Pre-Oscar parties provide not-so-little economic boost

oscars.jpgWe know all about the glamorous soirees during and after the ceremonies - as well as numerous events on Saturday - but the Oscar hubbub is happening the entire week, with several dozen functions. Tonight, for example, it's the Costume Designers Guild Awards After-Party, as well as a benefit for the L.A. Fund for Public Education that features the cast of "Les Miserables." Vanity Fair has several events throughout the week, topped by its annual Oscar Viewing Party on Sunday. (Deadline's Nikki Finke has the full list.) Guesstimates have been made over the years on the local economic impact - the number often cited is $130 million, but that's based on an analysis several years ago that I didn't believe even then. Truth is no one knows, though for an economy as large as L.A.'s, the money being spent for these galas will not stand out (unless you're trying to book a caterer for your son's Bar Mitzvah). But it is a reminder of how entrenched the entertainment industry is in L.A. Speaking of all things Oscar, Tuesday afternoon's deadline for Academy ballots marks the end of what has been a frenzied - and expensive - campaign season. From this week's Business Update on KPCC:

Mark Lacter: Well, you've probably been noticing all the TV commercials, newspaper ads, infomercials, billboards, interviews, and most every kind of marketing technique that you'd see during the final weeks of a political campaign. The ad efforts really began last fall, but in these last few weeks the two films duking it out are "Lincoln" and "Argo." "Lincoln" was an early favorite to take the top prize, but its chances have been fading quite a bit, and now, according to the folks who follow this, "Argo" is the overwhelming pick to be named Best Picture.

Steve Julian: What kind of money is involved in all this?

Lacter: The figure generally tossed around is $10 million for each of those films, which is around double the usual amount. Throw in the other films, and you're probably looking at the costliest ad campaign ever. (And, as with political campaigns, there's no limit to how much a studio can spend on advertising.) Now, what we're seeing in L.A. is not aimed at the general moviegoer, but rather Academy voting members, who - by the way, Steve - have until 5 p.m. this afternoon to cast their ballots (the awards are presented on Sunday).

Julian: What does spending $10 million on advertising mean for studios?

Lacter: It could generate millions more at the box office, and also from the sale of DVDs. And, from an image standpoint, winning can be a huge deal for a studio by attracting both talent and investors willing to bankroll future films. And, one more sign of better times in Hollywood (and the local economy) are the increased number of Oscar parties this year compared with 2012 - and certainly compared with the recession years. They're clearly not spending that kind of money in Texas.

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Mark Lacter
Mark Lacter created the LA Biz Observed blog in 2006. He posted until the day before his death on Nov. 13, 2013.
Mark Lacter, business writer and editor was 59
The multi-talented Mark Lacter
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