A Rocky Road For Pixar

From a socionomic perspective, the rapid decline of Cars 2 is evidence of social mood turning bearish. We have seen sign after sign that we are in a transitional period where family movies are falling out of favor and horror movies are finding unexpected success in theaters.

The correlation between social mood and the success of Disney movies was first discussed in the title The Wave Principle of Human Social Behavior, and there is a write-up on the subject at the Socionomics Institute site as well.

Although many are quick to attribute the rapid decline of Cars 2 to Transformers 3, consider the following:

In 2004, Harry Potter and the Prisoner of Azkaban did not derail Shrek 2.
In 2007, Transformers did not derail Ratatouille.
In 2008, Both Kung Fu Panda and WALL-E continued to do a respectable amount of business after The Dark Knight opened in theaters.
In 2009. Transformers 2 did not derail Up, and Ice Age:Dawn of the Dinosaurs over-performed with good staying power in theaters in spite of coming out in theaters just after Transformers 2 did.

All of the cases listed above reflect the correlation between positive social mood and the success of Disney, Pixar, and Dreamworks, which unfolded regardless of what else was playing in theaters at the time.

In late May 2011, just after the recent top in the DJIA, Kung Fu Panda 2 opened in theaters with disappointing results, with the opening weekend 45% lower than the original in terms of attendance and on track to sell only half as many tickets as the original -- all this in spite of the original having been well received by the movie audience.

Although the outcome of Cars 2 took many people by complete surprise, it was predictable from a socionomic perspective. I had predicted a month before the movie opened that it would have a disappointing performance in theaters. The first sign was the 35% Rotten Tomatoes rating, which was considered unthinkable for a Pixar movie, considering that all Pixar movies through last year scored 95% or better. The second sign was from the opening weekend, which was 25% lower than the original in terms of attendance. The real shocker, though, would be the second weekend drop -- 65% -- an unprecedented collapse for a Pixar movie. Pixar movies are known for their staying power in theaters, but Cars 2 is rapidly losing momentum.

We are in a transitional period. We are already seeing early indications of horror movies finding increased success in theaters, which is characteristic of bear markets of Cycle or larger degree. Earlier this year, the horror movie Insidious performed better than expectations and exhibited surprising staying power in theaters.

With social mood continuing to trend downwards over the next 10 years, we can expect next year's Pixar movie Brave to not just disappoint, but outright bomb.