Let’s start here:
In a study done by CEB, 67% of the buying decision is complete before the customer calls a company. And, even if this number isn’t that high, customers are still educating themselves much more now during the buying process. Essentially, the age of the ripoff is over…thanks to the internet and the power of information.
With the use of the web, a buyer can compare price points, look at quality and even make decisions without ever talking to a sales rep. So, with that said, you should absolutely share your budget with the video production companies you are thinking of using.
But, why?
Without sharing your budget, you force the video production companies to guess as to what you’re looking for. An “About Us” video could cost $5k or $100k and both could be great for your specific objectives. It really depends on what you, as the customer, are looking to spend and what you find of value.
Let’s use an example:
Mary of ABC Software wants a case study video. She goes to five video production companies and doesn’t disclose her budget, but rather asks, “Can you tell me what you think this would cost?” Mary doesn’t want the companies to just go based off of her number, she wants to see what they can provide. Completely understandable.
Well, here’s the issue. Mary is now going to be comparing guesses from five companies. One company thinks Mary’s company, based on what they’ve seen in her industry, warrants a $50k budget. Two companies feel that ABC Software’s requirements don’t warrant a larger project budget for this case study and quote Mary at $5k and then the final two companies fall within the $10k – $20k mark.
Mary’s budget was $12k and now she only has two companies to evaluate from. The $5k quote was missing some key requirements and the $50k budget didn’t make sense.
Conversely, had Mary told all five companies, “My budget is $12k. I would like to see samples of work you’ve done at that clip and also what I can get with that budget” then Mary would have had five companies to evaluate from. They all would’ve provided her with the best offer within that ballpark range.
From that point, Mary can then evaluate from a quality perspective and a quantity perspective.
Quantity?
Yes, you can get more when you let companies know what you’re working with. In this situation, let’s say two companies offer Mary one shoot day and a 2-3 minute video. Two other companies offer her two shoot days with a smaller crew and a 2-3 minute video. And the final company offers Mary two days of filming at two different locations, a 2-3 minute version and a 30-second cut for social.
Well, now Mary can look at that final company and determine if their quality is up to her standards. If it’s not, then she can then look at the other four and evaluate which approach she likes the best.
With the resources available to customers online, companies are not out to try to give you the least amount for the most money. It’s actually the opposite, companies want to know your budget so they can put the most value possible into your budget while still staying within their parameters.
For more information on setting up your project, check out our First Timer’s Guide to Producing Video where we discuss the budgeting process and other key steps to making a video.