Executive Decisions: The Budget Dance
By Russ Jolly - published May 2006
The tango, fox trot, and cha cha on television's Dancing with
the Stars are no match for the extraordinary maneuvers a corporate
video producer and potential client often display during the stirring
pas de deux otherwise known as "The Budget Dance." Performing
this dance requires spinning, twisting, and staring eye-to-eye all
the while making sure that toes don't get crunched as the fast-paced
steps of deal making are executed. It can be grueling work, but
with some practice, any producer can learn to become smooth and
graceful when creating budget estimates.
The question I get asked more than any other during the first contact
with a potential client is, "How much does it cost to produce
a video?" Typically the person inquiring relays little information
about the project other than "We want a 20-minute training
video" or "We're looking for a 3-4 minute marketing video—how
Obviously, a lot more detail is needed to understand the scope
of the project before providing an initial estimate, but sometimes
after asking only a few preliminary questions, I'm interrupted with
a response such as, "OK, that's great, but how much?"
My standard reply goes something like this: "How much? Well,
if we do it right, it won't cost a thing—you'll make money from
your investment. So tell me, what kind of results would you like
to achieve from this project?"
By stressing the importance of return on investment, you can steer
the focus away from expense and frame the conversation on results.
This is not a sales tactic or gimmick. This is the truth. I have
never had a corporate client come to me to buy a training or marketing
video. What my clients want is greater productivity, increased sales,
improved fundraising, or reduced liability. They want solutions.
They want results. Sometimes they just need to be reminded of that
fact. Once this point is firmly established, I can recommend a range
of options to help them reach their goals.
One of the first steps of the budget dance is to qualify the client
and be sure they have an appreciation of the investment required
to create custom video. It is imperative to know before setting
up a face-to-face meeting that the potential client is willing and
able to make an investment that is commensurate with your experience.
A simple approach you can use to get the budget conversation rolling
in a positive direction is to briefly describe case studies of video
productions you've created for previous clients. By explaining the
problem a previous client faced, the video solution you created
to help the client, the results achieved through use of the media,
and the investment the client made to get those results, you can
accomplish several goals. You stay on point by referring to video
as an investment, you show a successful relationship with another
company, and you positively portray your experience as a producer.
Relating a few brief case studies with differing production values
and price points can signal to the potential client your flexibility
to work in a variety of budget ranges. You can follow this up with
a couple of very direct questions: "Have you established a
budget for your project?'' and "Are the projects I described
in line with your projected budget?"
Another way to break the ice on video pricing is to use an analogy.
I have often explained to clients that the range of pricing for
a video can be similar to the range of pricing for an automobile.
My part of the conversation typically goes like this: "Many
brands of cars will get you from Point A to Point B. How you choose
to get from Point A to Point B is another matter. You might choose
to drive a Rolls-Royce, a Chevy, or a Yugo. Many of our clients
choose a Chevy-type video and are very happy with the results. Some
choose a Rolls-Royce-type video to tell their story because they
need a higher level of production value. What approach do you think
would best represent your company?" As you might guess, I don't
extol the virtues of the "Yugo video."
Once the company has been qualified, it is time to set up a discovery
meeting with the decision makers present and have an in-depth fact-finding
session using the questions I wrote about in my March 2006 column,
Twenty Questions. At the conclusion of this discovery meeting, you
should have an accurate view of the scope, timeframe, and production
values required for this project. Furthermore, you cannot leave
this meeting without having a solid idea of the investment range
the client is willing to make for this project. Ask for their budget.
I'll admit that creating budget estimates for corporate videos
is one of the most challenging parts of my job. Every client comes
to the table with different needs, different perspectives, and different
levels of experience in the production process. Some clients are
completely new to video production and truly don't know what kind
of investment is required to create a powerful presentation. Other
clients have used videos in the past, but are not as adept at communicating
their vision in a manner that allows for easy calculation.
There is no such thing as "one size fits all" with the
corporate videos we produce. Each project is a custom job. Hopefully
some of the tips above will help you glide through the budgeting
process more gracefully. Happy dancing.
Russ Jolly is owner of 214 Media: Dallas, TX corporate video