As a regular writer of articles about movies, I find that many people ask, “How do movies make money?” I also found that many people have many misconceptions about how movies actually make money. I hope to clear up many of these misconceptions here so that you know the real ways that movies make money.
How Movies Make Money – Ticket Sales
The primary way that movies make money is through theater ticket sales. While there are exceptions (like moviess that blew up in DVD sales after flopping), the average movie going to make more money per ticket which we bought at our local movie complex.
A common misconception is that only a small portion of movie tickets are actually sold to moviegoers. This is not true. In fact, a small amount of ticket sales go to the theater. Movie theater make the most of the grants.
How Movies Make Money – DVD Sales
The next big hit for movie studios would come in the form of DVD sales. While movie studios might only make a handful of dollars from each DVD sale, the number quickly increases as some movies are sold in the millions.
How Movies Make Money – Marketing
We can all thank George Lucas for being the father of movie marketing. There were three small films that he made in the 1970s and 1980s that gave us characters like Luke Skywalker and Darth Vader that opened the door business developer
When you’re talking about blockbuster movies and children movies, chances are good that more money will be made from the merchandise than the deposit. DVD sales, or any other medium than the original ticket. Movie marketing has become a multi-billion dollar industry that makes many movie fans laugh all the way to the bank.
How Movies Make Money – TV
When a movie is shown on TV, chances are good that the movie studio either sold the rights to the movie, is paid a flat fee for showing the movie, or is paid a percentage of the commercials. Many consider this the best type of residual payout for a movie.
How Movies Make Money – On Demand
When you order a movie through On Demand, the movie studio will either make a percentage of the sale, or a flat fee already paid for the opportunity to be shown on Demand.
How Movies Don’t Make Money – Obsido
There has been a misconception for many years that movie producers make money from private movie funds. For the truth is the other way around. Private film investors pay a certain amount of money to make a film. Before the studio makes money, it is more important to invest to restore its original interest, or to take a percentage of the overall film.
How Movies Don’t Make Money – I Sell Movies
When you see a movie character wearing a T-shirt, driving around in a Ford truck, the movie studio isn’t advertising any of that profit. Money was put back into the film to either limit or increase special effects or marketing.
The next time you hear people talking about how movies make money, keep this in mind. You may be surprised how few people know where the money goes, who has become an outcast in the middle of their entertainment.
