An exercise in saving the R1 anime industry

[minakichan]

Building off that other thread, I thought it would be interesting to look into concrete actions that the anime industry in North America can take. (I'm a business major, so looking at this kind of thing is pretty interesting to me.) So here we go.

Congratulations! It's the year 2010, and some totally desperate R1 company of your choice (preferably a specific one) has appointed you CEO in order to revitalize their struggling business! What's your plan? Be as specific as possible as to what steps you want to take (but no need to include numbers)

Rules:
1) It's a bad economy, so it'll be hard for you to raise HUGE amounts of money to fund any new venture-- at least without diverting from some preexisting line.
2) The company should probably continue to sell at least some video in a physical format.
3) Just because this company was stupid enough to hire some random person like you doesn't quitting or shutting down the business are possible options.

Go wild.

[rocklobster]

I would put streaming on my site to advertise the stuff that's available. I'd probably even sell discounts on stuff that isn't selling well.

[TheSubtleDoctor]

Off the top of my head, I'd whittle down the number of our licenses to maybe half a dozen TV shows and one full length feature film per year and put the remaining licensing budget into marketing the crap out of those handful of shows or possibly lobbying for a big-seller to go onto Adult Swim (and maybe making some quality pieces of merch). Making inroads with the marketing, I feel, is pretty important. I think that would bring a little more balance to the company. We'd put our feet on the ground in light of the realization that we are operating in a niche market.

[ShiroiHikari]

1. Advertising, advertising, advertising. Don't rely so heavily on word-of-mouth-- get the word out there everywhere you can, not just in the same old circles. Reach new fans.

2. Hook 'em while they're young. In other words, market more kid-friendly stuff directly to kids and then make lots of related merchandise for them to beg their parents to buy. There's a lot of money there and chances are they'll either a) remain loyal fans into adulthood, b) come back to it again when they're older, for nostalgic reasons.

3. Build relationships with Japanese companies. Maybe if relations were better, they wouldn't force such crappy licenses on companies.

[blkmage]

Saving a floundering company is really hard and I can't think of any easy way to do it. If we were talking about the R1 industry in general, it might be a lot easier, like consider what a new R1 company would do to avoid mistakes or consider an existing company that might look into getting in on this (like NIS America, for example) or what a Japanese publisher might want to do if they want to get into localization (like Aniplex or lol Bandai Visual).

That said, I think that relying on a single source of income, whether it's DVDs or streaming is bad news bears. However, both are important. The pricing is the tricky issue. In order to compete with fansubs, they essentially need to be free within hours of airing. A good idea might be to charge a subscription for access to ad-free or HD streams as well as making you eligible for discounts off of DVDs for a particular show or season. Consider doing premium editions that come with stuff where a run is printed only if a certain preorder number is reached (like the recent Japanese True Tears BRD release).

Actually, thinking about this model more, it might be a good idea to license one or two shows per season that you are fairly confident will do well. It's probably a good idea to reduce your scope to a particular niche. That way, you can focus on licensing goods and merchandise within this narrow scope and you gain a reputation and solidify your credibility among a particular fanbase. Digital offerings of OP/ED or other anison for cheap on iTunes or something might be a good idea, especially since it won't have the risk of Japanese otaku reverse importing (they like physical media). But this is important, since the entire point of late-night anime is to push DVDs and merchandise.

Staying within this idea of the niche, we can also look at doing the whole gamut of stuff (not just anime) and go into publishing, with stuff like light novels and manga. Consider doing internet serializations for these things instead of print (yes, even for light novels). Maybe consider doing translation and localization for some games or something. Cross-media franchises are pretty big. Flirt with the idea of looking at doujin works (this might be a stupid idea). The idea is to diversify the different income streams but focus on a particular demographic. Since this is North America, the general public is a lot less receptive to the idea of Japanese works, so focus on solidifying the fanbase you already have in ways that mitigate the effects of piracy.

What if you get crap licenses? Stream them and cut your losses. They aren't doing you any good trying to get pushed as DVDs.

I definitely agree with ShiroiHikari's suggestions, in particular the point about getting kids in. There is a clear demarcation of different generations of North American anime fans, marked by Pokemon. But more than just drawing kids in, put a strategy in place so that anime "grows" with the kids. If all you're relying on is Pokemon or Yu-Gi-Oh, the kids you've got are going to grow out of it and it'll be harder to get new kids. Introduce them to other works in your catalogue to keep them interested in the animus. This goes along with focusing on a niche from above, where you introduce them to more and more works that they are likely to enjoy rather than licensing everything under the sun.

Obviously, once you have something going, you can broaden the focus of your fledgling company.

Also important is building a solid reputation. Whatever happens, do not whine about fansubs, because at the very first moment you do, you've pretty much guaranteed you've just antagonized potential customers. With the brand new world of the Internets, communicating your intentions with fans is very easy. This is a way to facilitate building your credibility with the niche you're trying to cater to.

Of course all of this still leaves you at the mercy of the Japanese publishers and is something that I have not accounted for in any serious way.

[rocklobster]

One of the things I love about anime is its maturity. In the US, animation is still seen as something for children only, despite cartoons like South Park. But even cartoons like South Park are childish in a different way. They are immaturity disguised as maturity. Just because you can talk about sensitive topics doesn't mean you should do it for pure shock value.
Anime tends to talk about sensitive topics but it's done for plot. Take Now and Then. [spoiler]Sarah is raped offscreen, but it drives the plot. Her decision to have the child results from the character development she received.[/spoiler]
What I want to say here is that in order to save the R1 industry, we will need to overcome this obstacle. As long as animation is seen as childish, anime will always be a hard sell.

[Blitzkrieg1701]

First and foremost, I'd team up with a Japanese company. I don't just mean have a close relationship with the company I was licensing things from, I mean BE that company. The Japanese and American groups would be two parts of the same entity, and the material that entity produced would be Japan/US co-productions. This would solve a LOT of problems for all parties concerned. The Japanese company would have someone to shoulder the burdens of production, a guaranteed US release, and a way to bypass the increasingly bad local market. The deal's even better for the R1 market: there's no bidding war for shows we want, we have creative input in said show, we can produce material that's more easily marketable to US audiences and make sure it actually gets marketed that way, we could make simultaneous worldwide releases possible, AND you can't tell me that dubs would be better with someone who speaks English working on the original writing. I just can't see the current "they make it, we license it" model sustaining itself much longer, I'm not going to try and sell something I had no active role in creating.

So, that's step one: hook up directly with a Japanese studio and start creating new material from scratch. Since that step alone would be a major undertaking, and actually funding a production from scratch would cost a lot more than just licensing a finished work, we'd probably have to creep along with one project at a time for a while. Said projects would be aimed at the sort of audience that doesn't usually watch anime, but could be sucked in if something looked cool enough. In other words, we'd be trying to make the next Cowboy Bebop: something cool mature, and most likely not attached to any pre-existing franchise. So yeah, I'd also avoid doing kiddie stuff, at least until the company was established.

Also, if possible, I'd try to put an emphasis on feature-length productions rather than TV material. Live action TV looks more like the movies every day, but I don't know if anime can really compete on a TV budget and production schedule. Maybe I'd get into TV once the company was established enough to really dump a lot of resources into every episode, but at first I'd probably stick to movies.

And also, streaming. Dear Lord, there is simply NO reason not to embrace the direction all the consumers are going anyway. Stream everything, right away. That's not to say that I'm breaking the "you must still produce something physical" rule, though. I'd just make sure that there's a REASON to pay for a DVD instead of streaming for free. Every physical release would be loaded with a TON of extras. Not silly promotional material wedged in the case, I'm talking about actual, meaningful bonus material on the disk: multiple commentaries, behind the scenes stuff, all kinds of extras. And it'd be a lot easier to come up with this stuff, too, since we'd actually be involved with the production from the planning stages.

From there, the success of this idea would rest entirely on how well the stuff we produced actually sold, and I can't really predict that, can I?

[blkmage]

Off the top of my head, I'd whittle down the number of our licenses to maybe half a dozen TV shows and one full length feature film per year and put the remaining licensing budget into marketing the crap out of those handful of shows or possibly lobbying for a big-seller to go onto Adult Swim (and maybe making some quality pieces of merch).

The problem here is the assumption that you won't get forced with awful licenses as part of a package with a very enticing license. What is your plan to deal with the Kiss x Sis equivalent that you might end up with to get your FMA-equivalent?

What I want to say here is that in order to save the R1 industry, we will need to overcome this obstacle. As long as animation is seen as childish, anime will always be a hard sell.

This is still one of the problems of the anime industry that Japan is still trying to figure out. Good luck with that one.

First and foremost, I'd team up with a Japanese company. I don't just mean have a close relationship with the company I was licensing things from, I mean BE that company. The Japanese and American groups would be two parts of the same entity, and the material that entity produced would be Japan/US co-productions. This would solve a LOT of problems for all parties concerned. The Japanese company would have someone to shoulder the burdens of production, a guaranteed US release, and a way to bypass the increasingly bad local market. The deal's even better for the R1 market: there's no bidding war for shows we want, we have creative input in said show, we can produce material that's more easily marketable to US audiences and make sure it actually gets marketed that way, we could make simultaneous worldwide releases possible, AND you can't tell me that dubs would be better with someone who speaks English working on the original writing. I just can't see the current "they make it, we license it" model sustaining itself much longer, I'm not going to try and sell something I had no active role in creating.

So, that's step one: hook up directly with a Japanese studio and start creating new material from scratch. Since that step alone would be a major undertaking, and actually funding a production from scratch would cost a lot more than just licensing a finished work, we'd probably have to creep along with one project at a time for a while. Said projects would be aimed at the sort of audience that doesn't usually watch anime, but could be sucked in if something looked cool enough. In other words, we'd be trying to make the next Cowboy Bebop: something cool mature, and most likely not attached to any pre-existing franchise. So yeah, I'd also avoid doing kiddie stuff, at least until the company was established.

Also, if possible, I'd try to put an emphasis on feature-length productions rather than TV material. Live action TV looks more like the movies every day, but I don't know if anime can really compete on a TV budget and production schedule. Maybe I'd get into TV once the company was established enough to really dump a lot of resources into every episode, but at first I'd probably stick to movies.

First of all, for North American audiences, movies are unsustainable. In that light, why would a Japanese company want to fund a movie for distribution in North America when the North American portion will likely lose money? Also, anime movies in Japan typically run on a very limited number of screens, which is why they make so much money compared to TV shows.

Secondly, how do you plan to fund your operation while you're creating your alleged mega-hit? How will you convince any Japanese partners to fund or collaborate on this project?

Thirdly, the main problem with getting in on funding projects in Japan is that, as bad as the Japanese market is, it's still orders of magnitude more reliable than the North American market. Unless you had a lot of money behind you, there's no way you could get funding for a show that targets outside of the core Japanese audience.

[minakichan]

First and foremost, I'd team up with a Japanese company. I don't just mean have a close relationship with the company I was licensing things from, I mean BE that company. The Japanese and American groups would be two parts of the same entity, and the material that entity produced would be Japan/US co-productions.

Definitely believe in this, and it seems to be happening more! I think we have yet to see if releases produced this way can match (or surpass; the bar's low enough that it's really not that hard) the quality of existing R1 releases. I think one problem is that if R1 companies don't particularly care about translation fidelity and liner notes and such, things that "fans" really look for, Japanese companies might care even less though.

One thing I will say: Aniplex of America's advertising of the Gurren Lagann movies is AWFUL from a graphic design standpoint, which makes me imagine that they don't have anyone on board who understands North American advertising... I wouldn't be surprised if a lot of people skipped over looking at their banner ads just because in terms of visual cues, they look more like ads for some bootleg anime seller than a legit anime release.

The problem here is the assumption that you won't get forced with awful licenses as part of a package with a very enticing license. What is your plan to deal with the Kiss x Sis equivalent that you might end up with to get your FMA-equivalent?

Oh god, I know someone who actually watches that show; I think I should stop being friends with him.

I wonder if it would be reasonable to accept those package deals and really push for the hits and not even bother with a DVD release for the crap...

First of all, for North American audiences, movies are unsustainable. In that light, why would a Japanese company want to fund a movie for distribution in North America when the North American portion will likely lose money? Also, anime movies in Japan typically run on a very limited number of screens, which is why they make so much money compared to TV shows.

Even for straight-to-DVD film releases? From my limited understanding, I figured that some of the decent movies not tied to an anime actually did OK here. Also, I feel like people are more likely to buy physical copies of movies than of TV series; it just feels more natural to an audience that is more willing to buy a DVD of a Hollywood film than of a sitcom season.

[ShiroiHikari]

For the record, I do not think that making anime have more "Western" appeal is the answer to the R1 industry's problems. If it was Western, it wouldn't be anime-- if you get my drift. There's nothing wrong with Western tastes-- and perhaps I'm alone in this --but I like anime because it isn't Western.

Even if a company did try to make the next Cowboy Bebop, would it succeed? Rather than trying to make the "next big thing", they should just concentrate on making good, solid shows. Japan has been dropping the ball a bit on that, if you ask me, but then, so has the US.

[minakichan]

For the record, I do not think that making anime have more "Western" appeal is the answer to the R1 industry's problems. If it was Western, it wouldn't be anime-- if you get my drift. There's nothing wrong with Western tastes-- and perhaps I'm alone in this --but I like anime because it isn't Western.

When people try to do that, they end up making stuff like Heroman... which isn't terrible, but it isn't great either IMO.

[blkmage]

[quote="minakichan (post: 1391491)"]Even for straight-to-DVD film releases? From my limited understanding, I figured that some of the decent movies not tied to an anime actually did OK here. Also, I feel like people are more likely to buy physical copies of movies than of TV series]
Movies probably do okay, but I don't think they do well enough or have enough releases throughout the year to be able to keep a company afloat on their own.

[MasterDias]

Actually, thinking about this model more, it might be a good idea to license one or two shows per season that you are fairly confident will do well.

Somewhat easier said than done I think. Companies have been burned before by licensing stuff early that turned out to be duds, or at least, fairly unsuccessful sales-wise.

The problem here is the assumption that you won't get forced with awful licenses as part of a package with a very enticing license. What is your plan to deal with the Kiss x Sis equivalent that you might end up with to get your FMA-equivalent?

Actually, it appears package deals are a thing of the past now, if the reps at Funimation's online video panel they had a few weeks ago are to be believed. Everything is now on individual licenses.

Some people had sort of assumed when Funimation licensed Dance in the Vampire Bund and Baka & Test that one of them was part of a package deal to get the other. But, that is evidently not the case, according to the Funi guys. This surprised me as well.

I wonder if it would be reasonable to accept those package deals and really push for the hits and not even bother with a DVD release for the crap...

I'm pretty sure there are contract stipulations that force them to release the shows on physical media.

For the record, I do not think that making anime have more "Western" appeal is the answer to the R1 industry's problems. If it was Western, it wouldn't be anime-- if you get my drift. There's nothing wrong with Western tastes-- and perhaps I'm alone in this --but I like anime because it isn't Western.

Even if a company did try to make the next Cowboy Bebop, would it succeed? Rather than trying to make the "next big thing", they should just concentrate on making good, solid shows. Japan has been dropping the ball a bit on that, if you ask me, but then, so has the US.

Problem is "Western" fans in general tend to have different tastes than what the Japanese "otaku" are into. That's why Funimation traditionally went for stuff like Gonzo scifi shows and the shonen action shows, over stuff like K-On!

What's popular online can be pretty misleading as far as US sales are concerned. Even online hits like Gurren Lagann, Haruhi, and Lucky Star have underperformed (or flat out bombed in the last case, I think) Now, there were other factors involved in those examples (GL had a fairly screwy release,) but it's caused the US companies to be pretty hesitant regarding online popularity.
To be honest, I think all the companies except Funimation have really failed at trying to market their properties. So, that's what I would try to focus on.

[blkmage]

I'm pretty sure there are contract stipulations that force them to release the shows on physical media.

About this, I've heard that one of the biggest reasons CR doesn't get as many shows as it would like is because Japanese companies tend to refuse to split streaming and DVD rights.

Also, Funimation willingly took Dance in the Vampire Bund? LOLOLOLOLOL

[rocklobster]

Also, Funimation willingly took Dance in the Vampire Bund? LOLOLOLOLOL

It's Twilight's popularity. It has to be.

[Mr. Hat'n'Clogs]

It's Twilight's popularity. It has to be.

No one is going to mistake Dance in the Vampire Bund for Twilight, no matter how much the Twilols want bad vampire romance. Lolicon and female wish fulfillment are too far apart, even if they do both contain some sort of vampire. Funimation isn't that stupid, just stupid enough to buy a lolicon show.

[minakichan]

It's Twilight's popularity. It has to be.

Clearly, you have not seen Dance in the Vampire Bund...

[Nate]

What I don't get is they licensed it and then they censored it. Apparently they have rocks instead of brains in their heads. The only people who would be interested in the show are the ones who are going to flat-out refuse to purchase it if it's edited.

Now I know why they edited it. It's perfectly understandable why they did. But if they were going to cheese off the only audience interested in buying the show, why even bother to license it? I mean really.

[MasterDias]

Bizarrely, it appears the Japanese license holders made Funimation think it was actually worse than it was. Although, they could have taken note that the DitVB manga has been released here unedited, and Funi themselves have released worse stuff(RIN...)

Funimation backpedaled pretty quickly though and it now appears that the DVD release will be uncut anyway...so it's pretty much a moot point. But that whole situation was pretty strange, and just plain poorly handled on a number of levels. Chasing off your niche target audience is always a really bad move.

[rocklobster]

Bizarrely, it appears the Japanese license holders made Funimation think it was actually worse than it was. Although, they could have taken note that the DitVB manga has been released here unedited, and Funi themselves have released worse stuff(RIN...)

Funimation backpedaled pretty quickly though and it now appears that the DVD release will be uncut anyway...so it's pretty much a moot point. But that whole situation was pretty strange, and just plain poorly handled on a number of levels. Chasing off your niche target audience is always a really bad move.

yeah, i heard there was quite a backdraft. Some were even threatening to boycott. Thankfully Marzgurl just said we should just not buy the title to "teach FUNimation a lesson", so to speak.

[Mr. Hat'n'Clogs]

yeah, i heard there was quite a backdraft. Some were even threatening to boycott. Thankfully Marzgurl just said we should just not buy the title to "teach FUNimation a lesson", so to speak.

I really hope you don't buy the title anyways Rockolobster, that would be extremely creepy.

[Nate]

Funimation backpedaled pretty quickly though and it now appears that the DVD release will be uncut anyway...so it's pretty much a moot point. But that whole situation was pretty strange, and just plain poorly handled on a number of levels. Chasing off your niche target audience is always a really bad move.

Right, which is why I think that even though Seven Seas kind of pulled a jerk move by not releasing Kojikan in America, it probably was overall the better thing to do than releasing a heavily edited version. Kind of like what CMX did with Tenjho Tenge which caused all sorts of outcries.

[Ingemar]

Get the R2 anime industry to get its act together first. THEN we'll talk about saving the R1 industry.

[rocklobster]

Here's another idea: Re-licensing! A lot of great titles are being lost to time. Get those old titles so new generations can enjoy them. And yes, people will buy old-school.

[KhakiBlueSocks]

[font="Trebuchet MS"][SIZE="4"][color="RoyalBlue"]The only two things I can think of doing:

1. EVERYTHING done in-house. Dubbing, marketing, distribution, etc...

2. Push the physical formats in as many places as I possibly can; "Wal-Mart", "Target", etc...[/color][/SIZE][/font]

[ShiroiHikari]

I thought they already tried both of those things.

[Rusty Claymore]

My strategy would be to sell soap to my friends.
(Well, any other response to this thread would require an economic study and I am out of chips.)
That or fire all the unhappy people.
So I'd better not ever be the CEO, huh?

[blkmage]

Here's another idea: Re-licensing! A lot of great titles are being lost to time. Get those old titles so new generations can enjoy them. And yes, people will buy old-school.

Someone will probably buy it because they missed out on it. The number of people who will buy it will not be large enough to make the returns justify the cost of doing so, mostly for the sole reason that most people who would have bought it already did. This is also not a very winning strategy for sustainability as it does nothing to either grow the market or grow revenue sources.

[font="Trebuchet MS"][SIZE="4"][color="RoyalBlue"]2. Push the physical formats in as many places as I possibly can][/SIZE][/font]

This only makes sense if the title you're pushing is for a general audience. Most anime doesn't fall into this category, so such a large distribution of physical media (especially when people are less likely to buy physical media) will probably cost orders of magnitude more than whatever you'd make. It's the mistake of not recognizing that anime is a niche and acting accordingly.

[Nate]

Yeah, space is pretty limited at places like Wal-Mart. They aren't like Best Buy, who have a lot of extra shelf space for stuff, Wal-Mart has a fairly small electronics section, and they're not going to stock DVDs of say, Higurashi on their shelf if it isn't a big-seller. That's why the only anime Wal-Mart tends to have is Naruto, Bleach, and Pokemon. They did have Death Note for a while, but the sales of that show are more or less over, and even Bleach is getting hard to find on their shelves these days.

[Yamamaya]

Yeah, space is pretty limited at places like Wal-Mart. They aren't like Best Buy, who have a lot of extra shelf space for stuff, Wal-Mart has a fairly small electronics section, and they're not going to stock DVDs of say, Higurashi on their shelf if it isn't a big-seller. That's why the only anime Wal-Mart tends to have is Naruto, Bleach, and Pokemon. They did have Death Note for a while, but the sales of that show are more or less over, and even Bleach is getting hard to find on their shelves these days.

I did see Monster and Morbito at Wally world for a while.