Does winning an Oscar matter? Why Netflix believes in spending big during awards season

It seemed like 2020 was going to be the year of streaming Academy Awards. Netflix alone has garnered more than 24 nominations, while having previously recorded only 30 in its entire six-year history.

Unfortunately for Netflix, the streaming service went home mostly empty-handed. Laura Durne won Best Supporting Actress for Marriage Story and American Factory took Best Documentary, but she was largely eliminated from the awards.

It was not lacking to try. The Wall Street Journal reports that Netflix has spent nearly $ 100 million on its 2020 O-Scar campaign, most of which is dedicated to Noah Bambach's marriage story and Martin Scors' The Irishman. By comparison, most movie studios cost $ 5- per movie. Costs 20 million. Scott Stuber, head of Netflix's original films, said that the $ 100 million estimate is high, but it is clear that it is important for Netflix to win a big Academy Award.

"They are spending a cash reservoir at the awards and it is forcing their rivals to reason, 'We will spend big budgets or we will not stay in the game,'" said Richard Likata, NBC Universal, showtime, Fox's former senior executive and HBOA. Told the Wall Street Journal.

That money goes to things like full-page advertisements in trade magazines, billboards, special Q&A screenings, private jets for filmmakers and actors, planes for movie promotion, extravagant receptions and a coffee table book sent to voters and journalists. In the case of the Irishman this year, Netflix has also created two hours of video extras, three hours of behind-the-scenes podcasts and over 20 YouTube videos to promote the movie.

These expensive campaigns are generally viewed as a way to get butts at movie theater seats - a gamble paid by historians, even if the films don't win. A 2005 study from the Journal Economy of Cultural Economics found that Best Picture won $ 25 million (or $ 33.8 million in 2020 dollars) due to winning box office fees.

Nevertheless, the study concluded that "nominations for sc scores generate significant revenue, while winning the award contributes little to these additional rents." In other words, it is more important to take part in the race than to win it.

IBIS World's Research Firm's 2011 report also found a similar effect: "In the last four years, average Best Picture sc score winners saw an increase of 22.2% (or .320.3 million) in office office fee revenue when they were nominated and 15.3%. (Or .014.0 million) following their win at the award show. "

Of course, it's difficult to quantify how awards affect streaming services. For example, Netflix limited the Irishman's theatrical run to just 26 days this year. Last year, when Netflix garnered 15 nominations, it added 8.8 million subscribers in the fourth quarter, i.e. the award season. That was beyond his .6.6 million projection, but it's unclear how much his Sc Roma contenders like Roma had to do with it.

Not relying on a theatrical run meant the awards campaign would benefit from streaming services indefinitely - because Roma is permanently on Netflix, so the company could justify the cost more than its traditional studio counterparts. To put this into perspective, Netflix has spent $ 15 million to build Roma and $ 25 million for its promotion.

Whatever the impact of the money, it was probably d wet this year - the 2020 Academy Awards were the lowest ever seen. But the benefits of streaming services can go beyond just sign-ups.

Netflix CEO Reed Hastings recently told investors that winning the award has a clear "business advantage". "We'll win deals we didn't win for incredibly entertaining content."

That means attracting high-level talent, part of a virtuous cycle in which grand campaigns contribute. However, you have to think that Netflix (and the talent it hopes to attract) will want to prove that it can win big at some point. Until that happens, expect them to continue to see their way into the conversation.