The Asylum: Mocking Their Way Through Hollywood
(5 pages of text)
Case (Pub Mat)
The co-founder and chief executive officer of The Asylum, a movie production company headquartered in Burbank, California, must decide whether the company needs to explore other avenues for growth or change its current business model to boost profitability. The company has developed a unique imitation strategy to reduce the uncertainty of financial success in filmmaking – its “mockbuster” business model is to produce B-rated movies that use plotlines similar to that of major Hollywood films already in production and release them at the same time as or just before the comparable Hollywood film. It can thus take advantage of the large marketing and promotion campaigns that large film production studios employ to promote their films while producing a substantially cheaper (but somewhat similar) film. To date, all of these mockbusters have been profitable, but changes to property rights regulations and increased litigation cases may come to affect the bottom line. There are three options going forward: maintaining the status quo, focusing even more on producing mockbusters or shifting toward completely original film production. What should the company do to ensure future success?
This case is ideal for a marketing or strategy course at the undergraduate or MBA level and is most relevant to the topics of imitation strategies and how effective strategies can deal with uncertainty. Its objectives are:
- To highlight how even relatively small firms can continuously succeed in a highly competitive industry where many larger, well-established companies often encounter high rates of failure.
- To analyze and understand whether or not the business model offers a stable competitive advantage and how it effectively reduces uncertainty and failure in an industry as sensitive to consumer tastes and demands as the movie production business.
Arts, Entertainment, Sports and Recreation
United States, Small, 2015
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