How do film and video production companies determine their prices?
This is one of the most common questions we get from customers and people in the production community, especially as the price of video equipment and editing software drops.
So why does video cost what it does, and why can prices vary so much between providers?
The closest analogy to a video production I can think of is a kitchen remodel. (This will make sense. I promise.) In both cases, there is a general contractor (producer) who oversees a variety of specialists (writers, directors, cinematographers, editors, composers) to complete the job. Both the contractor and the producer present a creative solution, a budget and manage the time and schedules of the specialists.
Just like with a kitchen remodel, the decisions you make when planning a video determine the price. Here are some things to consider.
Experience – How experienced are your producers and crew (contractor and subs)? Is this your first project or have you been doing this type of work for years? An experienced production team can be of great help in the creative development of the show. Such proficiency allows a contractor or producer to effectively anticipate and solve problems, saving time and money.
Director – Like a great chef, a director knows what to do to achieve the best results. A good manager costs more than an inexperienced manager, but it can be the difference between Chateau Briand and dog food. Additionally, an experienced director can be instrumental in planning a realistic number of shooting days to bring the creative vision of the project to life.
Equipment: The quality of the actual recorded images varies as much as the models of refrigerators, stoves and dishwashers. Today, cameras are ubiquitous and inexpensive. But the true cost of production-quality cameras remains high due in large part to cutting-edge technology and professional-grade lenses.
· Artistry – What should your video look like? The answers are as varied as the many options facing a construction project. In a kitchen, does food taste better cooked on a Viking stove instead of a KitchenAid?®? Will the cabinets be handcrafted by a skilled carpenter or purchased from a superstore? Will they be cherry or oak? The answers are determined by brand identity and corporate culture, which can be key drivers of creative direction.
Audience: In general, the larger the potential audience, the larger the budget. Commercial kitchens and television commercials serve a broader demographic. A program for internal use generally costs less than a marketing vehicle.
Information vs. Marketing: A program intended to inform, such as a video press release or employee benefits video, is most effective if it doesn’t look and sound like a commercial. Both can be entertaining and both can be clever, but “flash” tends to undermine the credibility of an informational video just as direct information doesn’t necessarily make a good commercial.
The script: When preparing a great meal, the ingredients you choose are crucial. The same can be said of the ingredients that are part of the script. A good script is the recipe for an effective video. (Okay, even I’m getting sick of the kitchen analogy.) But the key purpose of the script is tell a story. In fact, the importance of history cannot be overestimated.
· Scope of the budget: In most cases, the budget defines the quality and the quality is determined by the budget. The narrower the range, the more your provider knows that you know what you’re doing. If you give a producer or contractor a range of $20,000 to $100,000, you are setting yourself up for dramatically different results.
The Blueprint: A video project script is similar to a blueprint for a kitchen remodel. In both cases, plan changes can be costly. Adding scenes while shooting is like moving a wall back 10 feet after framing. Such changes are the main cause of cost overruns and should be avoided. Keep in mind, however, that some changes are unavoidable and it’s wise to include at least a ten percent contingency for the unexpected.
The market for video production services has become much more crowded in recent years. Budgeting for film and video production can be a confusing process, but just like a kitchen remodel, a proven professional will deliver a great product at a fair price.
