AFI Dips a Toe Into Marketing Waters

Until now, most people have had their brush with the American Film Institute exactly once each year.

That’s when the Hollywood-based nonprofit group bestows its Life Achievement Award. The ceremonies are broadcast on network television and honor such luminaries as Elizabeth Taylor, Steven Spielberg and, this year, Clint Eastwood.

But Americans are about to see a lot more of AFI, at least if its leaders have their way. Faced with sharply declining federal funding for the arts, the 29-year-old organization has responded with a marketing push that involves everything from licensed merchandise like T-shirts and CD-ROMs to a new 7,000-square-foot attraction that opens next month at Disney-MGM Studios in Florida.

It’s all part of an ambitious bid to turn AFI into a nationally recognized cultural treasure, or a “Smithsonian of the moving image,” in the words of director Jean Picker Firstenberg.

“When I came to AFI 15 years ago, I had the naive belief that if you did good work, had a quality product, that would speak for itself,” Firstenberg said in a recent interview. But in recent years “we realized that the world was changing so much around us that if we didn’t . . . really force ourselves to think in different ways” AFI could not continue its training, preservation and exhibition activities.

Ironically, Sen. Jesse Helms and other critics of the National Endowment for the Arts are indirectly responsible for the shift. The NEA has for years provided about $2 million, or 17%, of AFI’s $12-million annual budget, according to Firstenberg.

But attacks from conservative critics have left the NEA fighting for its life and small arts organizations scurrying for other sources of support. Last year the grant-making federal agency trimmed its staff by almost 50%, underwent a major restructuring and braced for steep congressional funding cuts.

AFI is far from the only arts group to mix marketing with a high-minded mission--in this case, to advance and preserve “the art of film, television and other forms of the moving image.” In recent years, museums and public-radio stations have opened retail stores to raise revenue and public awareness.

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Some critics argue that such strategies undermine the traditional role of nonprofit institutions.

In the book “Marketing Madness: A Survival Guide for a Consumer Society,” authors Michael F. Jacobson and Laurie Ann Mazur criticize “partnerships” between nonprofits and corporations.

“While some may portray such partnerships as ‘win-win’ situations, the integrity of the professional group may be eroded and the public interest may get lost in the shuffle,” the authors wrote.

Even some within AFI concede that Darwinian economics could spell extinction for smaller, less savvy arts groups. Vivian Sobchack, an associate dean at UCLA and AFI board member, noted that colleges and nonprofit organizations have a much harder time now than during the 1960s, when federal money flowed more freely.

“The idealism [behind nonprofit support] is gone,” Sobchack said.

AFI has its roots in Great Society idealism. The NEA--created by the Johnson administration in 1965--bankrolled a Stanford Research Institute report that led to the creation of AFI two years later. Initial funds were provided by the NEA, the Motion Picture Assn. of America and the Ford Foundation.

Over the years, AFI has become a leading educator of film industry professionals. Its nine-acre Hollywood campus, formerly the site of the Immaculate Heart College, offers a two-year graduate program in various aspects of filmmaking, courses in advanced technology and workshops for directors and television writers.

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The institute also spends more than $1.5 million annually on film preservation, maintains a database of movie and video holdings at libraries nationwide, and is compiling an exhaustive catalog of every U.S. feature ever made.

Unfortunately, little of this work generates enough income to support itself. A 1994 balance sheet--the most recent available--shows that AFI spent almost $4 million on education and training, for instance, yet generated just $2.9 million in tuition and fees. (AFI has ended every year in the black since 1991, when it reported a $130,000 deficit.)

“Our goal has been to have our programs, wherever they could, cover their costs with admissions, tuition and fees,” explained deputy director James Hindman. But “some things will never support themselves, such as preservation and training. . . . There has to be another revenue stream or endowment.”

Enter the AFI board of trustees, which includes some of the most powerful figures in the entertainment industry, including Spielberg, ICM chairman Jeff Berg and MPAA chief Jack Valenti. Firstenberg said board members strongly encouraged her and Hindman to leverage AFI’s prominent position in the film community into a nationwide marketing plan.

The new AFI Showcase at Disney-MGM Studios is one result. Designed by Walt Disney Imagineering, the facility will include an interactive display on film preservation, exhibits on Jack Nicholson, Orson Welles and other Life Achievement winners--and a counter where visitors can purchase AFI-branded souvenirs and videotapes.

The group last year hired Lee Tomlinson, a former marketing expert for the 1992 U.S. Olympic Festival, to develop and market new AFI products. “My job is to figure out how to package AFI and make it attractive to consumers and organizations,” he said. “Content is king, and AFI is all content: movies and TV.” Among the plans: more videocassettes, books and CD-ROMs.

AFI officials say that such moves hardly undermine the organization’s focus on education and preservation. In fact, they argue, the state of government funding has left them with little choice.

“The handwriting has been on the wall for years that we had to become as self-supporting as we could,” Hindman said. “We had to find ways to pay our way--and we had at the same time to protect our mission.”