The Viral Story of Paranormal Activity

The year 2007 saw a number of releases ranging from sci-fi Transformers to mind boggling Bourne Ultimatum. While the year was ‘going big’ with such releases, there was another movie that was coming from nowhere. The movie was Paranormal Activity which was finally released nationwide in U.S. in 2009. The supernatural horror movie has been directed by Oren Peli, and was one of the most successful movies of the year 2009. The film is about a young couple, Katie and Micah, who are disturbed by the supernatural presence in their new home they moved in.

According to Peli, “if you get a video camera, with a very small budget, you could make something happen.” Paranormal Activity was made with a budget of $15,000 and filmed in ten days. Paranormal Activity was more like an entrepreneurial venture where the resources were optimized in innovative ways. According to Peli, the equipments, tapes batteries and editing software were for more than half of the budget. Peli demonstrated how to do more with less.

The viral of Paranormal Activity started at the time of ‘Screamfest Film Festival 2007’ from producer Jason Blum followed by assistant at Creative Artists Agency, Ashley Brooks a production executive at Dreamworks, Production Chief Adam Goodman, Studio Chief Stacey Snider, and finally Steven Speilberg. After the screenwriters at a private screening found the movie too scary, the studio executives scrapped the plan of remaking the movie with a big budget and known star cast and rather planned to change the ending of the movie to be more surprising. Later, Paramount bought the rights domestic rights of the movie for $300,000.

Paramount used the unusual way of marketing. It first screened the movie in 13 small and medium sized cities or college towns like Austin, Texas, and Seattle. And then, the internet users were invited to “demand” the movie on “eventful.com” to request Paramount to book the movie in their towns. This was the first time when a major studio used “viral marketing” for a film. And it worked. The “word-of-mouth” was building and the demand was increasing. Paramount stated that once the demand reached the mark of one million, they will release the movie nationwide.

The marketing strategy of Paramount can be related to the marketing model AIDA, or “Attention, Interest, Desire, Action”. Let us see how Paramount followed this communication model.

Attention-Paramount created a marketing buzz by first screening the film at “Telluride Film Festival” followed by a free outdoor screening at “Labor Day Festival”. Later the film was also screened at “Toronto International Film Festival”. The film had positive reviews on the Internet with tweets and critics pouring in their response. Thus Paramount was successful in grabbing the attention of the audience.

Interest-This step was keeping the interest of the customers.  Director Olen Peli said, “The less people know about ‘Paranormal Activity’ the more they enjoy it”. For the first time, “eventful.com/demand” was providing service for a movie. The interest of the moviegoers caught on and worked. Twelve venues out of 13 were sold out. More demand was pouring in from different locations. Paramount made a press release stating that they were releasing the movie in twenty new markets including New York and Chicago. Steven Speilberg also proved to be an added advantage in arousing the interest of the people.

Desire-The next step for Paramount was to keep the interest of the people going in a way that they begin to grow in their desire for ‘Paranormal Activity’.  “If you get enough interest and it catches on and really works, you could use Demand for two or three weeks in October, and then put it normally, with reviews, by Oct, 30”,said Megan Colligan, Paramount’s marketing co-president. Paramount made a press release stating that they would release the film nationwide as soon as the counter hits one million. Paramount was right in estimating the desire of the people though the counter hit the mark much before, on Oct, 10. The movie got a wide domestic release on Oct, 16 2009.

Action-Now it was the time for the people to take action and for Paramount to map the action and proceed ahead. The movie grossed USD$9.1million in its first week in U.S., breaking the record of highest grossing weekend ever for a movie playing at less than 200 theaters. Following this success, paramount decided to release the film in locales worldwide by November.

Looking at the return on investment, Paranormal Activity is the most profitable movie ever. Based on the collections till Oct, 28 2009 TheWrap.com declared Paranormal Activity to be the most profitable film ever made as the return was found out to be 433,900%. According to boxofficemojo the lifetime gross of the movie worldwide is $193,355,800 and budget is $15,000. Calculating the return on investment by the standard formula of gross minus budget divided by budget times hundred the ROI of Paranormal Activity would cross the million percent mark.

Paranormal Activity created a new brand of horror and under this new brand two more sequels were released.  It was a new product that was original and scary. Instead of traditional marketing campaigns of huge ads, billboards, full page ads, behind the scene clips, tons of T.V. trailers and movie stars going on talk shows, Paramount used the most unusual way of marketing for a film making it viral. Rob Moore, the vice chairman of Paramount Pictures said in a company released statement, “From the very beginning, we put this film in the hands of the fans and trusted them to tell us where and when it should be seen. We couldn’t be more thrilled by their overwhelming support.”