Read the actual Jeffrey Katzenberg memo that inspired the Jerry Maguire memo

I’m sure I don’t have to tell you because you already know the movie by heart because it’s your favorite, but one of the crucial plot points in Jerry Maguire is Jerry’s decision to write and disseminate a heartfelt memo about getting back to the company’s roots and focusing on personal relationships. The memo wins him a slow-clap from his agency’s staff, but eventually leads to him getting fired, just like that asshole Jay Mohr predicted. What many people might NOT know is that that fictional memo in Cameron Crowe’s movie was inspired by a real memo Jeffrey Katzenberg (then head of Disney, current CEO of Dreamworks) sent around to his fellow Disney executives in 1991.

LettersofNote have gotten their hands on the original memo, and above all else, it’s super long. 28 freakin’ pages worth. Based on every exec speech or communique I’ve ever heard, it seems like the key to success in business is being able to stretch a two-word thought into ten and repeat it at least six times. Nonetheless, it’s interesting, and I’ve tried to excerpt some of the more poignant/relevant/ironic parts.

Back in 1984, our initial success at Disney was based on the ability to tell good stories well. Big stars, special effects and name directors were of little importance. Of course, we started this way out of necessity. We had small budgets and not much respect. So we substituted dollars with creativity and big stars with talent we believed in. Success ensued.

With success came bigger budgets and bigger names. We found ourselves attracting the calibre of talent with which “event” movies could be made. And, more and more, we began making them. The result: costs have escalated, profitability has slipped and our level of risk has compounded. The time has come to get back to our roots.

It used to be that there was a reliable criterion for a film’s success — whether or not it had “legs.” Studios would toy with different strategies for opening a film, all with the goal of helping it develop “legs” through positive word of mouth. Now the term “legs” has all but disappeared from the Hollywood vocabulary. Thanks to the dictates of the blockbuster mentality, the shelf life of many movies has come to be somewhat shorter than a supermarket tomato.

Sadly, relying on big opening weekends has only gotten worse since then. Though to Katzenberg’s credit, Dreamworks’ Puss in Boots only dropped 3% from its opening weekend this weekend, one of the smallest second-weekend drops anyone can remember. Yet somehow I doubt that’s a result of seeking out creativity at the expense of special effects…

On ticket prices:

I know that my negative outlook for our industry will be challenged by many Wall Street analysts. These pundits will argue that the film industry is recession resistant or even recession proof because, when there is fear and uncertainty in the real world, people seek escape and entertainment in their local movie theaters.

Right argument, wrong conclusion.

When there is fear and uncertainty, the people have craved bargain entertainment. During previous downturns, the best escapist entertainment value was at the movie theaters. But no longer.

The notion of the film industry being recession proof began during The Great Depression. People wanted to escape and the movies offered it cheap — 10 cents a ticket, or the cost of a loaf of bread. Today, a ticket to the movies costs the equivalent of six or seven loaves of bread. What’s more, a family of four requires $20-$30 to get in to see a movie. Add popcorn, parking, etc. and the total reaches $35-$40 or even more.

On the other hand, that same family can go to the local video store and rent a videotape for a mere $2.00… 50 cents each — less than the cost of a loaf of bread.

So, when times get tough I have no doubt that people will still want to escape to the movies, but they’ll want it for the historic cost of a loaf of bread.

I’m total agreement with him here, but of course, Jeffrey Katzenberg is also the same guy who was instrumental in ushering in premium-priced 3D. (Speaking at the same symposium, another proponent of 3D said “Premium pricing is the heart of a new incremental revenue stream for movie theaters.”)

The extraordinary popularity of such films as “Pretty Woman,” “Ghost” and “Home Alone” teaches the real lesson of 1990: Despite all the hype and promotional noise, in the end the public will search out the movies it wants to see. And these films, more often than not, will be primarily based on two basic elements — a good story, well executed. Not stars, not special effects, not casts of thousands, not mega-budgets, not hype.

In the dizzying world of moviemaking, we must not be distracted from one fundamental concept: the idea is king. Stars, directors, writers, hardware, special effects, new sound systems… all of these can have a role to play in the success of a film, but they must all serve as humble subjects to the supremacy of the idea.

There’s plenty of hypocrisy to point out between the Jeffrey Katzenberg of 1991 and the Jeffrey Katzenberg of 2011, of course, but to me the best part of it is always hearing industry people make these poignant, heartfelt, profound statements that become gorgeously absurd as soon as they’re juxtaposed with the actual product they’re selling. “Idea is king. Creativity above all else. You see, there’s Macauley Culkin, and he’s in a house by himself. Burglars come, but he makes them hit their heads and fall down. When you’ve got a winner like that, everything else is just window dressing.”

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