A Harvard Professor Knows Why the Bloated Blockbuster Will Never Dieby
On a recent Monday morning, professor Anita Elberse ambled into her office at the Harvard Business School. An electric guitar signed by the members of Maroon 5 rests in the corner, a few Spider-Man action figures lay scattered on a bookshelf nearby, and a jersey for the Netherlands national soccer team hangs on the wall. Not long ago, as part of her research for academe, Elberse interviewed Alex Ferguson, the mercurial manager of Manchester United, who once, in a fit of locker room anger, allegedly kicked a shoe into David Beckham’s award-winning face.
Elberse, who is lanky and blonde and Dutch, takes a seat at her desk. “I still hope that Ferguson gets to see me play soccer one day,” says Elberse. “I only need him to say, ‘Hey! You’re not that bad!’ That’s the main reason I’m doing all of this.”
For the past several years, while other business school professors were dutifully trudging back and forth between drab office parks and gloomy boardrooms, Elberse was mining management wisdom from more festive milieus in the upper ranks of various sports, entertainment, and media companies. Along they way, she rubbed shoulders with Jay-Z, Maria Sharapova, Lady Gaga, LeBron James, and Tom Cruise, while writing dozens of papers analyzing the tactics of the mortals who manage them.
Elberse’s research has now culminated in the publication of her first book, Blockbusters: Hit-Making, Risk-Taking, and the Big Business of Entertainment, in which she makes a bold, if slightly wonky, case against fiscal timidity in the entertainment industry. Over time, entertainment and media companies (ranging from book publishers to movie studios and television networks) tend to generate the greatest profits, she persuasively argues, when they focus their budgets on making a smaller number of expensive products aimed at mass audiences, rather than a larger number of cheaper ones aimed at selective niches. “The future of blockbusters in the entertainment economy shines bright,” writes Elberse.
The book’s arrival is well-timed. In June, Steven Spielberg threw the Hollywood blockbuster complex into an unprecedented state of self-doubt. “There’s eventually going to be an implosion—or a big meltdown,” the famed director warned. “Three or four or maybe even a half-dozen megabudget movies are going to go crashing into the ground, and that’s going to change the paradigm.” Over the following months, as if on cue from the forefather of the genre, a phalanx of big-budget movies—including The Lone Ranger, After Earth, R.I.P.D., and White House Down—imploded at the box office. “Industry insiders,” the Guardian reported, “are referring to this season as ‘the summer of doom.’”
Enter the PhD-wielding Elberse: “You can’t put too much weight on a few observations,” she says. “You need to look across the whole population for a number of years. When you do that, you see that the blockbuster strategy is still the way to go.”
Now that summer is long past, Elberse’s research looks vindicated. On balance, the hits—including Iron Man 3, Fast and the Furious 6, Star Trek: Into Darkness, and Man of Steel—managed to earn much more money than the flops managed to lose. According to Box Office Mojo, this year’s domestic box office pulled in a record-breaking $4.76 billion. The so-called “summer of doom” turned out to be Hollywood’s best summer ever.
In mid-October, Variety published a lengthy excerpt of Elberse’s Blockbusters book. Several days later, the professor celebrated with a book party at the Manhattan nightclub Marquee (whose owners had been the subjects of an earlier case study). The next morning, the New York Post chronicled the event in Page Six: LeBron James reportedly showed up late.
Long before the parties with LeBron, Elberse grew up far offstage, playing competitive soccer in IJsselstein, a small town in the Netherlands. Her dad was an accountant; her mom was a homemaker. After graduating from the University of Amsterdam, she moved to Los Angeles in search of adventure and went on to earn a masters degree from the University of Southern California, researching the new forces roiling the media world. For her PhD at the London Business School, Elberse wrote a thesis on how the big Hollywood studios were releasing films in the rapidly growing international movie markets.
Elberse arrived at the Harvard Business School in 2003, and she has since earned tenure while contributing some 30 case studies to the school’s archives, examining a bevy of entertainment and media businesses, including Marvel Enterprises, the CW network, Comcast, Hulu, A&M Octone Records, and Grand Central Publishing. The research informs the course she teaches to second-year MBA students, “Strategic Marketing in Creative Industries,” as well as her new book. “Now that I’m giving away all the answers, I’m going to have to develop a new course,” says Elberse.
These days, powerful media moguls routinely drop by to lecture her classes. Over time, a growing number of her students have followed them to New York and L.A. “She has an incredible network in Hollywood,” says Peter Stone.
Stone, 33, took Elberse’s class in 2008. Together, they co-wrote a case study about Tom Cruise. After graduating with an MBA, Stone moved to Los Angeles. These days he works as the director of theatrical marketing at Legendary Pictures, a Hollywood production company that recently co-produced the 2013 blockbusters Man of Steel and Pacific Rim. “I’ve ended up doing exactly what Anita was discussing in her class, which is strategic marketing in film,” says Stone. “She’s really helped to legitimize entertainment as a career for business school students.”
Troy Carter, who manages Lady Gaga and others in entertainment as the founder and chief executive of Atom Factory, says that, to date, he has visited Elberse’s classroom four times. He and Lady Gaga also served as the subjects of an Elberse case study. “It’s not a lay-up,” says Carter. “She’s challenging you on past decisions—what I look at as repressed memories. You don’t want to go back to revisit some of those low moments. But she’s constantly pushing.”
“She’s not your typical academic,” he adds. “She hangs out with the biggest celebrities that you can find. They’re more intrigued by her brain than she is with their status.”
In addition to teaching the occasional class, Carter says he now finds himself regularly taking meetings with Elberse’s current and former students. He describes the relationship as mutually beneficial. “I’ve even invested in a couple of their startups,” says Carter. “I look at her class as a farm club for me.”