‘NIGHTMARE’: AN INDUSTRY DREAM

The folks at New Line Cinema knew that Freddy Krueger was on his way to official cult status when the display art started to disappear from video stores and theater lobbies. The cardboard cutouts and gory one-sheets featuring the latex-smothered anti-hero of “Nightmare on Elm Street” fame were pilfered or, in some cases, sold to teen-age Freddy worshipers.

“Even though he’s rather hostile to them in the movies, teen-agers love Freddy,” said Bruce Blackwell, New Line’s director of marketing.

While a murdering psychopath who attacks children in their dreams may seem a long shot for hero status, consider the numbers on these films. The first two installments of “Nightmare” performed surprisingly well at the box office, making Freddy the sleeper slasher of the ‘80s. While the first two films cost a total of $4 million to make, together they have grossed more than $70 million in ticket, videocassette and cable sales. While Jason, the well-known protagonist of the “Friday the 13th” series, seems to be waning in popularity, Freddy appears to be gaining strength. “We don’t think the character has even peaked yet,” said Blackwell.

The first indication will come this weekend when Freddy, resurrected yet again in “A Nightmare on Elm Street III: Dream Warriors,” squares off against the newest collection of clean-scrubbed hipsters in John Hughes’ latest coming-of-age film, “Some Kind of Wonderful.” “Nightmare III,” which opens at 1,300 theaters, stars Robert Englund as the deranged Freddy; “Wonderful,” opening at 1,075 theaters, features a cast of fresh-faced up-and-comers along with the cutting-edge kind of sound track that is part of the winning Hughes formula.

Odds are that while “Wonderful” probably will wind up doing more business overall, the bad guy will clobber the good guys at the box office the first weekend. “I don’t know whether we’ll beat ‘Platoon’ but we expect to beat ‘Some Kind of Wonderful’,” said Mitch Goldman, president and chief executive officer of New Line Distribution Inc. “No John Hughes movie has ever opened to $9 million the first weekend, and we expect to do at least that much.”

This is New Line’s first national release and the company is hyping Freddy heavily. The first two “Nightmares” were released on a regional basis, opening in several cities one month and moving to other cities the next, to save money on the cost of prints and publicity. More than 15 million people have seen Parts I or II of “Nightmare.” Marketing executives anticipate that Part III may draw the most blood at the box office. New Line Cinema is spending more than $5 million hyping Freddy and the film.

As a result, Freddy is cropping up everywhere. If you’ve been to the movies lately, maybe you saw the teaser at one of 5,000 theaters. Or maybe you caught Freddy guest-veejaying on MTV. Or maybe you bought the new heavy-metal Dokken album featuring a song from the movie.

In the coming months, there will be Freddy T-shirts and Freddy bubble gum, Freddy door posters (the last edition sold 80,000 copies), wall hangings and pillowcases. There’s even a Freddy fan club. Said Michael Harpster, senior vice president of marketing at New Line: “After the success of the second one, it was clear to us we had a hero on our hands and we made a conscious effort to start selling him.”

Even though “Nightmare II” was panned by critics, the sequel sold an astonishing 188,000 units in videocassettes, 77,000 more than the original, which was well received by critics and fans alike. (A Washington Post critic called the first installment “extraordinarily polished.”)

How do you explain this morbid fascination? Clearly, to the youngsters who support him, Freddy is more than just another exploitation murderer. “Freddy doesn’t just swing an ax, he does it cleverly,” said Goldman. “It’s the imagination: Everyone is afraid of their dreams at some point.”

Freud might have had a field day analyzing Freddy’s appeal. Research commissioned by New Line showed that Freddy’s core audience--14- to 24-year-olds--breaks into two categories. First are the traditional horror freaks, who simply enjoy the adrenalin buzz of pure fear. But Freddy also has a loyal punkish following that has embraced him as an anti-Establishment, anti-authority hero. “There is a punk sensibility to what he (Freddy) does,” said Robert Englund, the 39-year-old Los Angeles native who portrays him. “Elm Street is symbolic of traditional America and the kids like the fact that Freddy is out there kicking butt on the middle class.”

Horror movies have historically been a sturdy genre in Hollywood and studios love to make them--for a variety of reasons. In general they are far less expensive than the average motion picture and they can yield an enormous profit if the picture clicks. “They are inexpensive, relatively easy to sell and target a very specific audience,” said Goldman. “That’s a pretty unbeatable combination for a studio to bring down its average for a year of budgets.”

To attract new fans and loyal Freddy supporters to this third chapter, most of the money has gone for a blizzard of TV spots running in 220 “areas of dominant influence.”

The strategy is an attempt to bring in as many viewers as possible in the first few weekends, because that’s when the studio lands the largest share of the box-office gate; in a typical contract with a distributor, the theater owner gets more of the box office as the weeks progress. “One of the things we hope to accomplish is to deliver a big first-week gross,” said Harpster. “You try to front-load the business.”

Hype aside, the ultimate test for “Nightmare III” will be whether the movie plays well to its initial paying audiences Friday night, which undoubtedly will consist mainly of fans who have seen the first two films. If they like the movie and a strong word-of-mouth circulates, then Freddy’s life may lengthen by yet another bloody sequel. “I think we’ll make them for as long as people want to come see them,” said Goldman. “Inevitably they will run out of gas. When people stop coming, they won’t be made anymore.”

In the case of Freddy Krueger, kids may have to stop having nightmares first.