Horror movies today have become the most solid, and sure-fire way for studios to make a quick buck. We are currently surrounded by monstrous-sized budgets for films that studios roll the dice with monthly. Budgets ranging from $150-$350 million, not even including marketing which usually is at least the cost of the movie itself, have studios needing half a billion in the Worldwide box office just to break even. On the other side of the spectrum, however, we have Blumhouse and A24 who have risen through the studio ranks by producing hits that cost less than $5 million a pop, and almost exclusively come from the Horror genre. These two studios have been able to make a lot off a very little. A24 and Blumhouse have also bucked another Hollywood trend and have used the profited money not to stuff their pockets with, but instead, reinvest the profit into more films to add to their catalog to boost their reputation and status. The Horror genre has become the quick new way for studios to gain clout and reprieve in Hollywood and has cemented its place as an irreplaceable Box Office force.
It started with The Blair Witch Project back in 1999. With a production budget of $60,000, the campy found footage film became a cultural phenomenon and ended up grossing $248 million Worldwide. There were some knocks offs after, and close encounters with movies like Saw in 2004 grossing $100 Million off a $2 Million-dollar budget, but the story of a film breaking through on such a small budget was not really revisited until a movie named Paranormal Activity was released in 2009. Paranormal Activity boasted the production budget of $15,000, and ultimately went on to gross $193 million worldwide, breaking The Blair Witch’s record for biggest box office multiplier compared to its budget (12,866.66% to the Blair Witch’s 4,133.33%). The producers of Paranormal Activity were Director Oren Peli and Jason Blum. Oren Peli went on to produce and direct some more moderately successful Horror films, while Jason Blum has created a powerhouse up and coming studio modeled after the success of The Blair Witch Project and his own Paranormal Activity film.
Blumhouse Studios has steadily built their catalog of films by making massive gains off smalls budgets and has used such momentum to gain steam like a snowball rolling downhill. Blumhouse has had Box Office hit after hit starting with the Paranormal Activity franchise, leading into the Insidious Universe, The Purge anthology, Sinister 1 and 2, Ouija and Ouija Origins, and other hit films like Oculus. Blumhouse also saw little risk in their film ventures; when they did produce a box office bomb, the risk was mitigated due to the extremely low production cost, and relatively cheap marketing focused on viral trends. After years of low budget, high profiting films that received mostly mixed critical and audience reception outside save a few, something new started to happen: Blumhouse started producing not only Box Office hits, but critically acclaimed movies too which the Titans of the industry. First the Oscar-nominated Whiplash, then Joel Edgerton’s The Gift, followed by M. Night’s Split, and most recently Jordan Peele’s Get Out. Blumhouse is now not only making great profits but great films, and has propelled themselves to the upper echelon of the studio ranks in Hollywood solely on the back of Horror films.
What defines a hit movie? Critical success once seemed to be the hallmark answer to this question, but now a day this answer seems to have become a second-tier barometer in judging success. The premier measuring-stick today is Box Office success. Jurassic World: Fallen Kingdom is undoubtedly considered a Box Office success, but not critically or to the audience’s delight. Yet the film has made $1.2 Billion Worldwide off a $170 Million-dollar budget. This number doesn’t include Universal’s robust marketing campaign which probably inflates the budget number to at least $400 million, conservatively. Having said this, the film’s multiplier is still roughly x3, a solid cash maker. Conversely, Blumhouse’s Truth or Dare, which was not a critical success, made $92 Worldwide off a $3.5 Million-dollar budget. Inflate this number to $10 Million for marketing, you are looking at x9 multiplier. Jurassic World: Fallen Kingdom made more money, by a lot, but which was more successful?
Blumhouse will use the profit from Truth or Dare and go out and produce and market 7 to 8 more films on this same level of production or a few at a more flexible budget. A24 implements this same cycling-money-funnel method in their productions when movies like Hereditary makes $79 Million Worldwide off a $10 Million-dollar budget for a x4 multiplier (accounting for a x2 overall budget including marketing), and The VVitch makes $40 Million dollars off a $4 Million-dollar budget for a x5 multiplier. Studios like Disney, of course, will use Avengers: Infinity War’s x4 multiplier off a half billion budget that grossed $2 Billion to cover other ventures. Avenger’s profit could easily cover a movie like A Wrinkle in Time with a $130 Million budget (around $230 with marketing). And Disney can predict films like Star Wars: A Solo Story to make $600 Million dollars and spread unearned money on future projects. But when A Wrinkle in Time takes a loss-making $132 Million dollars Worldwide, and Solo under performing and coming in drastically under the predictions at $390 Million dollars Worldwide, the sting seems deeper than whiffing on a $3 Million-dollar production, and the Avenger’s money starts to run out quick.
For this reason, the larger studios have undoubtedly picked up on this trend Blumhouse and A24 have capitalized on and even themselves have started to realize the benefits of small budget horrors producing big results to cover previous failed Box Office films, or to pay for forthcoming productions. New Line Cinema (a subsidiary of Warner Bros.) produced Annabelle on a $6.5 Million-dollar budget and earned $257 Million dollars globally for a x20 multiplier (again accounting for a x2 overall budget including marketing). Warner Bros. also produced the latest IT movie for $35 Million dollars and earned $700 Million globally for a x10 multiplier. The second installment is said to have a rather tamed budget as well. Paramount’s A Quiet Place had a budget of $17 Million and made $332 Million Worldwide for a x10 multiplier. Horror has undoubtedly become the most secure way to make generous profits off minimal budgets and has been hard-pressed to reproduce across genres. Warner Bros. Comedy CHiPs had a budget of $25 Million and made $26 Million Worldwide so it is safe to say that movie lost money. The same with Will Ferrel And Amy Poehler’s film The House which made $34 Million of a $40 Million-dollar budget. Even the most generous example of a Comedy’s success akin to Horror’s would-be Universal’s Girls Trip which made $140 Million of a $19 Million-dollar budget for a x3.5 multiplier. It is also unreproducible across the action genre as well with Blumhouse’s first action thriller Upgrade, which received great critical and audience reception, failing to even make back it’s $10 Million-dollar budget.
It is Horror that seems to have stood out among the crowd as the recession-proof way to make a profit, coupled with the transcendent budget scale the genre has adopted. Horror is a lot more black and white than most genres, and this lends to its stability. Comedy is objective in what one finds funny, as a person’s sense of humor is a part of their unique identity. Action movies are similar in what a person is looking to get out of their movie-going experience, and also usually carries a higher base price tag in production for the effects. Horror rises above the rest in that fear is extremely universal in the similarity oh what scares people. Horror is effective on a low budget scale, and its draw is wider than then an average comedy or action film. Even the people who don’t like Horror movies will go see Horror movies (often with friends) to get that dreadful and terrifying experience. Fear is one of those things that everyone on the planet can relate with. With core movie studios now seeing the universality of Horror as being a cash cow to fund future endeavors or covering past losses, the genre will only continue to thrive. This should comfort every Horror fan out there as now they will never worry about their favorite genre being an outcast since the future foundation of all films will be built on bodies of past Horror movie profits.