Ancillary Revenue
From ForcaWiki, the simple encyclopedia
| In one sentence | Money a movie earns from its characters, story, and name, like toys, sequels, and streaming deals, instead of from theater tickets. |
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| Category | Film and Television |
| Related | Box Office Receipts, Comparable Films (Comps) |
Imagine your lemonade stand gets so popular that you start selling a "Lemonade Stand" t-shirt and a little recipe booklet alongside your actual lemonade. The lemonade itself is your main product, but the shirts and booklets earn you extra money based on your stand's name and idea, not on how much lemonade you pour.
Movies work the same way. Box Office Receipts is money earned specifically from people buying tickets to watch the film in a theater. Ancillary revenue is everything else a movie earns based on its characters, story, and brand, rather than on ticket sales: things like toy and merchandise licensing, video games, theme park rides, streaming and television licensing fees, soundtrack sales, and the rights to make sequels or spinoffs.
Why studios care so much about it
For some movies, especially ones built around toy-friendly characters or a world that can support sequels, ancillary revenue can end up being worth far more than the box office receipts ever were. Because of this, a studio sometimes greenlights a movie partly because of how well its characters might sell as action figures or how many sequels its world could support, not only because of how many tickets it expects to sell.
Fun facts
- A movie's soundtrack, action figures, and video game tie-in can keep earning money for years after the movie itself has left theaters completely.
- Studios often plan a franchise's ancillary revenue, like sequels and merchandise, before the very first movie is even finished, betting on the characters becoming popular.
- When people study comps to judge a new project, they usually look at both box office receipts and ancillary potential, since a movie with weaker ticket sales can still be a great investment if its characters sell well elsewhere.