Most marketing teams don’t understand the real costs of a video project – they just have a number in mind, and hope for the best. Too often, that number is just a guess, and expectations don’t match estimates. If you think video costs too much, it’s probably because you’re expecting Mercedes quality on a Kia budget, but you don’t know why a sedan costs less than a luxury coupe.
Understand what you’re paying for before you break out the checkbook. This guide is how a production company puts a corporate video budget together, and what you should look for in their quote to make sure you get what you need.
The Three Phases That Make Up Every Video Budget
Every video you’ve ever seen, no matter the size, moves through three phases: pre-production, production, and post-production. Each one has its own cost structure, and each one behaves very differently when things go wrong.
Pre-production is planning – scripting and storyboarding, shot lists, scheduling, and location scouting. It’s almost always the smallest phase in raw dollar terms. It’s also the phase with the largest proportional pull on your total budget, since every hour spent here saves five on the back end. Missing shot list? You’ll shoot more than you need. Unclear script? You’ll reshoot. And yet, all the real money is spent during those long 12-hour days.
Production is the shoot: crew, equipment, talent for performance and voiceover, and the actual location for the day (or days) of filming. This is where the big line items are, and therefore where most clients focus their attention when looking over quotes.
Post is everything that happens after the cameras stop rolling. Editing, color grading, sound design, music licensing, motion graphics, and revisions. We like to call it “unsung post”, because it’s the phase they always forget when they call you asking for changes two months after the final video is delivered and everyone’s taken their check to the bank.
What’s Actually Driving Your Quote
When you receive a number from a production company, it’s not a single price but rather a compilation of various line items. Knowing what each of these represents can give you a clear picture of what you’ll be expected to pay for.
Crew day rates: This is likely the biggest variable cost involved in most shoots. The director, cinematographer, sound engineer, and lighting technician all charge per day, and the rates vary depending on their experience and the market. The cost of a four-person crew for two days is roughly double the cost of a one-day shoot. It seems obvious, but sometimes clients assume that adding “more locations” won’t result in a small cost increase but rather will only require an additional full day.
Equipment and camera packages: This will depend on whether the crew owns their own equipment or has to rent it. A video production company in Orlando that possesses its own cameras, lenses, and lighting packages can offer a lower estimate than one that must rent a full package specifically for your project. This has a bigger impact on the number than most people realize.
Talent and casting: This is often overlooked by first-time clients. If you need an on-camera presenter or real actors rather than utilizing your employees, you’ll have to cover casting fees in addition to day rates. Union talent has different rates from non-union talent.
Location fees and permits: These are the fees associated with shooting at a location other than a controlled studio. This includes rental fees, permit filing, and travel expenses if the crew needs to travel to the location.
B-roll footage: This not only increases shooting time but also editing time, although it might not appear as a distinct line item. It will, however, be included in the final bill. This is generally a good investment because B-roll footage provides editors with leeway for cutting around interviews as well as covering audio problems.
Why “Cost Per Finished Minute” Is A Bad Way To Budget
Many marketers use a ballpark rate per finished minute to guesstimate video costs. Not only does this method not work, it also provides video clients with some likely very unwelcome budget surprises. A 60-second animated explainer with all new custom motion graphics and a licensed voiceover track costs more than a five-minute interview-style video with a single location and one camera setup. Runtime has almost nothing to do with total investment. Scope does.
The other issue vendors have with a “give-me-a-ballpark-cost-per-minute” question is they don’t know what to quote until they know how many bells and whistles you want. Do you need actors, makeup, multiple location shoots, a dozen crew (art directors, DPs, audio techs, production assistants, gaffers, etc.)? Do you need cel animation, 3D animation camera tracking, product rotation in 3D space, original music composition, exotic locations for stock video, unique drone footage, the buying of multiple media licensing components for on-set playback? Any one of those items adds measurable to significant costs to a project.
Two seemingly similar length videos can have one budgeted at $20,000 and the other at $200,000 based solely on these scope considerations. If a vendor gives you a knee-jerk, one-size rate off the top of their head, they just haven’t given it enough thought to what you’re really looking to accomplish.
DIY, In-House, Or Professional Production Company?
Many marketing teams boot up their own video production arm before giving a production partner a ring – which makes some sense, and can be the right call sometimes. You need a lot of video, and shooting it yourself is cheaper… right?
Sure, try that internal pitch update or recruitment video shot on your phone that we mentioned up top. But once you’re talking TV ads, or serious client brochures, the math changes quickly.
In house production is actually really expensive, it’s just that a lot of the costs are hidden until you start paying salaries to people who aren’t doing their actual job because they’re busy learning Premiere, or until that camera you bought goes unused in a closet for six months. Or until you have to pay that salary guy to reshoot the entire thing because the sound was garbage on what-you-assumed-was-the-only-take. A real cost that’s really easy to hide.
When you hire a production partner, they bring all their own gear that’s already paid off, all the insurance your shoot is going to need, and post-production crew who don’t have to learn their way around color grading while cutting your project. And while we’re on that topic, bidding and selecting a partner – vetting them on local market knowledge is even more important than potential partners realize. A crew that already knows the local talent pool and locations is going to burn far fewer hours and have hardly any nasty surprises compared to a squad who had to fly in. And it generally ends up saving more than it costs.
The Phase Everyone Under-Budgets: Post-Production
Production companies are known to exceed their budgets and post-production is mainly to blame. The costs of the editor’s work in long or more challenging projects increase rapidly. Color grading and sound mixing do not fall under the editing expertise and often, they are not even acquired from the same individuals. Similarly, motion graphics and animation are isolated from the editing of the live-action since they necessitate distinctive software and specialists.
Music licensing is also a sector where clients are taken aback by costs. Royalty-free soundtrack music and a commercial sync-licensed music vary significantly and depend on the intended usage and the duration of the video. If they include a general “music” item on the bill without the license specifications, make sure to check that.
Usage Rights Change The Price – Always Ask About This
One aspect of a video quote that many clients find confusing is the topic of usage rights. For example, how long will your video be used and where will it be shown? A video that can only be posted organically on social media will be quoted at a different price than one you can also pay to place as an advertisement. Similarly, both will be priced differently from a video that will be used as part of an internal presentation or training session only.
These details are often included in the quote, but if you don’t see them listed, the production company has likely included them in the total and is sizing you up based on how accessible your wallet appears. If you think you might want to reshare as an ad or use the content longer than a year, bring that up during the early quote stage. Post delivery, it’ll end up costing you more to buy back your own content.
Getting Quotes You Can Actually Compare
Once you have a solid grasp on the line items, the real headache is trying to compare multiple bids that are organized in totally different ways. The solution? Demand these three things from every vendor.
First, a detailed scope of work (SOW) outlining what you get, when you’ll get it, and how much you’ll pay for it. The more straightforward and specific this document is, the fewer issues you’ll have down the line.
Second, itemized line items, not lump sums. If a proposal reads “$8,000 for corporate video,” push to get the cost broken down by phase.
Finally, a revision count. Every bid should tell you up front how many rounds of revisions you get. “Unlimited” sounds nice, but that typically means the vendor padded their price because they’re assuming you’ll be back and forth for months. A set number – we typically include two rounds – ensures you’re both on the same page and protects you from vague revision charges later on.
Matching The Budget To The Marketing Goal
The optimal budget isn’t the smallest one; it’s the one that’s aligned with the purpose of the video. The cost of producing a single attention-grabbing hero video to be featured on your website is roughly equivalent to producing five shorter vertical videos designed for sharing on social media. And there’s no right or wrong answer. The optimal solution is determined by where your target audience interacts and engages with your content and where they are in the marketing funnel.
Identifying what the video should achieve comes before budget planning: do you want to increase brand awareness, get more leads, support sales activities, or develop your employees? The answer to this question will help you choose between a single longer video or multiple shorter assets that you share across various channels.
Build In A Contingency Buffer
Weather conditions can change. Locations can become unavailable. Talent can fall ill. A 10-15% buffer over and above your production budget can help you account for any rescheduling, additional shoot days, or last-minute location changes. With a buffer amount in place, your project can stay on schedule, and you won’t compromise the final output by rushing through shots just to get the project done on time. Instead, you’ll be able to apply that buffer amount to wisely reacting to changing circumstances or needs as they come up. Most importantly, your buffer won’t be a slush fund to cover overspend, but a tactical asset there to ensure you get the best possible video for the money you’ve allotted.
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