a good response from fans, but it is the critics who win out (that film has done OK worldwide with a gross of $767 million, but underperformed at home). Conversely, a film like “It Comes at Night” can get glowing reviews from critics (87% on RT) but when audiences hate it (a D+ CinemaScore), the film will stop dead in its tracks. Then there are examples of both critics and audiences blasting a film and it implodes upon itself, like “The Mummy” or “Fantastic Four.” Both films had initial opening projections of around $50 million, but after critics panned them it lowered the amount of people who went to see the film’s opening day, and after they hated the films too and told friends to stay away, both films opened to around $30 million and couldn’t even crawl towards a final domestic gross of $80 million.
Basically, if you make a good movie, it typically won’t flop. It may underperform but it will rarely lose you money. When studios get involved in the creative aspect of filmmaking and give directors instructions of what must be in them, that is when films suffer, and box office returns follow suit. “The Mummy” was one big checklist for building Universal’s “Dark Universe” and it showed; the film is messy, choppy and barely its own story. Similarly, “Batman v Superman,” one of the most anticipated films of all-time, made “only” $870 million and had one of the biggest second weekend drops ever for a blockbuster because Warner Bros. insisted Zach Snyder set up the “Justice League.” The only reason the film turned a profit was because it (1) faced little competition in March/April and (2) had two of the biggest and most marketable characters ever made to sell pre-sale tickets. And of course there’s “The Amazing Spider-Man 2,” a film so full of forced plot points to set up a third film and a “Sinister Six” spinoff and include as many Sony products as possible that it literally made people hate the series so much that they gave the rights back to Marvel (and “Spider-Man: Homecoming” ended up making more in the US in its first two weeks than “TASM2” made in its entire theatrical run).
So What Films Should Cost What?
There is no exact formula to create a profitable film and it all circles back to if you make a good, fun movie then people will come, but for your film to be successful, you usually need a star. There have been a few “studies” done, and the only actor who time and time again has proven to result in positive box office receipts is Denzel Washington. Every other person you hear is a “star” is still hit-and-miss, but your film is dead in the water without one (typically). Even the most paid actors like Will Smith and Robert Downey Jr. have a “Concussion” or “Judge” for every “Suicide Squad” and “Iron Man 3.” And occasionally films like “Get Out” will thrive despite the biggest name being Bradley Whitford, but that goes back to both critics and audiences loving a good movie (it made $252 million against a microbudget of $4.5 million).
Comedies should never cost over $35 million. They are the most risky genre right now, because while films like “Valerian” may not be the best written things in the world, at least they look good and can distract you. Nowadays you can go onto YouTube or turn on the TV and get comedy skits and shows for free, so why would I leave my house and pay $12 to risk not laughing? Films like “The House” cost $40 million and have the star power of Will Ferrell and Amy Poehler, but it all goes back to critics and audiences, and neither liked this film, which currently sits at a global haul of $30 million, following Ferrell’s lowest opening of his career. Conversely, films like “Girls Trip” cost $19 million and get great critical reviews (89% on RT) and are in-turn loved by audiences (A+ CinemaScore) and open to $30 million. It also helps that film was made by and for African American women, a demo not nearly represented enough by Hollywood. And Tyler Perry makes his Madea movies for $20 million, they open to $30 and leg out to $60. Easy $15 million profit.
We kind of already touched on action films and blockbusters, but typically you should never give a non-franchise film over $100 million, the risks and need for return are just too high. Even “Transformers 5” cost a reported $217 million ($260 million if you believe sources) and that is doing “horrible” and is going to finish around $570 million worldwide, far below initial $900 million expectations. People didn’t care about that series anymore, so for Paramount to give Michael Bay that much money and not demand a good film in return is their own fault.
Dramas need stars but also need to look entertaining, and typically shouldn’t cost over $45 million at most. “All Eyez on Me,” the Tupac biopic from this past June, cost $40 million and got destroyed by critics. It had a surprising opening weekend with $26 million thanks to fans (who liked the film with an A- CinemaScore) but it plummeted at historic rates in the weeks to follow and ended with a total gross of $44 million, nowhere near what a film that opens near $30 million ends up at. “The Revenant” had Leonardo DiCaprio and wisely billed itself as an action film, so although it was mainly an art drama with more crawling that shooting, people turned out. Yes, the budget ballooned from $65 million to $135 million, but it ended up making $533 million thanks to good reviews, Oscar buzz and Leo, good for a $61 million profit. But being good isn’t enough, you have to look entertaining; not many people want to pay to go and be bored or depressed. So despite winning the Academy Award for Best Picture and having a 97% on Rotten Tomatoes, “Moonlight,” a film that cost $4 million and ended up making $65 million worldwide, made just $27 million in America; as good as many people probably assumed the movie was, not many have an interest in watching a gay black boy struggle to fit in and get bullied, the real world is hard enough to cope with as-is. The film turned a profit, but aside from “The Hurt Locker” which never cracked 600 theaters, you have to go back to 1987 to find the last Best Picture winner to gross under $70 million worldwide, and “Moonlight” is by far the lowest-grossing winner domestically of the last 40 years.
A film usually needs to earn about 4x its cost to turn a profit. So when “The Mummy” costs $125 million (or $195 million, according to insiders), that means that despite grossing nearly $400 million worldwide it will lose money. Just because you put money into a film doesn’t mean it will make all that money back, and studios best realize that fast. Also, making movies that are basically advertisements for future movies, like “Mummy,” “Amazing Spider-Man 2” and “Batman v Superman,” never ends well. Let filmmakers get back to making films, and keep budgets in check. And don’t be dumb with your money, studios; keep it away from the Michael Bays of the world.