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  • Volume vs. Value ● Digital Sales ● Volume? ● Need to have a lot of transactions to make a profit ● Hollywood can play the volume game

  • Success on VOD? ● Digital copies range from $9.99 - $19.99 ● Digital rentals range from $0.99 - $4.99 ● Earning $100,000 on VOD is considered a success ● How many transactions are required to be a success? ● 5,000 transactions for digital copies ● 25,000 - 100,000 transactions for digital rentals

  • Reality Bites ... ● 25,000 transactions doesn’t seem like a stretch for

    Hollywood studios … ● But what about the über indie filmmaker? ● The film without any “stars” or distribution? ● Can these über indie films generate 25,000

    transactions? ● Even if you did generate 25,000 transactions, does

    earning $50,000-$100,000 in revenue match your expectations in profits?

  • Reality Bites Even Harder ... ● Most indie films selling on VOD are only generating

    about 500-1,000 transactions ● Average earnings are about $1,000-$5,000 ● Why make a film for $50,000-$200,000 if your VOD

    earnings average $1,000-$5,000?

  • Starbucks Coffee ... ● $3.00 per coffee ● 4 Million cups sold per day ● Revenue = $12,000,000 per day ● Cost to make a cup of coffee = $2.00 ● Repeat customers

  • Movie Product ... ● $3.00 per rental ● 500 overall rentals ● Revenue = $1,500 overall ● Cost to make film = $250,000 ● One-off; No repeat customers

  • Value NOT Volume ● If über indie filmmakers are only generating 500-1,000

    transactions per film … ● Why sell it for $3.00? ● Indie filmmakers can’t compete in the volume game ● Compete in the “value” game ● But how?

  • The $100 Film Product ● If über indie filmmakers are only generating 500-1,000

    transactions in digital sales … ● Then increase the price from $3 to $100 ● $100 X 1,000 transactions = $100,000 ● But what sort of film product is worth $100?

  • 1,000 True Fans ● Kevin Kelly’s famous blog 1,000 True Fans ● Your film is an advertisement for something bigger ... ● The audience you target will tell you what is worth $100

    to them ... ● You only need to provide $100 value to 1,000 interested

    fans ...

    http://kk.org/thetechnium/2008/03/1000-true-fans/

  • Fat, Sick, and Nearly Dead

  • Michelle Phan

  • Michelle Phan ● 7,246,597 YouTube Subscribers ● 1% engagement ● 72,465 active subscribers ● $10/month beauty care package ● $10 x 72,465 = $724,650/month ● $8,695,800 annually ● $84 Million valuation (source)

    http://recode.net/2014/10/27/michelle-phan-youtube-star-to-startup-founder/

  • Napoleon Dynamite

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