Chapter 59: Hidden Markets

The filming proceeded smoothly in the remaining days. Cheng Long invited Xiao Ran to the premiere of his film *Brothers, Dragons and Tigers*, while at the same time, *Eight Stars Bring Good News* passed the midnight preview test and was officially released. These two strong New Year’s movies would compete fiercely in the prime time slots…
On the premiere day, *Brothers, Dragons and Tigers* led *Eight Stars Bring Good News* by a significant margin, but by the second week, *Eight Stars Bring Good News* quickly caught up. The former’s final box office earnings were around 35 million, while *Eight Stars Bring Good News*, thanks to its strong momentum, overtook Cheng Long’s film by nearly a million, breaking Hong Kong’s box office record.
*Xiao Ran*, who wrote the script and directed *Eight Stars Bring Good News* himself, became an instant success. Even *Ming Pao Weekly* sent Leung Ka-bau to conduct another in-depth interview. It was this film that made Xiao Ran famous overnight, leaving Huang Bai-ming extremely regretful—he now wished he could immediately bring Xiao Ran back to New Art City.
In the interview with *Ming Pao Weekly*, Xiao Ran emphasized the importance of scripts in a very prominent manner, claiming that only good scripts could produce films that audiences would like. Suddenly, talented screenwriters became highly sought after, and those with reputations saw a significant rise in their value. The gratitude of screenwriters in the industry toward Xiao Ran was beyond description.
This success not only established Xiao Ran as Hong Kong’s top screenwriter—but it was only “established” because this title hadn’t yet been universally recognized by the industry. However, he was generally considered among the top directors, a point on which everyone agreed. Still, one successful film might be luck, but two or three would be something different.
After the New Year, when work resumed, Xiao Ran began preparing for his achievements. But before that, he needed to plan for the year ahead.
In 1987, Hong Kong cinema entered an era of both distortion and peak performance. Starting from this year, repeatedly broken box office records made everyone greedy; anyone with money started thinking about making films.
Too many things happened that year, and Xiao Ran was too lazy to even think about them. He wasn’t someone who focused much on planning; if he could lie down, he would never sit up. So, he would never make any unrealistic plans for things that might not happen in history.
March in Hong Kong was still a pretty good month, at least the weather wasn’t too hot. But Xiao Ran and Wei Dongling felt somewhat restless. *The God of Gamblers* was about to finish filming, while *Prison Storm* and *A Fairy Tale in Autumn* were in the planning stage.
What annoyed Xiao Ran wasn’t this, but money. Of course, it wasn’t due to a lack of funds—although the company, still in its developmental stage, indeed needed money more than anyone else—but that wasn’t what troubled him at the moment.
He was annoyed about the film budget. When Yu Jia-yu presented the budget report for *The God of Gamblers*, he overlooked an extremely important expense. It couldn’t really be called oversight; it was more of underestimating it. And Xiao Ran had also missed this crucial item—marketing costs!

The 21st century has treated promotion as an equally important aspect as production, but this era has not yet reached that level—at least Hong Kong films do not have the habit of investing heavily in promotion. According to Zhou Liming’s book *Hollywood Revelation*, which analyzes Hollywood, Xiao Ran clearly remembers that in the 21st century, Hollywood allocated half of its total investment to promotion. This means that if a Hollywood film has a total investment of 100 million dollars, 50 million of that goes into promotion, highlighting its importance. Unfortunately, whether it’s the budget provided by Yu Jiayu or Chen Kexin or Mo Tianxin, the amount allocated to promotion is so minimal that it could easily be forgotten by anyone. If this book is meant to attract attention, it certainly isn’t reliable. But Xiao Ran is well aware that given Zhou Liming’s understanding of Hollywood, this information is definitely not exaggerated. Thus, he can’t ignore the importance of promotion. Moreover, Zhang Yimou’s *Ambush* did an excellent job in promotion, resulting in huge box office earnings—a perfect example of successful marketing. Of course, Xiao Ran has considered that Hollywood’s influence spans the entire world, while current Hong Kong films are limited to Southeast Asia, so the proportion of investment in promotion naturally won’t be high. Promotion costs in other regions also don’t fall on Meiying but rather on the film producers, which doesn’t worry Xiao Ran. Another reason he’s annoyed is that he asked the distribution department to prepare a market report on promotion, which should at least include a comprehensive budget and plan. However, the report submitted by the head of the distribution department infuriated Xiao Ran, while the report from another team arranged by Wei Dongling showed some insight. The first report argued that there was no need to invest heavily in promotion, even suggesting that promotion wasn’t the company’s responsibility but rather that of the cinema chains. The second report, which Xiao Ran appreciated more, was based on a small-scale survey. After synthesizing the results, it concluded that promotional efforts were necessary, but investing heavily in promotion at the moment wasn’t a wise decision. Xiao Ran liked this report because one of its reasons was that the survey team believed that, given current entertainment trends, movies are an essential form of entertainment. People are accustomed to going to cinemas for leisure, so modest promotional efforts would be sufficient. Otherwise, even heavy investment in promotion wouldn’t significantly increase the film’s potential audience. Xiao Ran agreed with this—today’s entertainment options are very limited, not as diverse as in the 21st century with the internet. In that information-rich era, although information was abundant, people still struggled to make the right choices among so much data. Thus, extensive promotion became a necessary means to attract audiences.

At least Xiao Ran knew that as a child, aside from watching TV, he only played with mud with his peers, and Hong Kong was no exception. Glancing at Wei Dongling, who was dealing with documents, he cleared his throat and waved the report. “A Dong, remove the current head of the distribution department and have this person take over!”
Wei Dongling raised his head irritably, stared at Xiao Ran for a long time, and then said gloomily, “Next time I’m working, can you stop interrupting my train of thought? That’s not right. The current head of the distribution department is an experienced insider. Replacing him with that young person will likely cause chaos in the department!”
“It doesn’t matter!” Xiao Ran rubbed his nose and smiled eerily. “It doesn’t matter whether it’s an insider or an outsider. What’s most important for the distribution department is having marketing skills. He doesn’t need to know much about movies, and…”
And it’s better if he’s younger, as he’ll be more open to future changes! Xiao Ran added this thought to himself. After thinking for a moment, he disturbed Wei Dongling again as the latter nodded in agreement and prepared to focus on his work. “There’s one more thing—find someone with organizational skills to set up something similar to New Art City’s ‘Friends of the Phantom.’ As for the target audience, focus on the lower-tier groups; they can play a significant role in promotion!”
“And have the newly appointed head of the distribution department calculate the proportion of promotional expenses as soon as possible!” After thinking further, Xiao Ran quickly came up with another idea, leaving Wei Dongling’s logically minded brain struggling to keep up. “I think I need to talk to the person in charge of Golden Princess Cinema about this!”
Xiao Ran wasn’t sure if he could convince Golden Princess to share the costs! However, he believed that since the cinema chain could split profits with production companies, it surely had an obligation to cover some of the promotional expenses. But exactly how much that should be was hard to calculate!
The person in charge of Golden Princess Cinema was Liao Jingping. Xiao Ran had never met him before, but he greatly admired his business acumen. Among Hong Kong’s five major cinema chains, Deppa was leased from Shaw Brothers, so it didn’t need to be mentioned. Even the other three major chains kept losing to Golden Princess. Aside from New Art City and film studios producing high-quality works, the business strategies behind Golden Princess were indeed remarkable.
Liao Jingping had been in charge of Golden Princess Cinema since Lei Kaitai started investing in films. In just a few years, he quickly acquired many cinemas. Not only did he surpass Jiahe in terms of the number of cinemas, but he also managed them effectively, earning Lei Kaitai huge profits every year. These cinemas had the potential to become commercial chains in terms of location and other aspects, which truly impressed people like Xiao Ran.
Liao Jingping was a middle-aged man who welcomed Xiao Ran warmly. After taking a sip of water, Xiao Ran comfortably leaned back in his chair and explained his purpose. Liao Jingping frowned deeply and expressed his opposition. “Boss Xiao, I think there’s no need to increase promotional expenses because the current amount is already sufficient! Besides, more promotional expenses mean higher costs! But we can’t be sure how many more potential viewers we’ll gain—this isn’t a good deal!”

Sure enough, there was a solution—cost issues were quickly addressed! Xiao Ran smiled slightly. He hadn’t expected to attract many potential viewers just by increasing advertising expenses. After all, as times progressed and people had more choices, some would naturally drift away. But when this loss reached a certain level, it would inevitably give rise to another type of audience. Take television, for example—“Jurassic Park” was sold to TV stations, with each broadcast costing over ten million dollars. This was because cinema audiences shifted to television, creating an indirect audience for the film. He simply wanted to take this opportunity to build an efficient and precise advertising team to foster growth in the future. When the right time came, he could rely on this experienced team as a asset to lead Hong Kong’s film industry. However, Xiao Ran didn’t mention this, nor did he point out that some posters could attract audiences more effectively than others. He merely tapped the table gently; combined with his youthful appearance, this gesture carried a sense of authority: “There’s no such thing as a bad deal. If two films of equal quality are released at the same time, one with promotion and the other without, I think the outcome is predictable!” Liao Jingping thought for a moment before agreeing with Xiao Ran, but he still had serious doubts about increasing advertising costs. “Won’t this draw audiences away from another film? I don’t see any benefits to this, Boss Xiao. I advise you not to do it. Otherwise, you might make enemies with other companies!” “People’s entertainment options are quite limited!” Xiao Ran rubbed his nose, trying to make his point more convincing. “With such promotion, they’ll be more likely to watch both films instead of just one!” “Besides, a family comedy and a gangster movie target different audiences! Why can’t we attract viewers who wouldn’t normally watch these genres?” Xiao Ran asked. The true goal of effective promotion is to convince people who wouldn’t otherwise buy something to do so, rather than competing for market share from other companies. “Well…” Liao Jingping hesitated. He had to admit that Xiao Ran’s reasoning made sense—he was almost convinced. But he still hesitated before finally responding, “Boss Xiao, I need a few days to think it over. You know this isn’t a trivial matter!” Of course it wasn’t trivial. If Meiyin increased its advertising expenses, other film companies would eventually realize the benefits and follow suit. This was exactly what Xiao Ran wanted—whether indirectly or directly, it would bring about subtle changes to Hong Kong’s film industry. A few days later, Liao Jingping agreed to the plan and discussed with Meiyin the proportion of advertising costs each would bear. Of course, for now, these advertising expenses were still minimal, but it was still a step forward.

Chen Kexin and Mo Tianxin came up with new budgets, while Xiao Ran personally served as the producer for both films. As the art director, he discussed the film style with Lin Lingdong and Zhang Wanding. He did not intend to get involved in the specific directing aspects, as both of them were talented directors with their own ideas, and his interference could easily disrupt their thinking.