3. Bigger Doesnt Necessarily Mean Better Or More Profitable
A film's budget has no bearing on its quality or its monetary potential. No matter how much you spend on it, cinema ticket prices will remain the same and ticket sales will be more or less the same. So if you really must throw caution to the wind and invest hundreds of millions of dollars into a film, you'd better be sure that you're spending your money on something that's either high quality or very marketable. An example of this logic not being followed through on is Evan Almighty. Evan Almighty's (a comedy starring Steve Carell as a man who builds an ark) production budget was a whopping $175 million, giving it the dubious distinction of being the most expensive comedy film ever made. But all the money and massive effects sequences in the world didn't stop it from being poorly received by critics and grossing $173,418,781 worldwide, with some analysts calculating its losses at just over $88 million. This ties into my argument about profit margins on the next page but the point I'm trying to make here is that its high budget and expensive effects couldn't stop Evan Almighty from being an almighty flop. Elsewhere, The 40 Year Old Virgin (a decidedly more adult comedy which also starred Steve Carell in the title role) grossed $4 million more than Evan Almighty on around 7% of its production budget. But the biggest example of how budget and financial potential aren't linked to each other is Paranormal Activity. Its budget was a minute $16,608 (when adjusted for inflation) and it ended up being a runaway hit with a worldwide gross of $206,912,000. Which means that (ignoring marketing and distribution costs) its gross profit margin is over 12,000% on a budget that your average Hollywood executive would probably spend on toilet paper. Admittedly it's hard to gauge how a film will be received without actually making it but the broad point of employing armies of script editors, focus groups, and marketing experts is to get as close to certainty as possible that the product you're making is worth the money being spent on it.