Theatrical or Straight to Streaming? Here’s the Movie Market Researcher Who Makes Those Tough Calls

Sony's 'Spider-Man: No Way Home'
Sony's 'Spider-Man: No Way Home,' which became the first film to gross $1 billion in the pandemic era, is an example of a studio deftly figuring out where a project should go, and what budgets and marketing campaigns get attached to it. (Image credit: Sony Pictures)

Kevin Goetz has been tinkering with other people’s movies for 35 years. And these days, his tinkering as one of Hollywood’s go-to market research specialists is changing quickly, from tweaking the back end to deciding way up front what actually goes to theaters instead of straight to streaming.

Making those decisions will become ever more important as audience options approach infinity, marketing costs continue to rise, and clicking away to something else takes milliseconds. That’s where people such as Goetz, founder and CEO of Screen Engine/ASI, come in. 

Goetz is a long-time member of a small fraternity of film market researchers advising Hollywood about how to make their products more appealing, sometimes with small tweaks, sometimes with massive changes, like keeping a beloved character alive. 

(Image credit: Screen Engine/ASI)

For decades, Goetz focused on movies, observing audiences as they’ve watched more than 7,000 films, then interpreting the data culled from those audiences to spotlights problem areas. His 300-person company still works on plenty of movies, but these days also weighs in on TV shows, streaming programs and even video games.

Goetz and co-author Darlene Hayman recently released Audience-ology, an insider look at film market research, where moguls quiver and directors rage at the hard numbers of audience reaction to their prized projects. 

Though such audience research dates back to Buster Keaton screening bits from his black-and-white silent films to audiences on Hollywood Boulevard a century ago, its evolution ever since tracks Hollywood’s growing dependence on data, especially amid streaming’s rise and the pandemic’s reach. 

The growth has continued even though audience testing can be excruciating for creators. As director Ed Zwick puts it, watching test audiences see your project is “like seeing your lover naked for the first time.”

“A test screening is judgment time, the moment of reckoning, the moment of truth,” Goetz writes. “For the audience, it’s a few hours of their day. But for the people involved in making the movie, it’s often the climax of many years of their lives. It can also be their career­-defining moment, and the results determine how the next chapter of their career will play out.”

Asked where he sees the industry going, Goetz says, “To me, the biggest change is people want to see lots of different things but they want to see more carnival rides or eventized entertainment in the theater. People are making more difficult choices now because of the (wide selection), the price, and convenience converging together for the first time in this perfect storm. Someone described a movie I tested the other night as a female Shawshank Redemption. And everyone was saying afterwards, ‘Well, I'll take that.’ And I'm thinking to myself, ‘Well, no one would make Shawshank Redemption theatrically today.’ It would never be (a) theatrical (release), because who would take the risk?”

It’s the difference between Spider-Man: No Way Home, which became the first film to gross $1 billion in the pandemic era, and Steven Spielberg’s much-lauded and little-seen remake of West Side Story. Hollywood companies are slowly figuring these things out, making decisions earlier than ever about what projects go where, and what budgets and marketing campaigns get attached to them. 

Goetz is sanguine about where the entertainment industry is headed, given its ability to navigate the changes forced by television and then pay TV, though he’s more skeptical about the long-term health of theatrical exhibition as distributors have to figure out which projects can recoup a pricey budget and then a wide release in traditional venues. 

“We always had the distributor in charge of the messaging, right?” Goetz said. “Here are the movies coming out, choose from two of them, three of them. That's it. And if you don't like it, lump it.” 

That’s changed in an era of endless content and distribution options, where marketing matters more than ever.

“Getting people to pay attention to all this fabulous, incredible content is really tough,” Goetz said. “So what's been more effective is we've had to pivot (to) advertising testing, where we test advertising content. Digital advertising has different rules and ways of reaching people than traditional linear trailers and 30-second commercials.”

Screenings for streaming projects initially weren’t much different from those for theatrical movies, except for one thing. Testing for streaming-bound shows typically was held in smaller theaters, with lounge seating and easy access to food options, just like a streaming audience would have at home.  

The pandemic forced an even bigger transformation, leading Screen Engine to launch VirtuWorks, an online testing system that allows executives to monitor and replay the reactions of dozens of viewers simultaneously. The shift turned out to be “a happy discovery for many clients, particularly for the streaming services, and the perfect way in which to test content for in-home viewing.” 

Now, even theater-bound movies are getting early-round tests online, because “you just need a smaller number of folks just to be exposed to the film, to have a laboratory to play with. I actually see movies getting better as a result of this.”

Screen Engine “now includes a battery of questions to gauge the level of theatergoing worthiness, identifying films that must be seen on the big screen versus those that can be enjoyed just as much at home,” according to the book.

And one of Screen Engine’s biggest growth areas is what Goetz calls “capability testing. It measures the DNA (of a film).” 

Only some projects have the “DNA” to become an “eventized” project that can draw across most of the demographic sectors Screen Engine tracks. “Tweener” projects, meanwhile, are getting stiffed in theatrical releases, which suggests many should have gone straight to streaming.  

“So you have to then make the decision before and not after: ‘Is this a movie that's going to a streamer, or it's going to streaming because you can’t make it for too much money?’ That cannot be overstated: It's much better to predetermine what the movie’s fate is, from a budgetary standpoint, before you begin shooting a frame of film.”

What gets lost in that process? Goetz points to Forrest Gump, which several studios passed on before it won multiple Oscars and became a culture-defining hit for Tom Hanks and Robert Zemeckis in the 1990s. A unique and hard-to-define project with a clunky name like that probably wouldn’t get the green light today, certainly not for theaters. 

It’s part of a bigger reckoning just ahead for theaters and the studio business models that rely on regular theater attendance, said Goetz, pointing to recent research his company did looking at generational movie-going habits. 

As Baby Boomers die off and take their theatergoing habits with them, a brutal cliff of disinterest looms among GenZ and younger cohorts, who have lots of other ways to fill their time. 

That’s good news for the streaming services, and game makers too. And it will make the work of companies such as Goetz’s more important than ever, playing traffic cop for projects before a scene gets shot, and then spotting and filling the holes in the near-final product.  

As Goetz wrote, “The industry is evolving, and movie consumers aren’t necessarily moviegoers.”

David Bloom

David Bloom of Words & Deeds Media is a Santa Monica, Calif.-based writer, podcaster, and consultant focused on the transformative collision of technology, media and entertainment. Bloom is a senior contributor to numerous publications, and producer/host of the Bloom in Tech podcast. He has taught digital media at USC School of Cinematic Arts, and guest lectures regularly at numerous other universities. Bloom formerly worked for Variety, Deadline, Red Herring, and the Los Angeles Daily News, among other publications; was VP of corporate communications at MGM; and was associate dean and chief communications officer at the USC Marshall School of Business. Bloom graduated with honors from the University of Missouri School of Journalism.