Risky Business pp7

Question 1

Risky Business

Answer 1

Risk is found in all human activity
Very little consensus about how to define risk
Risk is something which can be measured – 1921- Frank knight
Holton- 2004- for risk to exist the following conditions must exist-
Uncertainty about potential outcomes
Outcome has to matter in terms of providing utility
Example: Jumping out of an airplane with no parachute is not risk

Question 2

What is a risk?

Answer 2

Common definitions:
A situation involving exposure to danger.
To expose someone or something to danger, harm, or loss.
Business definition: NYU School of Business
“…a combination of danger and opportunity…”

Question 3

History of Risk

Answer 3

Current existence possible due to risk
Someone has to be willing to take a risk and challenge the status quo
We are exposed to risk everyday- deliberate and not deliberate
Risk and survival have gone hand in hand
Prehistoric humans- short lives
Physical risk and reward went hand in hand- risk taker->
food/mate/chance of survival

Question 4

More on History of Risk

Answer 4

Transportation created further risk
Shipping->wealthy risked their finances
Poor risked their lives
Risk provides opportunities and rewards
Also uncertainty and loss

Question 5

How does production work To reduce risk?

Answer 5

SURPLUS of talent
This talent must meet needs of PROFIT SEEKING firms
Talent pushes up against an INPUT BOUNDARY
Filter to select small group of creative talent
BOUNDARY SPANNERS help in the process
Boundary Spanners Agents, Managers, Scouts, Others
OUTPUT BOUNDARY
Output Boundary- Sales, Marketing, Publicity, Advertising
GATEKEEPERS Select and disseminate a handful of products to the public

Question 6

Input and output boundaries

Answer 6

Boundary spanners- people that connect artists and firms
Audition
Social events
Networking
Input boundary may be broken
Manufacture the product- music, movie, book, program
Marketing
Interviews
Promotional events
Contests
Publicists
Sales
Breach the Output boundary- filter to reach the audience

Question 7

Products aim for…

Answer 7

Surrogate consumers- a commercial enterprise, consciously engaged and paid by the consumer or other interested party on the behalf of the consumer to make or facilitate selection decisions on behalf of that consumer.

Question 8

Potential social Risks

Answer 8

Surrogate shoppers might behave contrary to the interests of the clients they represent
Might have a powerful vested interest in preserving their own businesses
Incompetence and mistakes in judgment may be compounded by maliciousness, mismanagement, greed, and fraud
The decision criteria of surrogate shoppers may differ significantly from those of clients.

Question 8

Potential social benefits

Answer 8

Protection from harm and efficient use of resources
Surrogates often possess greater knowledge- Market Maven/Opinion Leader
Have made a large volume of similar decisions

Question 9

How do surrogate consumers make decisions?

Answer 9

Marketing may reach out to gatekeepers such as EW, People, New York Times, Washington Post
These opinion leaders/market mavens/connectors/surrogate consumers then pick some products
Review those products
Amazon- Vine Voice
Payola= Pay + Victrola- illegal in 1960
Independent Record Promoters- also illegal
Payments made for high visibility displays
SYNERGY- media conglomerates that own a variety of media

Question 10

Minimizing risk

Answer 10

Adhere to CULTURAL CONVENTIONS
Established genres, topics, and styles
Genres- organizational devices- allow for working within known framework
Not fitting in to a genre can make marketing and salability difficult
Human beings categorize and go with the known

Question 11

Production Perspective

Answer 11

Producers have to be careful on what they make a film on

Question 12

Hollywood Surefire

Answer 12

cc

Question 13

Who is Frank Knight?

Answer 13

Risk is something that can be measured

Question 14

RISK: UNCERTAINTY OF POTENTIALLY OUTCOMES

Answer 14

Not knowing what will happen

Question 15

Risk in 2 words!

Answer 15

RISK IS A COMBINATION OF DANGER AND OPPORTUNITY!!!

Question 16

What did Holton say?

Answer 16

Holton- 2004- for risk to exist the following conditions must exist-
Uncertainty about potential outcomes
Outcome has to matter in terms of providing utility
Example: Jumping out of an airplane with no parachute is not risk

Question 17

What does risk must have?

Answer 17

Someone has to be willing to take a risk and challenge the status quo
We are exposed to risk everyday- deliberate and not deliberate

Question 18

Rich and Poor Risks:

Answer 18

poor are risking their lives=
Rich was risking their wealth

Question 19

What makes a fluke risk?

Answer 19

Chance does.

Question 20

How does production work To reduce risk?

Answer 20

SURPLUS of talent
This talent must meet needs of PROFIT SEEKING firms
Talent pushes up against an INPUT BOUNDARY
Filter to select small group of creative talent
BOUNDARY SPANNERS help in the process
Boundary Spanners Agents, Managers, Scouts, Others
OUTPUT BOUNDARY
Output Boundary- Sales, Marketing, Publicity, Advertising
GATEKEEPERS Select and disseminate a handful of products to the public

Question 21

Boundary spanner:

Answer 21

Boundary spanner: person and agency that are looking for ppl that have a certan talent. They seek ppl to bring into their movie

Question 22

Gatekeepers:

Answer 22

Gatekeepers: they are the ones who decide who ppl with talent make it out to the public

Question 23

Surrogate consumer

Answer 23

Surrogate consumers- a commercial enterprise, consciously engaged and paid by the consumer or other interested party on the behalf of the consumer to make or facilitate selection decisions on behalf of that consumer.

Question 24

Surrogate shoppers: Influence in ppl

Answer 24

Protection from harm and efficient use of resources
Surrogates often possess greater knowledge- Market Maven/Opinion Leader
Have made a large volume of similar decisions

Question 25

SYNERGY

Answer 25

SYNERGY- media conglomerates that own a variety of media
EX: DISNEY GET PPL TO BUY SHIT, FAMOUS

Question 26

GENRE

Answer 26

GENRE: It allows ppl to know what to expect.
Safe way to push a product

Question 27

What is Paola?

Answer 27

Paola: Pay+Victrola-illegal in 1960s, a lot of bribing to get good reviews, BUT ARE LIES

Question 28

How do films minize risks?

Answer 28

STICK TO RULES OF CULTURE AND GENRE

Adhere to CULTURAL CONVENTIONS
Established genres, topics, and styles
Genres- organizational devices- allow for working within known framework
Not fitting in to a genre can make marketing and salability difficult
Human beings categorize and go with the known

Question 29

The secondary market

Answer 29

Alternative opportunities to generate profit from a cultural product beyond its domestic sale in its original format
Risk minimizers
Development and productions costs are already dealt with
Flops can be transformed in to hits in the secondary market
Syndication (television shows)
Certain shows created for syndication
Content tends to follow formula- CSI

Question 30

Overproduction

Answer 30

EX: JURASSIC PARK, THEY MADE A LOT OF MONEY AND THEN FAILED

Another way to minimize risk
Overproduce the product
One or two products are hopefully bound to take
Some may become sleeper hits
Overproduction allows for the production of products which
would otherwise not have seen the light of day
For example: The success of Jurassic World allowed for the losses
from Blackhat to be less painful

Question 31

Sequels/prequels/remakes/spinoffs

Answer 31

THEY EXPAND THEIR UNIVERSE TO CONTINUE THE LEGACY OF THE MOVIE
They already have an audience aimed from the past and they will be successful

EX: MY LITTLE PONY
they make the new show so much nicer and fun

Question 32

Profit

Answer 32

In the music business:
Changes in technology allow buyers to purchase single songs
Profits plummeted between 2002-2010
Fastest growing revenue source today- streaming services
Rights holders are paid as little as $.006 to $.0084 per stream
The music industry powerhouses such as Beyonce, Taylor Swift, Adele keep it going
Winner-Take-All Market
Music created more by professional song writers and producers

Question 33

Formulaic movies

Answer 33

Amazon, Netflix, they invest big money to put it out to the public

Question 34

Stories must stay formulaic

Answer 34

Formulaic stories have dominated
Soap operas
Sitcoms
Who dunnit
The conversation is changing with Netflix, Amazon, Hulu etc.
Creating individual shows which go on to become huge hits

Question 35

Production hits

Answer 35

All mediums go with personnel with proven track records
Actors
Directors
Producers
Studios
Shonda Rhimes- Grey’s Anatomy success How To Get Away With Murder & Scandal

Question 36

MAKING TRENDS

Answer 36

If media is about minimizing risk and garnering profit
Certain trends come to the fore:
Reality TV- inexpensive to produce but can be huge hits- Survivor, Bachelor/Bachelorette

Question 37

Making Trends & Reality TV

Answer 37

Compared to soaps and sitcoms, reality TV is often financed by people “starring” in the show
Very little money paid to reality TV stars (unless you are a Kardashian)
No scripts (really?!) so no writer fees
Flexible norms of production- no set scenario,
no set number of episodes or fewer episodes
Profits, if any, from reality TV can be applied to shows which take
a lot of money to produce
Reality TV can feature brands from corporate sponsors

Question 38

Making Trends & Reality TV

Answer 38

Producers push the main person they wanna win shit on the tv show