Why I Fired Billionaire Mark Cuban & What Hollywood Doesn’t Understand About Marketing 2.0

It was an extremely tough decision to write this. I mean, who wants to cheese off a billionaire? And frankly, I’m worried that many will read this and take it as me trying to create link-bait, or whatever.

I have to have full-disclosure; I have a history of baiting Mr. Cuban. So take that in stride when you read this blog post. However, that bait actually did bring about my ability to work out a testing deal with him (which you will read about below), so I suppose you could say it worked to my advantage.

I can honestly tell you that I’m haven’t written this for publicity, or to be mean spirited at all. Sure, the headline is probably the best link-bait headline I’ve ever constructed, except for the fact that it’s true, but I can implicitly say that there’s a lesson learned from my experience and I felt it needed to be shared.

That all being said, Jim, did you really fire Mark Cuban?

Well, yeah. The short story is this. Last fall I contacted Mark about a blog post he wrote where he asked for creative ideas for how to “sell more tickets” to movies online. He got back to me (and the network I used to own) and put me in touch with the movie studio he owns called Magnolia Pictures with the instructions to make a test work.

I sold a plan to them, and that was to setup a test of selling movie tickets to Magnolia Pictures movies on blogs, through affiliate marketing techniques. For example, a blogger would earn a few bucks if they could refer a reader to buy a ticket for a movie online.

The whole concept is pretty simple right? Magnolia Pictures makes smaller independent films, you know, the kind that live and die based on their buzz because they simply don’t have the huge Hollywood marketing budgets to get the word out. So it made perfect sense to let bloggers, who were already talking about these films, attempt to sell a few tickets and be compensated for it if they wished. (Note: we’re not talking about writing fake content for cash.)

For example, they had a movie called Jesus Camp that generated thousands of pages of blog fodder for them, and what did they get out of it besides some links to the movie home page? Nada, zip, zilch.

So the “test” was on. We all agreed to run the test to see if the technology would work. It did. Through the month of December 2006 we ran CPA banner creatives on a handful of movie-related blogs, including one of the biggest in the industry, across millions of impressions.

As I mentioned, the technology worked perfectly of course, the problem with “the test” was that the future success of the initiative was setup to fail without the rest of the plan being put in place at some point.

So What Was The Problem Then?

The problem was in the definition of “the test”. For us, it was very clear that the technology part of the test was easy to accomplish, and we did. That wasn’t what we pitched though. We pitched a complete solution to managing the affiliate program, which in essence was going to be a large community of bloggers and web citizens who weren’t going to be affiliates, but rather customer evangelists and uber content producers.

Too bad money got in the way, because they believed in the plan somewhat, yet didn’t want to pull the trigger.

Anyone in the affiliate marketing business knows the golden rule. You can’t just throw up a program and expect it to just work, right? Right. To be fair, I’m pretty sure that Mark realizes this, I mean, you don’t get to be that successful by not knowing one of the basic rules of business, which is effort=success. I mean, the guy is extremely smart.

Our long-term business plan was solid, and I believe it was exactly what needed to be done, and from our initial conversations with Mark and the gang at Magnolia Pictures, it was something we all agreed would work. However, we were asked to follow through with our plan to create this program (after the technology test), we were asked if we could do it for almost nothing monetarily.

Here Comes The Firing Part

I have to admit, I thought about it for a day. The lure of being on Mark Cuban’s blogroll and circle of influence was attractive, however, the obvious answer was there was no way we could commit unpaid resources to the project in “hopes” of it working, even with the possible shout-outs we might get, but weren’t even guaranteed.

So that was that, we had to fire Mark Cuban. Not because he doesn’t get it; it’s not that at all. He simply didn’t want to pay for it.

A Huge Missed Opportunity For Small Budget Hollywood?

I’m certainly no movie business guru. I don’t read the trades, or know much about the actual business of marketing movies, except for watching Entourage. So there is of course a chance that I’ve got this completely wrong, and I’m stupid. I’m sure you’ll correct me if so.

However, what I do know is online marketing, customer evangelism, user generated content, passion, attention, and blogging, and specifically how to combine all of those to be successful, regardless of the industry.

That being said, let’s look at the issues facing a small movie studio like Magnolia Pictures.

1. They don’t have the huge marketing budgets that large studios have.
2. They aren’t usually able to get the huge stars in their films who can carry a picture almost by themselves.
3. Their movies don’t usually get released nationwide, or even on multiple theatres.

So… how do they overcome those problems? Have they REALLY tried?

What are the big, or small, movie studios doing to market their movies besides throwing cash at a wall of media and hoping the reach enough eyeballs?

My solution was simple, and it involved bringing the bloggers and movie fans together to evangelize and promote the movies through social media and video sharing sites like Magnify.net, all processed through an “affiliate” channel that allowed “fans” to help sell tickets to movies online and get commissions from their indirect efforts.

It was building a community of fans and bloggers based around Magnolia’s small, yet powerfully charged films. In other words, simply tapping into their minds and the tools they are already using to spread the word.

If you don’t have a huge budget to promote the movie, what’s a better way than to enable your viewers to be part of the conversation and promotion?

Opportunity missed, perhaps.

Is Hollywood missing the marketing 2.0 boat? I think so. Can small movie studios like Magnolia Pictures continue to survive and thrive without marketing 2.0? I’m not sure they can.

You can view the original PowerPoint presentation presented to Magnolia here.