Wednesday, 27 May 2009

Hollywood Babble On & On #292: Marketing & Free Markets

Despite record breaking box-office tallies the major studios are asking the marketing firms that handle trailers and advertising to take some pretty major cuts. In response the marketers made this video: (ht Nikki Finke)

If they wanted to make the video more in keeping with the real situation, the people trying to get out of paying for what they want should tell the vendors that they want to keep the money so Grampa, the CEO of the family so to speak, can piss it all away on slot machines.

This whole affair, and this video specifically, illustrates that the people who run Hollywood don't know the first thing about real capitalism.

First, in a truly free market, free of fraud a coercion, the price that's available is what the market can bear. Now some have a little wiggle room for haggling, but that's rare, and even then it's not much wiggle room. The object costs because that's what it costs.

Second is that capitalism is the only system designed to give both sides of every deal what they want. Because in a capitalist system without fraud and coercion everyone is supposed to walk away happy. The buyer gets what they wanted, and the vendor got a good price for what they were selling.

It's simple logic really.

However, this is Hollywood we're talking about, and logic doesn't hold sway in this magical little kingdom.

In Hollywood all business is based on fraud and coercion. From tricking people into signing for a piece of the net, which is never seen, to bullying suppliers with the threat of starting their own internal marketing departments to drive them out of business.

Which takes me to the second stupid thing about this situation.

The marketing agencies that the studios are currently feuding with, were created because the studios didn't like paying so much for running their own marketing departments and shut them down in favour of cheaper freelance contractors.

It's the circle of stupid.

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