08.16.10

Inside the Eat Pray Love Merchandising Machine

The Julia Roberts movie has fueled a $350 million industry based on chick lit. But inside the numbers, the book looks less like a business juggernaut—and more like an innovative Hollywood marketing campaign.

For the past week, the country has been blanketed by a commercial assault more appropriate for a space robot or Disney princess movie tie-in than a flick detailing a thirtysomething divorcée's journey of discovery. From embossed pasta bowls to frilly wall hangings, Eat Pray Love, The Daily Beast calculates, has turned into a $350 million franchise, and that doesn't include all the Italian restaurant feasts and Bali tours that hundreds of other businesses have ginned up.

How did we come up with that number? Elizabeth's Gilbert's book, naturally, gave it a running start. Her tale of "one woman's search for everything across Italy, India, and Indonesia," a beacon for the commercial viability of chick-lit, has sold 9 million copies worldwide, generating an estimated $135 million in sales. And growing: The film's release catapulted the movie tie-in version of the paperback back onto the top of bestseller lists.

From lip gloss to a $20,000 tour of India, click here for our gallery of Eat Pray Love Inc.

Meanwhile, for all the snickering about how a classic testosterone movie, The Expendables, beat out Julia Roberts et al. at the box office this weekend, a Sony source says that the movie will wind up generating close to $175 million in ticket sales this year worldwide, according to internal projections.

Perhaps most interesting, however, are the dozens of licensed products and knockoffs that are fairly unprecedented for a movie where the core audience is around 40. Sony cut a deal with HSN, and the shopping network devoted three full days of programming during the first weekend of August to Eat Pray Love-themed merchandise, some of which remains available on HSN.com.

The network would not comment on the viewership over that period, but said that it was "very pleased with the performance" and more than 100 products sold out during the event. Some featured products, like beaded bracelets and pillow shams, evoke the Italy-India-Bali theme of the story. (Gilbert structured her book into 108 "tales" in deference to the number of beads on a prayer bead necklace; HSN included a $350 prayer bead necklace.) Other products, such as Perlier's body cream and shower gel, were licensed, under the EPL banner.

"We were the ones to say 'no', to several products," says Bill Brand, executive vice president of programming, marketing and business development for HSN. "There has been a lot of demand for this type of partnership."

Sony proactively reached out to several smaller brands to see if they wanted to create EPL-inspired products. Dogeared designed a line of jewelry, Fresh launched a line of perfumes, Republic of Tea created a limited-edition black tea and designer Sue Wong even created an EPL collection. While brick-and-mortar, big-box stores like Walmart or Target would be reticent to carry licensed products for a non-franchise film that appeals to a limited spectrum of consumers, smaller retailers who share the target consumer are more apt to want to take advantage of an EPL affiliation.

"It's great brand awareness for us," says Marcia Maizel-Clarke, founder of Dogeared jewelry. "It will create additional sales."

The total expected sales of all this merchandise: around $36 million, according to Pete Canalichio, vice president of business development for Licensing Brands Inc. And what cut do Sony and Gilbert get? Very little, actually. Yes, they take a 10 to 15 percent licensing fee, but only for products that actually use the Eat Pray Love name or logo—about $10 million of the $36 million figure. For the trinkets and tours inspired by the franchise, Sony and Gilbert get shut out. And that $10 million figure shrinks, because the licensing fee is based on wholesale price. In all, Sony/Gilbert will pocket a measly $500,000 or so from this vast merchandise orgy.

So why bother? Because, boiled down, Sony and Gilbert made a profit while marketing their movie and book, respectively, defraying millions that would have otherwise gone into television advertising.

"When you have consumer products for a film, it typically always helps the film… it's great advertising and a great revenue-driver," says Steven Ekstract, group publisher of License! Global Magazine. "We live in a time of everyone embracing pop culture and they want the product."

Eat Pray Love had a ton going against it. It was a "one-quadrant" film, appealing only to adult women. It debuted in August, the slowest month in publishing and television, making advertising in print or prime-time less effective. Plus, Julia Roberts' ability to draw viewers has remained unproven for years (though her $10 million upfront payday for EPL is a relative bargain compared to the $20 million she reportedly made for Mona Lisa Smile and Erin Brockovich).

So the merchandise blitz filled the void. "Right now, studios need to do something that can help break through the clutter [of advertising]," says Gordon Paddison, founder of the strategic marketing firm Stradella Road and a former marketing executive for New Line Cinema. "It's not like this is rocket science, but it is good marketing."

According to the Sony source familiar with the film's finances, the film will be profitable for the studio, surpassing the $65 million breakeven point that includes the amount Sony spent to make and market the film. The studio projects a gross of between $75 million-80 million at domestic box offices, plus an additional $100 million overseas.

And Gilbert's take? The writer has easily made $10 million in royalties from the book, and according to one source with knowledge of the deal, she earned another $1 million for the film rights. (She reportedly used the proceeds from selling the film rights to renovate the 8,000-square-foot store where she sells imported goods with her husband. "This should be called the Julia Roberts Memorial Building," she quipped.)

Gilbert went off to Italy to find herself—and in the end, she found herself very wealthy. Sony and HSN won't fare too poorly either.

Lauren Streib is a reporter for The Daily Beast. She was previously a reporter for Forbes.