Recently Catherine Rampell of the New York Times published a chart that should make documentary and horror producers smile. Horror has long been known as a cash cow for Hollywood, but documentary is rarely mentioned when it comes to return on investment. Rampell found that in her sample of films released in the past decade, documentary box office returns far outweighed other genres when expressed as a percentage of production budget. Sound surprising? Misleading, perhaps? Hit the jump to take a closer look at the numbers.
Using numbers from OpusData and Box Office Mojo, Rampell looked at films released from 2003 to 2013 that grossed at least $2 million domestically -- knocking out (you guessed it) the majority of documentaries. The resulting data shows us that successful documentary films rake in some killer returns, averaging 12 times the production budget domestically and 27 times the budget internationally.
Should we conclude that if you want to turn $1 million into $27 million, you should invest it in a great documentary film? Only if you're pretty dang sure the film is going to be successful. 55 of the 78 documentary films in Rampell's data set didn't disclose their production budgets. So her doc numbers are skewed towards the brag-worthy -- or at least those committed to transparency. Rampell notes:
Of course, documentaries are generally much cheaper to make than other genres, averaging about $2.6 million in production budget versus $95 million for action films (unadjusted for inflation). So it makes sense that for the small subset of documentaries that do well (remember, these averages include only those films with domestic grosses above $2 million), the R.O.I. can be enormous.
Horror film numbers were a bit more concrete with 113 out of the 129 films disclosing their production budgets. The average successful horror film in the past decade earned six times its production budget domestically and double that internationally by Rampell's calculations.
It looks like far more successful dramas, comedies and thrillers were made in the past decade, with 357, 373 and 170 disclosing their budgets respectively. All three achieved between 300% and 500% of their production budgets in global box office returns, which is not too shabby for such a large number of films reporting budgets in each genre. As Rampell points out, she's only looking at box office numbers, which of course only represent one piece in a film's revenue puzzle.
The data going into this graph is patchy at best, but it could indicate that major studios are spending less money than they should on major documentaries. Not to say that Universal's next tent pole should be a $20 million doc -- but perhaps 10 relatively major documentaries would accumulate a better return than recent Hollywood narrative releases.
What do you think? Should documentarians target the thrill-seekers of the investment world for a risky but possibly quite lucrative ride?
[Dollar photo by Flickr user MakeShiftPhoto]