By Mark Seavy   

Horror is rewriting the script for licensing amid the surprise success of recent box office hits like Obsession and Backrooms.  

The two films, which had their genesis on YouTube rather than Hollywood backlots, have generated a combined $548.8 million in global box office revenue since their release in May—on combined production budgets of less than $11 million.  

In addition to their surprise domination at the box office, these horror films have also put a twist on the typical plot where sudden success of a new movie or series is accompanied by a lack of products that send suppliers scrambling to gear up manufacturing (think KPop Demon Hunters, Stranger Things, Squid Game, or the 2013 release of Frozen). Instead, the growing popularity of this year’s scariest movies has shined a light on the horror genre’s expansion beyond the typical t-shirts, caps, and collectibles for licensing. 

The production company behind Backrooms, A24 Entertainment, has had related merchandise available online almost from the film’s release on May 29. This included internally-developed 30-inch wide yellow wallpaper panels ($60) that play a prominent role in the film. Additionally, eCommerce retailers like Shein and Redbubble have carried yellow wallpaper-themed blankets inspired by the film as well as the original viral YouTube series from the film’s director Kane Parsons.  

The film Obsession, which was produced by Comcast Corp.’s Focus Features, meanwhile, had a more predictable product path through its affiliated NBCUniversal store, but did add home goods like a “Smells Like You” candle and a tote bag.  

“Fan communities who feel attached to the properties they have grown up watching and investing their time into on YouTube or via videogames are showing up in a ‘for us, by us way’ at the box office,” said Russell Binder, Founding Partner at the agency Striker Entertainment, which represents Five Nights at Freddy’s and Jason Universe for licensing and struck a TV development deal with Blumhouse TV in 2018. “Horror IPs, depending on the project and the iconic nature of the featured elements, are still strong in collectibles, apparel, and accessories. But we are seeing growth in trading cards, location-based experiences, food and beverage, seasonal, and digital gaming.”  

That growth is being fueled by an enthusiastic fan base that has turned horror merchandise, once largely relegated to Halloween, into a year-round business. Higher end boutique brands and trendy lifestyle shops have forged partnerships with studios to release limited edition drops, art collectibles, and housewares, rather than basic costumes.  

Horror film producer The Horror Section, for example, released its first movie, Jimmy & Stiggs, last August. But it had already landed a licensing deal with lifestyle apparel brand Blackcraft Cult to produce custom, limited-edition merchandise. The production studio, which has financial backing from Media Capital Technologies for films, TV, gaming, and live events, is also releasing The Ice Cream Man on August 7 and has a collaboration with rapper/entertainer Snoop Dogg for Don’t Go in That House, Bitch!   

“When these movies make the leap from YouTube to theatrical films, I wouldn’t be surprised if there isn’t apparel already in place for these types of films and, if there is a costume application, someone like [retailer] Spirit Halloween would chase that right away,” said a licensing executive at a costume supplier in noting that Spirit reacted quickly last fall to the surge in popularity for KPop Deamon Hunters. “Horror has grown significantly and is very mainstream now and it will absolutely make it into décor.”  

Whether this new wave of highly successful independent horror films will prompt studios to move away the more predictable sequels business (Scream 7 was released earlier this year) remains to be seen. But Obsession writer and director Curry Barker, who has already shot a second film, Anything but Ghosts, and has signed on for A24’s reboot of Texas Chainsaw Massacre, is banking on it. 

“Most of our fame started on TikTok, then we started putting [videos] on Instagram, and then we started putting them on YouTube,” Barker told Hollywood Reporter. “It’s just a buzzy thing to say ‘this is a YouTube thing.’ They [A24] didn’t feel like they needed to babysit the process. So, let a filmmaker take the reins and have creative freedom and not try to stick your claws into it is a lesson Hollywood should learn.”