Oscars: Reports of Its Death Greatly Exaggerated

There are those who pronounce every year that the Oscars are dead or dying, a dinosauric remnant of an earlier age when men were men and movies mattered. In addition, they think the show itself too long, too boring, too traditional, not traditional enough, too reverent, too flip, too uninclusive, too PC, etc, ad nauseum.

I personally enjoy the show (more or less) on its own terms, appreciate the convenient roundup of the year’s best films in one place and at one time, and am glad there are still a few focal points left for the culture as a whole in this era of mass fragmentation.

The Wharton School agrees:

According to Nelson Gayton, managing director of Wharton’s new Media and Entertainment Center and a general partner in Crayon Venture Partners, even with the proliferation of film award shows like the Golden Globe Awards, the Screen Actors Guild Awards and the British Academy Film Awards (better known as the BAFTAs), the Academy Awards spectacle holds its own. “In a day and age when there are so many shows out there, the Oscar brand still finds a way to distinguish itself. The Oscar is always the Oscar. It has stood the test of time.”

Statistics show that in January, 16.8 million viewers tuned in to watch the Golden Globes, 40% less than the year before and far below this year’s 41.5 million Oscar viewers. “The [Oscar] has history behind it that still has legitimacy,” Gayton added. “There is still something to be said about being an ‘Oscar Winner.’ When I think of all the awards out there, the Oscar is that validation that you are being recognized by your peers as being the best of the best.”

Wharton marketing professor David C. Schmittlein agrees. “Ask yourself: if you are going to watch one awards show, which one would you watch? I don’t think the relative position [of the Oscars] has been challenged.”

….Schmittlein argues that the “gnashing of teeth about the trajectory of viewers” for the Oscars show doesn’t detract from the reality that the Academy Awards is “the signature award program as viewed by the general public. Other award shows are interesting and will get substantial viewership, but they don’t challenge the Academy Awards for the preeminent position.”

As proof, Schmittlein points to the cost of a typical 30-second advertising spot during the Oscars broadcast: $1.6 million per half-minute (up from $1.5 million last year), second only to the Super Bowl’s $2.4-million price tag for a similar spot. Although the Oscars’ commercials don’t carry the hype and expectations of new advertisements running during the Super Bowl, Disney-owned ABC sold out all 48 commercial slots for the Oscars program.

“Why do advertisers pay so much money for a typical 30-second spot during this telecast?” Schmittlein asked. Sure, advertisers are looking for “eyeballs,” or massive audiences, and Oscars’ 41.5 million viewers represent the second highest-rated night of the year, after the Super Bowl. “But it isn’t primarily for the audience size or the demographics. It is because there are so few places any more in the measured media where an advertiser can put a message in front of a very substantial fraction of, in this case, the North American population at one time. You have the Super Bowl, the Olympics (but only every four years), perhaps the World Series and the Academy Awards. It’s supply and demand. There are not that many opportunities. If the numbers [of Oscars viewers] drop by another 10%, the show is still head and shoulders above the others.”

Furthermore, despite the relatively poor post-Oscars box office up-tick for this year’s winner Million Dollar Baby [Although it won Oscars for Best Picture, Best Director, Best Actress and Best Supporting Actor, the Clint Eastwood boxing movie realized a modest 11% box office increase, taking in just over $8 million during a weekend that witnessed the $30 million opening of The Pacifier], the Oscar luster nearly always plays out financially for both Oscar winners and Oscar nominees, said Timothy Corrigan, University of Pennsylvania professor of English and cinema studies. “Being nominated for an Oscar and winning it is worth a lot of money,” he noted, quoting estimated industry figures. “If you get nominated, that will add another $8 million to your receipts. If you win, it just keeps getting better.” According to Corrigan, the estimated box office increase for Best Picture is $18 million, with a $6 million increase for Best Actor or Best Actress.

“The financial luster is so desirable,” Corrigan added, that it drives the studios to campaign aggressively for nominations, often spending millions of dollars to push their product. And the payoff is not only at the box office, but through DVD rentals and foreign releases. “Even major successes that win the Oscar are promotional runs for DVD sales,” he said. “That’s where the money will be made, where even a movie that might not have had critical success can become a financial success.”

….Both Corrigan and Wharton marketing professor David J. Reibstein pointed out that naming Chris Rock to host the Oscars was a very obvious attempt to attract a younger viewing audience. After all, noted Corrigan, “since the 1960s, the main demographics for all movie audiences have been 18 to 28 year-olds.” Perhaps the new host paid off: Though he failed to attract more viewers than last year, ratings among adults ages 18 to 34 and women ages 18 to 49 were the highest in three years. “One might make some tradeoffs,” suggested Reibstein, referring to Rock’s obvious appeal to the Oscars’ movie-going age group but not the entire audience. “A bump [up] in the right demographics might be good for the industry.”

“That is important — for the future of the Oscars, for the advertisements, for the movies,” said Reibstein. “There is always a lift that comes out of the Oscars for movie-going attendance. You can see it, suddenly, the day after the Oscars. The advertisements change –’Winner of Best Director’…. More broadly, the awards re-engage people in thinking about movies. There is indeed concern that as the audience for the Oscars show grows weaker, the bounce in the entertainment industry will be less.”

The Oscars may no longer be the only game in town, but it’s still the only one that really counts.