Hollywood Disruption A24s The Backrooms Hits Massive 200 Million Milestone

The studio took a creepy concept born online and turned it into a major theatrical success. Their ability to do that quickly also shows us where the current economic landscape of film is headed.

Why this milestone matters

Box-office reports indicate that the global box office for "Backrooms" has reached approximately $212.7 million, making this A24's first-ever film to surpass $200 million, and A24's most successful film to date. This record-breaking revenue was achieved in less than 10 days and will potentially change the way Analysts treat "independent" studios.

The speed with which "Backrooms" reached $200 million is important from a business perspective. A quick-hit provides greater leverage with exhibitors, enhances momentum for future marketing efforts, and increases a studio's confidence in funding other potentially risky films. In the case of A24, it shows that a film can achieve blockbuster-type revenues regardless of its production cost as long as the concept, audience interest, and timing of release are aligned.

The backrooms effect

The fact that Backrooms is not just another studio sequel or superhero tentpole but also developed out of an existing online horror phenomenon creates a unique opportunity for it to translate the aforementioned energy of online content into a successful theatrical film. This process represents a very different pipeline than the traditional Hollywood method of building awareness from scratch.

This new approach to movie-making is part of the backstory behind its box-office success. When a film has developed a social media following before releasing, an audience will arrive ready to experience the film they have been following — with all of the associated curiosity and understanding. Therefore, the film doesn't need to create an entire universe before ticket buyers will purchase tickets; it simply must provide them with a feeling of satisfaction.

What A24 is proving

A24 has established itself as an independent film studio that specializes in producing high-quality films with a unique blend of ingenuity, style and emotion. A recent film from the studio, Backrooms, demonstrates how a studio can be successful at making commercially large-scale movies without compromising their identity as an independent film studio. This is difficult for most independent studios; many will attempt to create an eclectic, edgy and hip image while staying profitable, but only a select number have succeeded in maintaining their brand without losing its identity.

The business strategy that enabled their success is noteworthy; A24 is known for taking risks, producing lower-cost films and supporting filmmakers, often developing distribution plans that will allow exceptional films to compete with larger studio productions in the marketplace. Backrooms fits perfectly within this business model because the film was produced for significantly under the price of typical studio productions, but has sufficient size and cultural competition that it appears to be a major motion picture release.

Why horror still wins

Horror remains a popular genre for the theatrical market due to its ability to convert curiosity to opening weekend ticket sales, better than most prestige categories. Additionally, it tends to have a more universal language when compared to comedy, references and franchise based content, allowing it to travel well internationally. According to reports, backrooms have performed very well internationally with strong revenue from dozens of different territories.

This global appetite for horror is part of a larger disruption to the traditional Hollywood studio model, where studios that understand how to monetize emotion versus just Intellectual Property have more options for experimentation. Since horror films have the ability to be low-cost but also build strong global audience engagement through visual advertising, they provide studios with many opportunities to be successful worldwide when the core project concept has a strong hook.

The strategic lesson for the industry

Backrooms has demonstrated to the entertainment industry that consumer behavior is evolving, and often in positive ways. There is still a demand for theatrical experiences but with consumers valuing that they provide new, unique, and social opportunities for sharing. The fact that a film can build from its online platform to eventually achieve monumental success in theatres makes for a very compelling product at this point in time.

This creates a need for larger studio executives to redefine what they consider a "bankable" asset. Traditional thinking has limited the concept of a "hit" to those franchises that produce insane amounts of revenue, yet Backrooms has shown that through the application of a unique concept, a solid execution plan, and great timing within the culture will create a product that is much more cost efficient.

The most significant takeaway is that A24 is no longer just the trendy independent studio, with respect to winning awards and notoriety. With Backrooms, A24 has proven it can create an event-style motion picture that has both qualities equal to that of a cultural product, as well as, a profit-centered entity. This is a substantial statement that goes far beyond just an actual box office number.