Coverage: Hunger Games opening huge – and disappointing

The third movie in the Hunger Games franchise pulled in $123 million in its opening weekend. It was the biggest premier of 2014, but less than the other movies in the series.

Ben Fritz had this story in The Wall Street Journal:

The latest installment of “The Hunger Games” film series was a hit by nearly any measure — except its own.

“The Hunger Games: Mockingjay Part 1” opened to $123 million in the U.S. and Canada, according to an estimate from studio Lions Gate Entertainment Corp. Although that is easily the biggest opening of 2014, it is 22% lower than the prior “Hunger Games” movie, “Catching Fire,” which opened to $158.1 million on the same weekend last year. The first “Hunger Games” opened to $152.5 million in March 2012.

Investors dinged Lions Gate’s stock after it became apparent from screenings late Thursday that “Mockingjay” likely wouldn’t perform as well as its predecessors. Shares in the studio dropped 5% on Friday, settling at $33.25 in 4 p.m. trading on the New York Stock Exchange.

The blockbuster performances of “The Hunger Games,” starring Jennifer Lawrence and based on a best-selling young-adult trilogy, have been a key driver of a roughly threefold increase in Lions Gate’s stock price since early 2012. Though the company also has a growing television unit that makes “Mad Men” and “Orange is the New Black,” motion pictures are its biggest business and “The Hunger Games” its most valuable asset. The last two movies grossed a total of $1.56 billion world-wide.

The Associated Press (via the Huffington Post) story by Jake Coyle said that the mixed opening confused investors:

The result made for some unusual ironies. The biggest opening of the year (and by a wide margin) was seen by some as a disappointment. After initial box office receipts of “Mockingjay” rolled in Friday suggested a weekend take below expectations, Lions Gate Entertainment’s stock dipped 5 percent.

But the decision to split the final book in Suzanne Collins’ dystopian trilogy into two films was clearly lucrative for Lionsgate. “Mockingjay” did even better overseas, where it made $152 million over the weekend, accounting altogether for a $275 million global opening.

“It’s the biggest opening of the year, so it really illustrates the strength of the franchise,” said David Spitz, head of distribution for Lionsgate, noting the North American opening was the 15th best ever.

Spitz declined to answer questions about Wall Street’s reaction to the opening, or what the effect may have been of splitting the third book in two.

Brooks Barnes wrote for The New York Times that the 27-person marking team at Lionsgate had leveraged social media to generate buzz, setting an example for larger studios:

Perhaps more impressively, given the constant discussion in Hollywood about reducing promotional costs, Lionsgate spent roughly $50 million to market “Mockingjay” in the United States and Canada. Hollywood’s six major studios, each of which operates a domestic marketing department at least three times the size of Lionsgate’s, routinely spend $100 million to release a major movie in North America.

“There is a lot of fat,” said Richard Greenfield, an analyst at BTIG Research.

The lesson is as obvious as it is humiliating: In the social-media age, the marketing of mass-appeal movies does not necessarily require a cast of thousands (or hundreds) or a Brink’s truck full of cash. Lionsgate keeps costs down by taking full advantage of low-cost media like YouTube, by making certain advertising decisions without relying on expensive market research studies and even by shooting its own pictures to save on photography.

Big studios like Universal Pictures and 20th Century Fox release more big-budget movies than Lionsgate does, which is one reason they maintain much larger domestic promotional departments. But little Lionsgate has lately been schooling some of its heftier rivals.

Walt Disney Studios, for instance, recently sent its global marketing and publicity teams to Google’s vaunted BrandLab for workshops intended to help companies “world-build,” a trendy catchphrase that means creating overlapping online experiences for various customer bases. Google held up Coca-Cola and Mercedes-Benz campaigns as best-in-class examples, along with a lone movie: “The Hunger Games.”

Forbes contributor Scott Mendelson pointed out that few other films would have to defend such a big opening weekend:

Yes, I’m sure Lionsgate would have liked another $150m+ weekend on its belt, but I can’t think of another franchise save the Avengers films which would be expected to have to defend such a mighty weekend haul. That’s a 2.27x weekend multiplier, which is a touch higher than the 2.25x weekend multiplier for Catching Fire ($158m/$70m) and the 2.26x weekend multiplier for Hunger Games ($152m/$67m). But nonetheless, the film performed closer enough that we can consider the long term math to be pretty similar to the last two runs. If it performs like The Hunger Games and Catching Fire, it will end its domestic run with $329m, just below Guardians of the Galaxy as 2014′s top domestic grosser. I would imagine Lionsgate will keep it in theaters longer than they otherwise would if it comes down to the wire, but that’s a discussion for next month.

Come what may, the film cost $125m to produce, so it will double its budget domestically by early December at worst. And let’s be honest for a second, the franchise has just one more entry to go. Even if this entry plays more like a Twilight sequel (which would give it around $260m domestic), there isn’t much at stake beyond pride.

The weekend was a strong one – and one that many studio executives would love to have – but might not be enough for Lions Gate investors. The Hunger Games franchise has been built up, but perhaps it has been pushed beyond expectations. It is the first part in an installment in a story that everyone knows, which could have kept some away from the opening. But no matter the disappointment, the film blew every other one out of the water for the weekend.