An extra-thorough examination of the likely, hidden and true costs of video
By Tim Cumming and Helen Pain, 4 Feb 2021
Let's say you've been thinking about corporate video for a while now. Those costs can look pretty varied, and you might be pondering: should we go Rolls-Royce or second-hand Fiat? Maybe you're thinking: what are the financial pros and cons? Or, maybe, you're not sure what you should be thinking.
This article looks into all the various costs that you may encounter and will help you to make up your mind.
The likely costs of your video marketing would include the production: creative planning, filming, editing, and post production. Most video companies will quote for these and many buyers - hopefully not you - will tend to regard the cost of video as merely being these direct, obvious, visible costs. As we'll see in this article, this is far from the case.
Costs that you'll be billed for include:
- Research: This is largely defining your audience, their needs, your brand expression and your message - depending on the scale of your project, expect to pay anywhere between £500 and £5,000 for this. A rough rule of thumb is allow about 3-5% of the project budget here
- Planning work: This is logistics for filming or animation, booking your team (the cast) and crew, Whether remote filming or locally filming, you could pay £300-£3,000 depending on project scale. Allow around 1-2% of the budget for this
- Creative costs: The development of ideas and mockups for all footage except documentary footage, visual metaphors, illustration, graphics and animation. It's wise to spend around 5-10% of the budget here. You may not get these singled out individually by your video supplier, but together, research, planning, and creative, would be around approximately 10 to 15% of your project costs
- Filming costs: These are typically between £1-3k per day for a conventional or remote filming day, involving a director (or producer) and a single camera person and interviewer. Expect to pay a bit less for a day's drone footage, or more for an unique day's filming (unusual locations, filmic looks or a more professional crew)
- Editing costs: These will be around £200-£1,200 per finished minute of video, depending on the quantity you buy (economies of scale apply) and the quality of the editor.
Explore our four shrewd guide to setting a video marketing budget, and our comprehensive list of video savings opportunities.
2. Hidden Costs
The hidden costs of video are all associated with overlooked activities. These include:
- Hosting and optimising the host channel
- Thumbnails and optimising for clickability
- Tagging, naming and describing to SEO standard
- Embedding on your website
- Video schemas for search engine results pages
- Video sitemap for search engines' crawling
- Video sizing to optimal impact
- Production of responsive versions of your videos
- Describing and tagging the videos (so that they're optimised for search)
- Producing tasters and teasers - these can easily be shared on social media, blogs, or forums as separate entities, which can direct traffic back towards your website.
The other hidden cost is placement work, which is the act of achieving high viewing figures among audiences that you don't yet know or can't directly influence - this includes influencer and group marketing. If you don't get an audience to see your video, they can hardly react to it, or respond in a commercially useful way.
All marketing has hidden costs, whether it's writing copy or sourcing imagery and producing them for the web. Everything has to go through a kind of responsive filter, so that the copy or the pictures will work on laptops, desktops, mobiles and tablets. Imagery, for instance, requires multiple sizes and versions for different devices.
3. Opportunity Costs
Opportunity costs - the lost benefits of unchosen paths - are so badly named, aren't they? By definition they're unseen, and easily overlooked. But, the formula helps us (thanks to Investopedia):
Opportunity Cost of Video = (Return of video - Return of some other marketing)
But in practice, it's more like:
Opportunity Cost of not-video = (Return of not-video - Return of video marketing)
To push this to a logical extreme, we might think from the outside in.
Opportunity cost of buyer enablement
It's remarkable how many firms appear to assume that clients will continue to flock to them, and stay, by simply doing nothing. If there's one thing that lockdown, Brexit, Zoom, and the growing buyer enabled epoch has taught us, it's that the world isn't just changing at an accelerated rate, it's changing in ways no one could have predicted.
Who, for example, would have expected a preference for digital buying, research, price comparisons, analyses, and capabilities studies online, over meeting a sales person? For the buyer's increasing faith in their own decisions and relative inexperience over those of a salesperson? Yet, this behaviour is very clearly documented in Gartner's reports - there's a wonderful article there on buyer enablement, which is Gartner's term for addressing this very particular trend.
It's simply commercial suicide to ignore this growing preference for greater understanding of your proposition and offering, not just its character or its ways, but also its pricing, benefits, outcomes, downsides, and risks. All of these things are sought by present day buyers. And, if your website doesn't address these things, you're really not competing with the best for now, but in the future, you'll be left far behind.
Gartner documents a huge paucity between the desires of B2B buyers on the one hand, and the vast majority of websites and social media streams on the other.
Try this ten-minute test:
- Google a business service, i.e. legal advice or private equity. Add the term 'prices', 'outcomes' or 'calculator' in double quotes
- See how many websites you find that help you to estimate or forecast:
- your future working with that firm in numerical terms
- modelling or predicting a changed state for your firm
- the costs involved in doing all the above
- Score them 33% for each (You'll be lucky if you find more than one or two, and they might not even be in this country)
- Now look at your own website. Do you really reveal that kind of information? Score yourself.
So, the true opportunity costs of a client aren't just hurting your business, or turning it into decline. They might be more subtle or nuanced, like falling behind, becoming easy prey to competitor marketing action, or simply being more old-fashioned or less appealing to the new kind of buying behaviour documented at Gartner.
You could spend money on sales and selling, and this is where Gartner's report is so revealing. Buyer preference for digital information used to be the domain of the sales team; the marketing team merely had to attract footfall and visitors to the website and the Contact Us phone call, button or webform, and for far too long it looked as if it was the only way of bridging the gap from website and digital marketing into the sales environment.
Clearly, buyers have overtaken this, and are actively seeking far more digital information to help them not just make a decision, but to understand the calibre and character of your business. This is where video is so useful.
The true opportunity cost of marketing may appear to be in sales activity, where you might further invest in hiring more salespeople, telesales or remote sales agents. Even in some of the most sophisticated relationship-based industries (banking, FinTech, insurance, Private Equity and VC, etc.), the sales team, with their heavy reliance on personal relationships, are increasingly expecting helpful, visionary, predictive, growth-full and reassuring information, videos and tools, to help them make a buying decision before they contact you for confirmation.
However, as Gartner clearly documents in their buyer enablement paper, it's no longer the case that buyers want to talk to salespeople - they want far more from your marketing. You might say the true opportunity cost of marketing is clients, and to under-invest in marketing - contemporary buyer-enabled marketing - is really to dispatch or discard the winning of clients. The role of marketing today is really about generating an informed, educated, willing buyer. What used to be called lead-gen perhaps ought to be called buyer-gen.
This is the opportunity cost of video itself, as opposed to other forms of marketing that might include conventional methods (such as email marketing, Pay-Per-Click, Search Engine Optimisation), and the use of copy, imagery, and tools, so that users can interact online with your proposition.
While buyers know that all messages you publish online, socially, and on the web, are far from accidental (we expect them to be optimised in order to sell), the one place that buyers don't expect bullshit or fabrication is the video. It's the one place they can rely on, within reason, to get a sense of who you are, what you're like, the calibre and heft of your team, and the capabilities of your firm.
The opportunity cost of leaving this out from your marketing is considerable, and could drastically impact the believability of much of your other content. It's helpful here to see video as an affirming kind of activity as opposed to a factual one, although, even the softest video can complete and conclude with a very strong CTA which, in itself, delivers high value.
- Client: Embrace the greater understanding of your proposition and offering - its character, pricing, benefits, outcomes, downsides, and risks
- Marketing: Less reliance on salespeople, more on contemporary buyer-enabled marketing
- Video: Consider interactivity over conventional marketing methods.
A good corporate video, that shows what your buyers want, can create opportunity and stimulate growth:
- Challenge: consider your clients, marketing and video costs, and how best to utilise and adapt to a changing buyer landscape
- Strategy: choose an agency who plan an effective marketing strategy and strengthen your CTA to help audiences connect with you
- Response: follow agency advice to maximise visibility and SEO optimisation
- Cost: choose an agency who give you value for money with no hidden costs or time wasted
- Post-production: recognise the benefits in value through established video improvements, deployment and placement work
So, now you've contemplated corporate videos costs - you've moved closer to your goal. Time to explore the process as it applies to you?