To Prime or not to Prime: TVOD vs SVOD in Indie Filmmaking

Trying to make back the money it costs to produce an independent film is hard.

People expect entertainment for free. Really, I should say “free” instead. Nothing is free, but it’s not normally something people pay for at the time of consuming the entertainment. They pay a monthly (Netflix, Hulu) or annual (Amazon) fee, but when they sit down to watch a movie or show, there’s no transaction. Youtube is free, social media is free, even TV is free, if you don’t count paying for cable or satellite, or dealing with advertising.

Studios spend millions on overcoming this expectation. It takes a big amount of interest to trigger someone buying a movie instead of just “netflixing” it. And, I have found, it takes a lot of interest to trigger the purchase or rental of an indie documentary.

My film has been in the TVOD window, or Transactional Video On Demand window- meaning people who want to watch it must buy or rent it. I’m considering when to move to the next widow, which is SVOD and AVOD, or Subscription VOD or Advertising Supported VOD. It’s a big decision because the difference in margins is pretty large. In TVOD the split between platform and filmmaker ranges from 50-90%, depending on platform. Amazon Video is 50%. So if you rent a movie for $2, the filmmaker gets $1. Amazon Prime royalties are paid by the amount of time watched. And that royalty varies based on a number of factors Amazon calls an engagement score.

Given its current engagement score on Amazon, my documentary would generate $0.05 per hour of streamed video. (Max possible is $0.10) So, I would be making right at $0.08 per viewing of my entire film. (If someone watches part of it, then the royalty will be adjusted.) That means to make more money from SVOD/Prime than rentals ($1) I would need to have my film viewed 12 times on Prime vs rented one time.

Sounds crazy right? How can anyone expect a movie to be viewed 12 times as much as it is rented just by making it available to Prime subscribers?

Part of my issue is that most of the initial rush of purchases have already happened. People who already know about the movie have already decided to buy or rent it. To generate more rentals or purchases I have to introduce someone to the movie and then get them interested enough to spend money on the transaction. I have to trigger someone to overcome their expectation of free entertainment. Opening the SVOD/AVOD window could bypass that, but will it generate revenue?

So, I did a little survey among my friends. These are people I can easily reach through organic means (not paid) on social media and email. I asked 5 simple questions. There was a definite trend.

I should mention this is far from a perfect or scientific survey. It’s a snapshot of what people I know think about watching independent films. It’s also a bit skewed by the number of filmmakers who are included in the survey, so keep that in mind when reading the results. I will break that down a bit more as the article goes on.

29 total responses.

Survey results with filmmakers included:

29 responses. 3 people had give money toward a crowdfunding campaign for film. 12 had been in or helped make a film. 14 had never been involved with film before.

96.5% use an SVOD service like Netflix, Amazon or Hulu.
75% did not use an AVOD platform, like Crackle or Tubi.

65% said they either had or were willing to spend money an indie film (TVOD)
27% said the either had or were willing to watch an indie film on a “free” streaming platform. (SVOD/AVOD)
92% are open to watching your movie, if they are interested.

75% said they would rather watch an indie film on SVOD/AVOD.

Then I took out all of the filmmakers in the survey, leaving 17 responses.

53% said they either had or were willing to spend money an indie film (TVOD)
41% said the either had or were willing to watch an indie film on a “free” streaming platform. (SVOD/AVOD)
94% of these non-filmmakers are open to watching your movie, if they are interested enough. (That’s up 2% from when looking at the responses with filmmakers included… Weird)

76% said they would rather watch an indie film on SVOD/AVOD.

OK, so what does that mean?

Not a lot of people watch AVOD. Almost everyone has an SVOD service.

A lot of people say they will buy or rent an indie film, if they are interested enough. But in both versions of the survey, basically 3/4 say they would prefer to watch it through SVOD/AVOD. That makes sense, right? I’m already paying for the subscription, it’s easy to just add it and watch.

So while more than half are willing to consider spending money on your movie, it’s always going to be easier to get people to watch in SVOD. And, especially among friends and family, you can capture those TVOD transactions early.

Bottom line: After the initial rush of purchases by your committed fans, open the film up to SVOD. This should trigger the next level of fans, who might watch but are hesitant to pay money to watch.

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Facebook Advertising for Filmmakers: Finding the right audience setting

I’ve been trying to crack the code on how to advertise my niche documentary via social media. Specifically, how to earn more money than expended on the ads. I am in the TVOD window, and am trying to generate rentals and purchases to recoup the cost of making the movie.

I recently tried the FB conversion funnel using my small social media following, and it didn’t work well. I used the same funnel with a larger audience for my work, and generated a 20% increase in attendance for an event. So the funnel works, but my audience was too small.

So I decided to run some experimental ads. Not full funnels, but trying audiences groupings to see what worked. My plan was to run a few days of brand awareness and then a few days of video interactions, and see what happens.

I tried 2 sets of audiences. I spent just $10 per ad set, so total buy was $40. Small, experiment.

My content was a specifically targeted video ad for the brand awareness, followed by a generic trailer for the video interaction week.

The first set was a super tiny, very targeted audience. About 1000 or so potential members.

Brand awareness ad had a reach of 429 with a frequency of 1.89, resulting in 809 impressions, and estimated ad recall of 40. 5 people clicked the link to my website.

Facebook can also track how much attention viewers pay during brand awareness campaigns. I saw 21.88% Attention Impressions, meaning 1 out of 5 people paused when scrolling by my ad. So, I’m hitting the right group. But is it big enough?

The next ad set for video interactions with the same, tiny audience saw a reach of 384, with 123 video view, and a frequency of 2.99, which means I had 1147 impressions. 15 people clicked the link to my website. I again had an estimated ad recall of 40 people, or 10.42%.

Seems like a good target, but the frequency of 2.99 for just a $10 buy is worrisome. A larger buy would see a higher frequency. Audience felt a bit small.

For the 2nd ad experiment, I used detailed targeting to select people who liked or interacted with 10 popular homeschooling websites. This provided an audience of about 370,000.

The percentages were about the same. Very similar in ad recall. Frequency was lower because it’s a larger audience pool. But the number of people factored into a much better reach.

For brand awareness as the goal, cost per impressions was half for the larger audience. For video views the cost was 25% of the smaller audience. Same trailer, the small audience played through 123 times, but for the larger audience, it played through 624 times.

Video view reach for the small audience was 384. Reach for the larger one was 1983. Both had the same budget. Both had same ad recall lift of about 10%. But because the audience was larger, the ad recall lift of 10% means 200 people recalled my trailer instead of just 40.

So, what does this mean?

I’ve been struggling to find the right sized audience to target. FB’s funnel is set up thinking you have a good sized audience to funnel people from brand awareness to interaction to sale. But my established FB/IG pages do not have that reach.

So I have been looking for an additional targeting measure. The first audience was too small. But this second one with 370,000 members seems like it is the right size. And every interaction was positive, with organic shares and recommendations to other people.

My next move is to run a special via Vimeo On Demand and shoot for traffic to the Vimeo page. (Since Vimeo isn’t my page cannot track actual conversions so it confuses the ad algorithms to try that).

So I’m spending $10 again but trying for conversions. In this case, leads generated by people clicking through my website to places they can buy or rent the film.

I am trying to find an audience pool large enough and reachable enough to generate sales greater than cost of advertising. I want to reach that awareness tipping point where enough people know about the film that it can organically see sales. We did not achieve that at launch. Frustrating when you know a film is well received by its target audience, but a big part of the target audience isn’t aware of it.

Distribber Bankrupt?

Back when I was first thinking about indie film distribution, I heard about Distribber. It was a well-known aggregator. That is, it was a company that could take an independent film without the power of a full distributor or studio, and ge it placed on outlets like iTunes, Netflix, Hulu, and a bunch of other places.

Distribber’s model was that you would pay them several hundred dollars and they would submit your film. If they didn’t get the movie onto the platform, then you got a partial refund. Later they added a maintenance fee for titles, to help pay for the ongoing work to process payment. Because the outlets would pay Distribber, not you. Then Distribber would get around to paying you.

If you could afford the up front fees, this model sounds great to filmmakers. One time payment, and then all the revenue comes to us.

But apparently the model has flaws. Just from the outside, it seems like you need a constant influx of new films to keep the doors open. You would need that new income. If things slow down or something bad happens, this house of card will topple. But a few years ago, no one was worried.

I opted not to use Distribber because I didn’t have the up front cash, and I didn’t know how long it would take to recoup that outlay of funds. I did a few direct deals with outlets, and decided to go with FilmHub to try to get places i cannot go myself. Currently I’m letting them place the movie with TVOD places in the US, and everywhere around the world. FilmHub has no upfront fees (except $1200 with iTunes…) and takes 20% of any revenue generated.

Fast forward to this week. Rumblings and rumors abound about Distribber. Recent leadership changes and lack of communication are alarming some filmmakers. Alex Ferrari from Indie Film Hustle used to be a big proponent of Distribber. This week he came out and basically said he believed they are bankrupt. He received emails from Distrbber staff advising him to try to place fins using other means. And he sad he personally has thousands of dollars tied up with Distribber. They told him any refunds or payments will be handled through a 3rd party company during their “reorganization” which is often legalese for bankruptcy.

To my knowledge, Distribber has not said anything publicly about this.

Distribber’s website is live, but when you try to submit a film you get a message saying they are no longer accepting any new “orders”.

I don’t know how this will shake out. Any film submitted to a platform through Distribber will still be live and, until Distribber removes those titles, filmmakers are stuck. They cannot resubmit or remove the titles themselves. And they likely won’t get paid. At least not any time soon, if at all.

Business is a risk, and bankruptcy stinks for everyone involved.

My advice, such as it is- make deals directly with platforms and outlets as much as you can. It’s more work, but you limit your exposure. I only use aggregates to reach places i can’t on my own.

If indie filmmaking was easy everyone would do it.