What types of low-budget films make the most money?

low-budget films make the most moneyThis is the fourth article in my series looking at the financial side of the film business.  In previous articles, I’ve looked at $100m+ Hollywood blockbusters, $30m-$100m movies and profitability across all movies released between 1990 and 2015.

This week I have teamed up with Bruce Nash from The Numbers for a research project originally commissioned by the American Film Market.  They asked us to look into what types of low-budget films “break out” (i.e. make far more profit than is typical for films of their scale) and if there were any lessons for independent low-budget film producers.

What types of low-budget films make the most money?

To discover the commonalities amongst low-budget breakout hits, we began with a list of over 3,000 films from The Numbers’ financial database, investigating full financial details, including North American (i.e. “domestic”) and international box office, video sales and rentals, TV and ancillary revenue. We narrowed our focus to study feature films released between 2000 and 2015, budgeted between $500k and $3 million, which generated at least $10 million in Producer’s Net Profit, using a standard distribution model where the distributor charges a 30% fee.

This produced a list of 63 films in total: roughly four films a year over the 15 years under consideration. Almost all of the movies will be familiar to followers of independent film, from small films that became Oscar hopefuls, like Beasts of the Southern Wild and Winter’s Bone to horror movies like Insidious and The Purge that got picked up by the major studios and became box office sensations. With the list in hand, we looked for common themes and found (with a small number of exceptions) that the breakout hits broke down naturally into four types.

Model one: Extreme, clear-concept horror films

It will come as no surprise to most producers that horror films feature prominently on the list of top low-budget breakout successes.

horror-02

  • Most profitable films: Insidious, Monsters, The Devil Inside, Paranormal Activity 2, Dead Snow
  • MPAA Rating: 82% are rated ‘R’, 12% PG-13 and 6% not rated.
  • Running time: Relatively short, with an average of 94 minutes and no film ran over two hours.
  • Critical reviews: Average to poor.  Highest rated film in this category is “Buried”, which has a Metascore of just 65 out of 100.  The average Metascore across the dataset was just 49 out of 100.
  • Audience reviews: More supportive than the critics but still not above most films, at an average of 6.2 out of 10 on IMDb.
  • Release patterns:  Two very distinct release patterns:  half played in fewer than 100 theatres while the other half played in over 1,500 theatres.
  • Income streams: 28% from theatrical, 60% from home video and 11% from TV and other ancillary income.
  • Income location: 46% of income was from the US & Canada and 54% international.

Model two: Documentaries with built-in audiences and/or powerful stories

The second group of films that stood out were documentaries.

Docs 01

  • Most profitable films: Exit Through the Gift Shop, An Inconvenient Truth, Marley, Tyson, Bowling for Columbine
  • MPAA Rating: A healthy spread across all ratings, with the most common being PG-13
  • Running time: Average of 102, although a wide range from 80 minutes up to 144 minutes
  • Critical reviews: Very high, with a Metascore average of 79 out of 100.
  • Audience reviews: Very high, an average IMDb rating of 7.8 out of 10.
  • Release pattern: Small number of theatres, with most playing in under 250 theatres and the widest release being An Inconvenient Truth in 587 theatres.
  • Income streams: 70% of income comes from home video, 17% theatrical and 12% via other sources.
  • Income location: 58% international and 42% domestic.

Critical reviews seem vital for this type of film to break out and it’s interesting to note that the documentaries with the lowest scoring critical ratings (The September Issue at 69 and Religulous at 56) each had strong inbuilt audiences (‘Vogue / fashion’ and ‘Bill Maher / religious scepticism’).

In fact, only a handful of the documentaries on the list don’t have an obvious audience: Man on Wire, Anvil: The Story of Anvil, and Searching for Sugar Man are the only ones that needed to find a crowd. The others were either about someone already very famous (Marley, Tyson, Senna, Amy… note the one-name titles!) or played very directly to a receptive audience (Inside Job, Blackfish, An Inconvenient Truth etc).

Model three: Validating, feel-good religious films

Speaking of receptive audiences, the third group of films we found were faith-based films.

Religous 01

  • Most profitable films: Fireproof, God’s Not Dead, To Save a Life, War Room, Courageous
  • MPAA Rating: Two-thirds were rated PG and the remaining third were PG-13
  • Running time: Fairly long, all were over 110 minutes and the average was two hours.
  • Critical reviews: Incredibly poor, with an average Metascore of just 26 out of 100.
  • Audience reviews: Similar to the horror pool, with an average IMDb rating of 6.3 out of 10.
  • Type of release: An average of 1,273 theatres with the widest being War Room at 1,945 theatres.
  • Income streams: 55% from home video, 29% from theatrical and 16% from television and other ancillary streams.
  • Income location: 90% of income came from North American sources with just 10% coming from outside the US and Canada

Two things stand out with these films. First, they make virtually all of their money in the United States. Second, they get very bad reviews from mainstream movie reviewers. The strength of these movies isn’t necessarily their quality so much as the message; they deliver to an audience that is interested in what they have to say.

Model four: Very high quality dramas

At the other end of the spectrum, at least in the eyes of professional film reviewers, come very high quality dramas. Almost half of these films were American productions, with the rest coming from a wide variety of countries including Germany, Argentina, Mexico, the UK, France and Poland.

art films 01

  • Most profitable US dramas: Half Nelson, Waitress, Blue Valentine, Fruitvale Station
  • Most profitable foreign dramas: The Lives of Others, The Motorcycle Diaries, Amores Perros, Sin Nombre
  • MPAA Rating: The vast majority are R-rated, with just a third being rated PG-13
  • Runtime: A wide range, from 81 minutes up to 154 minutes long.
  • Critical reviews: Extremely high, with an average Metascore of 81 out of 100.
  • Audience reviews: Similarly high, with an average IMDb rating of 7.5 out of 10.
  • Type of release: Small release, with all but four playing to fewer than 300 theatres.
  • Income streams: 63% from home video, 25% from theatrical and 12% from other sources.
  • Income location: 66% of income for US dramas came from the US and Canada, whereas the reverse was true with non-US dramas, with 64% of income coming from international sources.

The lowest rated film in this category received a Metascore of 68 out of 100, which was higher than all of the films within the Horror breakout success category.

A common thread among these films is awards attention. While they might not be big enough to win a lot of main-category Oscars, these are the films that have picked up a bunch of Independent Spirit Awards, Best Foreign Language Film at the Academy Awards, and got some screenwriting and/or acting Oscar nominations.

Do the films have to be any good?

An interesting finding from this research is that the quality of the film is only relevant for certain types of films.

  • Religious films received extremely low ratings from critics but had mixed ratings from audiences.
  • Horror films showed a range: some were disliked by both audiences and critics (such as The Devil Inside), while others had middling support from both camps (such as Monsters) and then there were films which audiences enjoyed but critics were lukewarm towards (such as Dead Man’s Shoes).
  • Documentaries and Dramas were all popular with audiences and the vast majority also received extremely high ratings from critics.

If we plot this on a graph, we can see just how distinct these three sub-categories are.

low-budget films make the most money

What’s missing?

Many of the films in the list come as no surprise, but what’s interesting is what’s missing from the list. We found…

  • Virtually no comedies (Waiting… is the only out-and-out comedy on the list, and it was made at the peak of the DVD sales boom)
  • No action movies
  • No thrillers
  • No musicals
  • Virtually nothing directed at kids — Dr. Dolittle 3 was the only family movie that made our list — although we believe some animated franchises, such as Barbie and Tinker Bell are very profitable but their budgets aren’t quite in our range.

Aside from the missing genres, the other notable absence is any major star involvement. Of course, this is largely a function of the budget—it’s hard to get Tom Cruise for a $3 million film—but it’s remarkable that none of these films attracted anybody who would even be called a B-list star at the time the film was made.

Lessons for filmmakers and producers from this research

So we think there are a few lessons for independent film-makers who are hoping to make breakout hits:

  1. Some “niche” audiences are large enough to make for a very profitable market, if you can reach them. The “faith-based” film audience stands out, but there are also receptive audiences for certain types of documentaries. Having a very clear idea of your audience is the first step to making a financially successful film.
  2. If you’re aiming for a more general audience, quality matters. A lot. Honing your screenplay to what you think is perfection and then having it ripped apart at a workshop may be hard work, but it’s almost certainly what it takes to get a dramatic film to ultimately work with audiences, and to make back its investment.
  3. Look for good actors, not big stars, and do the same with all of the technical crew on a film. Fun fact: Affonso Goncalves, who edited list member Beasts of the Southern Wild also edited fellow list member Winter’s Bone and 2016 Oscar nominee Carol. Finding a good editor, cinematographer, production designer and other key members of the crew is more important for a low-budget film than blowing a big chunk of your budget on a famous (or, just as likely, previously-famous) actor or actress.

The full list of films

This analysis looked at feature films released between 2000 and 2015 budgeted between $500k and $3 million and which we estimate generated at least $10 million in Producer’s Net Profit.  The films which fit our criteria are listed below.

RankFilm TitleYearMetascoreIMDb ratingEstimated Budget
1Bowling for Columbine2002728.0$3,000,000
2The Lives of Others2006898.5$2,000,000
3War Room2015266.2$3,000,000
4God's Not Dead2014164.9$1,150,000
5An Inconvenient Truth2006757.5$1,000,000
6Garden State2004677.6$2,500,000
7Insidious2010526.8$1,500,000
8Fireproof2008286.5$500,000
9Paranormal Activity 22010535.7$3,000,000
10Hustle & Flow2005687.4$2,800,000
11Waiting...2005306.8$1,125,000
12Courageous2011427.0$2,000,000
13Waitress2007757.1$1,500,000
14The Motorcycle Diaries2004757.8$3,000,000
15Exit Through the Gift Shop2010858.0$500,000
16Man on Wire2008897.9$1,900,000
17Dr. Dolittle 320063.9$3,000,000
18Sinister2012536.8$3,000,000
19Winter's Bone2010907.2$2,000,000
20Blue Valentine2010817.4$1,000,000
21This Is England2006867.7$2,380,000
22[Rec]20077.5$2,100,000
23Amores Perros2000838.1$2,000,000
24The Last Exorcism2010635.6$1,800,000
25Shine a Light2008767.2$1,000,000
26Monsters2010636.4$1,000,000
27The Squid and the Whale2005827.4$1,500,000
28The Purge2013415.6$3,000,000
29Senna2010798.6$1,000,000
30The September Issue2009697.0$1,000,000
31The Devil Inside2012184.2$1,000,000
32Riding Giants2004807.9$2,600,000
33Half Nelson2006857.2$700,000
34Buried2010657.0$1,987,650
35Pina2011837.7$1,000,000
36Head-On2004788.0$2,500,000
37The Hidden Face20117.4$2,600,000
38Sin Nombre2009777.6$2,000,000
39Fruitvale Station2013857.5$900,000
40Inside Job2010888.3$2,000,000
41Amy2015857.8$2,750,000
42To Save a Life2009197.1$500,000
43Marley2012828.0$500,000
44Religulous2008567.7$2,500,000
45Real Women Have Curves2002717.0$3,000,000
46Wolf Creek2005546.3$1,100,000
47Tyson2008837.6$500,000
48Teeth2007575.4$2,000,000
49Food, Inc.2008807.9$1,000,000
50Dead Man's Shoes2004527.7$1,125,000
51Dog Soldiers20026.9$3,000,000
52I've Loved You So Long2008797.6$2,500,000
53The Human Centipede (First Sequence)2009334.5$1,850,000
54Beasts of the Southern Wild2012867.3$1,800,000
55Anvil: The Story of Anvil2008828.0$500,000
56Enron: The Smartest Guys in the Room20057.7$750,000
57Blackfish2013838.1$750,000
58Half Light20066.0$2,400,000
59A Haunted House2013205.1$2,500,000
60Ida2013917.4$2,750,000
61Is Anybody There?2008546.8$2,500,000
62Searching for Sugar Man2012798.2$500,000
63Dead Snow2009616.4$800,000

Notes on which low-budget films make the most money

  • The financial figures come from a variety of sources, including people directly connected to the films, verified third-party data and computation models based on partial data and industry norms.  It is possible that one or two of the individual figures are different to our predictions, though en mass we are confident of the larger picture.
  • The number of theatres relates to the widest point of the film’s North American release.