Film studios and synergy.

How can film studios use Franchises to create Synergy?

Film studios can use a popular franchise to boost the total revenue of the franchise. This is accomplished by realising other products of the franchise, with the launch of a new movie. For example, when the new Star Wars film comes out, although it may not create as much revenue as they expected, it can still fall back on the sales of other products of the franchise; Video Games, Merchandise and Toys. These will be popular products just because of the release of the film, meaning that these items will create more revenue for the Star Wars franchise.

Synergy is when a business releases and sells products, from the same franchise, at the same time to get an increase in revenue. With synergy, Film companies don’t have to rely on the success of the film at the box office as much, so much money is raised from other sources of the franchise that the film acts as a stimulant for the franchise.

Horizontal Integration is a business strategy, which is when a business sells products from the franchise in numerous markets. For example, showing a film made by your company in a cinema owned by different companies, this increases the revenue that a company makes (although they do not gain 100% of the profits).

And example of a film studio using franchises to create synergy is Sony’s franchise Resident Evil. Originally starting off as a video game, Resident Evil became a very popular Survival Horror game. To this day, Resident Evil is ranked 20^th in the all time best selling game franchises, selling over 60 million copies, this is with the help of synergy. The latest game that was released was Resident Evil 6, which was released on the 1^st of October 2012. The latest film to be released was Resident Evil: Retribution on 14^th September 2012. The video game was released not long after the film; this is synergy by Sony Computer Entertainment, creators of the game. The video game is one of 28 Video games in the franchise and sold over 5 million copies, and raised the revenue of the franchise. As well as the video game, other products that were released on that day were Resident Evil merchandise; like Film character figurines, clothing and posters. All of which raised revenue for the franchise