Hollywood's friendship with Facebook is showing signs of
The entertainment industry was among the first to embrace the
Silicon Valley phenomenon. Studio executives thought the
giant social network held great promise in reaching
movie-goers for less money than traditional advertising such
as trailers and TV ads. Facebook's origins even became fodder
for the 2010 Academy Award-winning movie "The Social
These days, major studios are taking a hard look at the cost
of winning friends on Facebook. Some industry executives are
increasingly sceptical that Facebook ads and promotional
campaigns that ask users to "like" a movie can deliver big
"For people who are actually looking at the research and are
looking for return on investment, for metrics that indicate
specifically what Facebook's role is in the movie marketing
equation, the jury's still out," said Jim Gallagher, a movie
marketing consultant who formerly oversaw marketing for Walt
Fred Leach, Facebook's head of entertainment measurement,
said the company is working more closely than ever with
Hollywood studios to help them target the right audience for
a film, including giving studios more data showing the
connection between ads and movie ticket sales and more tools
to track the effectiveness of Facebook campaigns.
In Hollywood, few are openly critical of the world's biggest
social networking company.
"Facebook continues to be an important advertising partner,"
said Dwight Caines, president of worldwide digital marketing
at Sony Pictures Entertainment. "They are on every campaign
we do today."
But other film executives confide privately they are
considering cutting their spending on Facebook ads, just as
carmaker General Motors did last year, when the nation's
third-largest advertiser dropped its annual $US10 million
Facebook campaign after deciding the ads didn't help sell
The skirmish with Hollywood comes at a sensitive time for
Facebook. The company, under pressure from Wall Street to
grow revenue after its initial public stock offering in May,
is competing with other social media for a share of the
estimated $US1.5 billion a year each major studio spends
promoting movies globally.
Part of the problem is that studios are being asked to pay
for the exposure they once got for free.
For years, studios have set up Facebook fan pages to connect
with movie-goers, sending photos, video clips and other
updates to the news feed of users who "liked" a particular
film, at no cost to the studios.
Then, in September, Facebook made a change to the algorithm
that decides what users see in their news feed. Facebook says
it made the shift because users were tagging posts with
Major brands, including Hollywood studios, have seen a
dramatic decline in the number of fans who see their
For example, 72 percent of movies and network TV shows
experienced a drop in the number of people who saw new
Facebook posts after the new algorithm launched, according to
BlitzMetrics, a Facebook marketing firm that analysed 9
billion page posts generated over a 60-day period before and
after the change.
That decline took a toll on two factors marketers watch
closely: reach and engagement.
Twenty-three percent of the biggest studio pages saw a
reduction in "engaged" users - people who click on a post,
share it with friends or write a comment - because of
decreased exposure in the News Feed, BlitzMetrics found.
The drop in "reach" - the number of people who saw these
updates from the most popular film and TV sites - was even
sharper: 45 percent.
The change in the algorithm coincided with a push from
Facebook to get studios to buy ads in the News Feed.
Social media experts say studios will have to find new ways
to appeal to users and interact with them more. Pages that
get a lot of likes and comments are favoured by Facebook's
Some studios are responding by bringing in their own writers
and production teams to help create more engaging campaigns.
Studios will also have to place ads to recapture the
attention of their audience on Facebook, the experts said.
"The days of free traffic are over," said Dennis Yu, founder
of BlitzMetrics. "Facebook has been trying to educate
marketers on how to be social - to post the most engaging
content - so as not to be penalised by their algorithms."
To be sure, movie studios haven't turned their backs on
Facebook and its 1 billion-plus users around the globe. Every
major holiday film - including Twilight: Breaking Dawn -
Part 2, Skyfall, Lincoln, The Hobbit: An
Unexpected Journey and Les Miserables - has a
splashy presence on the site.
Facebook's Leach said 99 percent of all films released this
year advertised on the social network, although he declined
to say how much the studios spent.
"There are so many people on Facebook, it is a good place to
have a presence - as a reminder. We buy the billboards in
Westwood too - a lot of traffic drives past those," one
marketing executive said of Los Angeles' Westwood
"It doesn't mean your film will not open if you don't have
that. The correlation is probably minimal. But when we're
opening a movie, we want to be in as many relevant places as
The executive spoke on condition of anonymity for fear of
At the same time, studios have been turning to the next
generation of social media players, including Twitter, Tumblr
and Pinterest, said Todd Steinman, chief executive of the
social media marketing agency M80.
"Nothing exists in a vacuum. You've got all these platforms
that have emerged," Steinman said. "Facebook is still the
behemoth, but for immediacy and for intelligence and for
market penetration, I think Twitter has probably surpassed it
as far as a marketing vehicle for movies that are coming
The evolution of Summit Entertainment's digital strategy over
the four-year run of the "Twilight" series is a case study in
how studios traverse digital platforms to keep up with a
movie's fan base.
For Twilight, the first film in the blockbuster
series, released in 2008, the studio focused on Myspace, the
dominant social network at that time. By the following year,
Facebook and Twitter both figured prominently in campaigns
for the first sequel, Twilight: New Moon.
With the final installment in the "Twilight" saga now in
theatres, Summit added two more digital outlets, letting fans
listen to and share music from all the films in the franchise
on online music service Spotify and encouraging them to pin
images from the film to personal pinboards on Pinterest for
their friends to see and share.
Still, Facebook dwarfs all of its competitors.
"When you are marketing a movie, you want to reach the widest
audience possible to get people talking about it," EMarketer
analyst Debra Williamson said. "Facebook still has that hands
down compared to Twitter."
'Social media marketing efforts are a drop in the promotional
bucket that splashes money on TV ads and movie trailers.
Kantar Media estimates studios spent nearly $US2.9 billion on
television ads in the U.S. alone in 2011.
Television commercials, in-theatre previews and word of mouth
remain the primary factors that influence a movie-goer's
decision to see a movie, according to Vincent Bruzzese,
president of Ipsos' Motion Picture Group.
"I still think (Facebook is) one of the most powerful
marketing inventions of all time," said Ben Carlson,
president of the research firm Fizziology, which uses social
media to forecast box-office results. "But it's not a
one-size-fits-all, write a cheque, and magic happens. It's
not a cure-all."
Questions about the role of Facebook in movie marketing
campaigns come at a time when studios are looking to cut
movie-making costs, including the film prints and advertising
expenses known in the industry by the shorthand term P&A.
Facebook is "a super-duper expensive piece of real estate,
and it's only one part of the old ball and chain of P&A,"
said veteran marketing executive Terry Press, co-president of
"It's not like you can do only Facebook. If you could open a
movie on Facebook, that's all you would have to buy. But it