A pro-active examination of video marketing budgets and strategies
Tim Cumming and Helen Pain, updated 11 Jan 2022
- The boundaries: a business video is one of the most pliablely priced business services going - anywhere between £50 and £50,000 for about 2 mins, depending on about 16 factors.
- Regular tracking: Annual and quarterly planning should benchmark the way for tracking your commercial results.
- Rule of thumb: Aim for 5-10% of your desired return, up to a reasonable limit. It's all about knowing that desired return, and to hit desired targets.
- Super-shrewd: If you want real value, you should buy beyond video - specifically response - and implement an effective quarterly plan to drive your annual plan and your long-term strategy forward. That means buying the big four components in appropriate measure:
Woah! The vast price range
From DIY templates at £50 to glamorous crewed productions at £50k, choosing a price tag for a business video can look bewildering. When it's too high and too low, you probably have a preference for a goldilocks price, right? But if you're quoted £5k, is that right for you? Is £25k? Let's demystify video pricing for you, and give you some buyer advantages.
Before you call round a few video firms for ballparks - as you certainly should do - spare a few moment's thought for your purpose: where do you want to be at the end of this project? If you have a clear goal, good preparation is key to ensuring you create the right strategy. You'll cleverly save yourself a lot of hassle and time - and, most importantly, cash - if you just nail this early. The 2020 Gartner report on the new B2B buying journey clearly suggests that the traditional journey has gone. Marketing has absorbed some of the role of sales. So today's video investment has to be more shrewd.
Always have a goal
Four shrewd steps to video budget confidence
There are four big drivers in video projects - the drivers of all marketing projects. Often-neglected, hidden in the mists of our marketing minds, these wisdoms are actually easy to define. The components of purpose.
The Four Cost Drivers for Video:
Get these clear and you'll have an easy job of setting a sensible budget. And that means choosing a video company's going to be way easier.
Step One: Ambition
The secret to creating a successful budget is knowing your intended timescales: How far do you want this video project to go? Is this a step-change, or a top-up? A moderniser, or a fit-alongside? How much does this video project need to change behaviour? And whose?
If your answers feel modest, uncertain, or you haven't got the time, you might reflect on why you're doing video at all. An infographic or photography might suit you better. If, on the other hand, your answers feel mountainous and far-reaching, you might consider a pilot to keep things real, and avoid over-investing. That'd be canny.
And if your answers feel just right - kind of goldilocks - just put a number on the desired returns. Let's say a sale is worth £50k lifetime value to you, and you close one in five leads. That makes an enquiry worth £10k. So, if your ambition is for 100 new enquiries within a year, this makes your ambition worth £1m. You're wiser to an eventual budgetary size.
The maths of this ambition:
100 enquiries x £50k / 5 = £1m of new business value.
Depending on which bowl you choose to eat from, you will need to discuss these objectives in your quarterly meetings, and how your ambition will impact your annual plan.
Now you've got a rough number, you could even ask yourself if video is the best investment here - would it be wiser to invest in remote sales agents, or inbound marketers? They're all means to the same end. It's worth the thought.
Step Two: Scope
Simple question this, but what exactly do you think you're buying? A video? A video embedded on your website, optimised for search? A video seen by some people out there? A video seen and loved by many? A video that changes attitudes and beliefs? Or are you buying a measurable response?
Unless you've got a sophisticated marketing or educational programme going, it's hard to justify anything but the last option. When you think about it, you're probably not buying a video, nor a video with an uncertain deployment onto site and search, tied to some vague placement on social and other media. You're not even buying viewings, or 'eyeballs' as they're known in social marketing. Nothing short of response should suffice.
This is the moment to involve your taskforce and plot out your CTA (call-to-action). What do you want to achieve in your annual business plan? What's your long-term strategy? Where do you see your growth? Make the CTA your response.
For example: 1,000 call-to-action (CTA) responses to the video, converting 10% to 100 new enquiries within a year, worth £1m. Hmm, familiar ring to that. Then you can cost.
The maths of this scope:
1,000 CTA clicks x 10% = 100 enquiries, worth £1m in new business.
Now you're warming up your shrewd. Your video firm should have a good idea of what CTA would work here, and how best to plan for it over each quarter. Don't expect the crystal ball; all good marketers (that's you, Petunia) know that trial-and-error is the only way to go.
Step Three: Risk
No matter what end of the risk spectrum you're on personally, it's wise to remember that it's always your business carrying the risk. In a video project or campaign, that translates into how much activity - and its associated risk - your firm is capable of handling in-house.
Can you properly host, embed and SEO? Can you absorb the risk of wrong-doing? Can you place well on social media, on forums or national media? Can you build lists around the target audience, and find the right locations for their reasonable attention? What happens if you fail?
It's reasonable to discuss this with colleagues and go with your communal gut. Decide who you want in your quarterly meetings, set out a clear agenda, and allow time to debate and discuss because it'll take a fair bit of time to calculate the risks.
Unless, of course, you're an actuary. You might find that you're cool with web deployment, but a bit exposed on the rest. You can ask your video marketer to carry the SEO, configuring and populating a Youtube video channel properly, social and other media placement, engagement, prospecting, analytics, sentiment and intention capture.
Let's say you're confident of being able to handle 10% of the deployment and placement work in-house. That's a helpful contribution to the 100 enquiries within a year, £1m. A pattern must be forming here, surely.
The maths of this risk:
Absorb 10% of the risk in-house, expect a 10% saving on deployment or placement.
Step Four: Dependency
What's riding on this? A huge revenue recovery programme, or just looking a bit sharper online? The productivity of all client services, or perhaps a first attempt at upselling? The importance of the dependency is useful to know as it drives the level of acceptable ROI.
When it comes to your annual plan, it's always wiser to invest in essential items than discretionary ones. You NEED the essentials to happen; you'd LIKE the discretionaries to. So, essentials generally suit lower ROI, and discretionary, higher. Let's suggest an ROI spectrum of around 400% for essential, ranging to 800% for discretionary.
Once you name a dependent outcome, you can easily estimate the contribution of video. And voila, you have a number.
Let's presume that 40% of your client's decision making happens online (most B2B decision surveys say it's now over 60% and rising), and you attribute only a quarter of that to new videos. You'd be apportioning 10% of the new £1m enquiry flow to video - that's £100k in value. And as it's essential, a £25k investment yielding a 400% ROI would give you £100k.
The maths of this dependency:
40% / 4 x £1m / 400% = £25k budget.
Already got this covered?
If you already have business videos and they're not generating response, there's much above that will help you improve their performance. But what would be even better than your current business videos?
- Cross-check all your business videos largely follow the above suggestions, or deviate for good reasons
- Ensure you've used on-site CTAs which match your buyer journey moments
- Ensure your social videos, articles and posts have off-site CTA's that match your buyer journey
- Check your business videos match the messaging your audience needs to hear
- Check viewing behaviours - if audiences aren't watching to the end, revise your video
What's at Risk here? A one-minute test
The risk of doing something wrong always hinders us as decision makers. And equally, the risk of doing nothing lurks behind that too. Both carry the risk of failure. So why not delay - deferring looks safer. Like a Whitehall mandarin. Is that the kind of decision maker you want to be? Thought not. So here's a helpful checklist for wise decision maker inside you that's aching to be heard.
The One-minute Decision Checklist
- Do buyers want to know what you're like?
- Do buyers want proof of your success?
- Should you provide buyers with the information they want?
- Do buyers want a sense of what will happen to them if they buy from you?
- Do buyers need to find you easily via search and social media?
- Do you need to be seen as relevant and modern?
- Define your intention
- Consider buying beyond the video itself - into web deployment and into social and other placement
- Polish it off with an informed gallop through the gamut of cost-saving ideas above.
If the answer to any three of these is yes, you should almost certainly proceed with this. Or at least be questioning why you have so many no's.
And there we have it, our four quick drivers. Hopefully, you'll feel more confident about what you're really buying, its value to the business, and your desirable ballpark, in order to implement a cost and return budgeting strategy.
It may be that, as you explore these drivers, you realise that you don't like what you find, for example your ambition or dependencies are too modest. Or, your scope or risk are too big. Frankly, it's better to know that now than wade into a video project and discover an ugly truth too late. Sadly, we see many firms feeling that, and it leads to pain. Four moments of reflection (and maybe four minutes of rough maths) can remedy that.
If you want a price for a measurably rewarding video:
With corporate video , hardly anyone buys wisely. So you'll be ahead of your competitors. Stay shrewd, Jude.
So, now you've weighed up cost and return budgeting strategy, you've moved towards your goal. Time for a chat about success with video?Book a Video Marketing Demo