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As a movie star, Adam Sandler has been a walking—make that stumbling—anomaly. His comic bits are, well, dopey to the point of distraction. He does his best work when he's mumbling, often in a faux hillbilly accent. And the critics darn near hate him. But his films work where it counts, with the folks who plunk down their $9 or so for his films. His latest, Click, a shameless takeoff on the old holiday chestnut It's A Wonderful Life, uses a remote control that allows a workaholic architect to fast forward and rewind his life. It was skewered by critics ("It's not worth wasting money on," wrote Claudia Puig in USA Today), but it opened strongly to a $40 million first weekend on June 23.
That marks the continuation of a remarkable streak for the 39-year-old Sandler, who also has had big-league hits in recent years with dope-fests like Mr. Deeds and 50 First Dates. The former Saturday Night Live cast member is among the most bankable actors in Hollywood, a guy who usually posts hefty returns for the studio brass who trust millions to put him, and his antics, on the big screen.
Sandler is hardly the leader among the most bankable guys to mug for the camera and see their name up in lights. That distinction goes to Tyler Perry, a playwright and a star to African-American audiences. Perry became a mainstream star with a couple of midsize hits in the last two years—Diary of a Mad Black Woman in 2005 and Madea's Family Reunion earlier this year. Neither film passed the magic $100 million mark reserved for blockbusters, but neither one cost more than $6 million to produce. The result: the 37-year old writer and comedian takes top honors in BusinessWeek.com's ROI Award for Hollywood's big earners.
INVESTING IN ACTORS. The ROI Award goes to the actor who enjoys the highest return on investment for Hollywood studios who pay the freight for their services. As any first-year business student knows, a return on investment is a measure of benefit a company gets for the money it spends to do business. Expressed as a percentage or ratio, it is derived by dividing the benefit of the investment (i.e. the return) by the cost of the investment. In Hollywood terms, that's like trying to catch water in your hand. Costs are hard to get, even harder to decipher in the fantasy world of Hollywood accounting, while the returns are often shared with everyone from producers who once worked on the project to actors with enough pull to demand it.
For the purposes of BusinessWeek.com's ROI award, we relied on published reports of costs estimates, provided by the Web site imdb.com, and applied the 2005 average marketing cost of $36 million a film. (Marketing costs are, of course, higher for larger films but in many cases sponsors help defray those costs.) We also applied the rule of thumb that a studio typically gets the proceeds from approximately half the tickets sold at the U.S. box office and the overall take from the box office is roughly one-third of the money a studio earns after a film has gone to play overseas and becomes a DVD or movie on pay TV.
BusinessWeek.com attempted to assess female stars, but validated one of Hollywood's darkest secrets: Women stars don't necessarily help boost ticket sales. Certainly, some actresses are sure things at the box office, especially Julia Roberts. But Roberts and Angelina Jolie have been virtual no-shows since 2004, headlining only one movie apiece as both started families. And some other major actresses had wildly uneven years: Reese Witherspoon helped turn Walk the Line into a huge hit last year, but didn't do much for Just Like Heaven. The best of the group may well be Jennifer Aniston, who is riding a hot streak with her current film The Break Up and in 2004 starred with Ben Stiller in Along Came Polly, which grossed $87.9 million on a $42 million budget. However, Aniston's other two films during the same period, Rumor Has It and Derailed, either lost money or were break-even propositions. With a sample of films this uneven, BusinessWeek decided instead to sit back and watch their coming performances.
TOP HONORS. For male stars, Perry has a 120% ROI, meaning that for every dollar Lionsgate Entertainment paid in marketing and production costs for his two films, Perry returned $2.20, or a $1.20 benefit to his backers. Of course, how much longer Perry can keep delivering such staggering returns is open to question. Costs for his films no doubt will soon start going up—a Hollywood tradition.
As for some other Hollywood big money players, next on the list were Tom Cruise and Will Smith, who both posted a 53% return on investment for films they've starred in since 2004. (Sandler, by the way, chalks up a 16.8% return for the four films he has starred in over that period, including a projected $125 million box office for Click.)
Among other major actors with hefty returns on investment: Tom Hanks, who showed a return of 43% for the his three films since 2004, which included the mega-hit The Da Vinci Code, and The Terminal, where his box-office draw helped make a ho-hum film with a $60 million budget into a $218.7 million worldwide hit. Hanks just edged Ben Stiller, with a 41% rate of return for the five films he has starred in over that same three-year period, including the low-budget blockbuster Dodgeball, cheapies like Along Came Polly, and the outsized hit Meet the Fockers.
EXPENSIVE EFFECTS. The rankings may well validate the lofty status that Hollywood affords some of its Grade A stars, like Cruise, who commands $20 million or more in salary and a cut of the profits. But it also says a great deal about the kinds of film projects that they choose to create for these biggies. Cruise and Smith share the top spot in large part because of the gigantic special effects and other expenses that go with their films, making them into mega-events with well over $100 million price tags. Cruises' last film, Mission Impossible III, cost $150 million to produce and another $50 million or so to promote. Same for Smith's 2004 flick, I, Robot, which cost $120 million to make.
But the films in which they star in also sell well overseas, where a growing percentage of Hollywood's revenues are now generated. I, Robot sold $347 million worth of tickets worldwide, on top of millions of DVDs in both the U.S. and abroad. When Cruise made War of the Worlds, sales more than doubled overseas and totaled $588.9 million worldwide, according to imdb.com, in no small measure because Cruise shared the film's top billing with director Steven Spielberg. Another ROI finalist, Brad Pitt, had a 30% return on equity for his three films since 2004, which included the sexy shoot-em-up Mr. & Mrs. Smith. That film doubled its $186.3 million U.S. take in large part because of the steamy romance between Pitt and co-star Angelina Jolie.
By contrast, actors like Perry and Sandler, who stars mostly in comedies, rarely get the huge boost from sales in overseas markets, which have traditionally been less receptive to U.S.-style humor. Sandler's film 50 First Dates sold about half the amount of tickets overseas that it sold in the U.S., where it was a $120.7 million blockbuster on a $75 million budget. (Of course, credit his co-star Drew Barrymore, whose name certainly didn't hurt the film.)
PERRY'S PAYOFF. Perry's two films, aimed largely at the U.S. African American audience, didn't play that well overseas. In the U.S., however, they were gold—with Diary of a Mad Black Woman grossing $50.4 million in the U.S. on a $5.5 million budget, and Madea's Family Reunion grossing $63.2 million after costing $6 million to produce. (Because the two films were distributed by independent studio Lionsgate, BusinessWeek also reduced to $20 million the usual $36 million cost of marketing the films.)
Might there have been other actors BusinessWeek.com should have considered? Undoubtedly. We choose to exclude stars who clearly were not the major reason the film was created or shot. That left off Tobey Maguire, who traipsed around in Spiderman 2 in a costume that any other slightly built actor could have worn. The same goes for young Daniel Radcliffe, who donned Harry Potter's glasses for two of the mega-films since 2004.
As for actors who were part of larger ensemble casts, including Stiller in Meet the Fockers, a judgment was made as to how crucial the star's role was to the film. Stiller's case was helped because he was key to the lunacy of that film. Stiller was also helped because he was the central figure in Dodgeball, a film with a $20 million budget that sold more than $114 million worth of tickets in the U.S.
PIRATE'S BOOTY. The rankings get changed a bit if calculations are made for films since 2000. That would have given Tom Hanks the crown with a staggering 105% return on investment, meaning he doubled the money his studios spent to make his films. He was helped no doubt by the huge success for the 2000 film Castaway, which was made for $90 million but brought in more than $427 million worldwide at the box office alone. And he was one of the two stars in the Spielberg-helmed film Catch Me if You Can, which was made for $52 million and grossed more than $351 million worldwide. Of course, that film also starred Leonardo DiCaprio, no doubt a boost at the box office. Next up would be Johnny Depp, whose films over that period included the 2003 film Pirates of the Caribbean: The Curse of the Black Pearl, which sold more than $652 million worth of tickets worldwide on a $140 million budget.
Of course, by the end of the year, Depp will likely be in an ROI league closer to Hanks and Cruise, and maybe even Tyler Perry. Depp's 32% six-year ROI is already adding points by the hour, it seems, as his latest swashbuckling film, Pirates of the Carribbean: Dead Man's Chest, packs them in. As of July 9, BoxOffice Mojo.com estimates that the film was approaching $140 million at the US box office and $200 million worldwide, despite only opening in a few countries outside the U.S. Disney executives privately figure it could pass $300 million in the U.S., and may well exceed the pirate's ransom collected by the first film. Okay, so the second film cost more than $200 million to produce (compared to about $140 for the first Pirates flick). Still, throw about a zillion DVDs into the mix, and the folks who dragooned Jack Sparrow will be staggering all the way to the bank.