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The big question....How much does it cost?

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Grant WilberThe big question....How much does it cost?
by on Feb 4, 2012 at 9:38:42 pm

This is my first year doing video stuff and it's going decent. I'm getting to the point where I've got enough experience and am confident I'm not gonna screw up a shoot where I'm trying to get more competitive with prices. I'm not much of a salesman and worse, hate asking for money.

Most of the people I deal with are new to video and alot have 'no idea' for budgets. What are some tips or advice on giving people prices vs what they are going to get. If I tell someone I could do it for $500 cheaper but won't be able to rent more lens' or camera they are probably not gonna care although I know it could be a less effective video. Or if they are willing to pay more than what I had in mind I could bring in a lighting guy to make it more polished or bring in an editor who could do a better job coloring or animation.

When someone says they don't have a clue for budget what is your next step? Do you give them two or three prices. Do you explain the differences between quality and get into tech talk thats over their head? Or do you just give them a price for the video you think they will need and leave it up to them to know if it'll be worth it.

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Fernando MolRe: The big question....How much does it cost?
by on Feb 4, 2012 at 11:38:37 pm

Price is one of those things that make you unique. You know what kind of work you like to deliver, your quality and your costs. Finding your price is both a math problem and a testing process.

I hope this helps

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Craig SeemanRe: The big question....How much does it cost?
by on Feb 5, 2012 at 7:32:38 am

Here's the math part

My own rule of thumb is to assume you have meet all your expenses (both business and life) and make profit on about 20-25 paid hours of work a week. As your skill improves so can your prices and profit. That's impacted by local competitive prices. You can't make less than all business and life expenses unless you expect to eventually sacrifice one or the other.

BTW that you understand you'd cut costs when lowering a rate is a good start because too many people simply lower the rate and eat the cost or give away the hours. Clients have to understand something goes when the price drops.

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Mark SuszkoRe: The big question....How much does it cost?
by on Feb 6, 2012 at 7:50:55 pm

Grant, when I'm in your position, yes, I prepare a couple of packages and I take the time to educate the client and explain the differences. It's about managing expectations, and educating them so they understand WHY anothe guy's lowball bid is lower, compared to what they are getting from you. This builds their confidence in you and show them that ypu're not just rinning a bill for no good reason. You are laying out a "value Proposition".

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Craig SeemanRe: The big question....How much does it cost?
by on Feb 6, 2012 at 8:26:31 pm

[Mark Suszko] "You are laying out a "value Proposition"."

This is so major important when it comes to sales. Don't sell price, sell value. That should be implanted into the mind of anyone going into this business.

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Steve MartinRe: The big question....How much does it cost?
by on Feb 11, 2012 at 3:39:12 pm

Grant, I'll echo what others have shared and offer this as well...

First, do your best to evaluate weather or not the person you're talking to is "coach-able." When they say they don't have any idea what things cost, it doesn't mean they're telling the truth or worse that they even want to understand.

If in fact, they don't but want to understand, then it's often worth your time to educate them. You may or may not get the job, but it's still worth your time since you can learn to hone your message and sales approach in both wins and losses.

Before attempting any client education on costs, you need to educate yourself on the things that matter to the client. I usually try to get them talking about why they're doing the project. What's the desired outcome? How will they define success? Ask penetrating "big picture" questions about the their business and the audience that will watch the production. If they're a serious potential client, they'll likely relish the opportunity to talk about their organization, themselves and the project goals.

During that process, two important things will happen.

1) You'll have a much better understanding of the client's needs. This will give you a leg up on any competitor who just talks about cameras, software and other technical gizmos that the client doesn't give a hoot about

2) You will gain the client's trust. You'll likely ask questions that no one else did. They will sense that you understand them better than the other production companies they talked to - because you will.

This process doesn't have to take long. It can be a very simple phone conversation that lasts only a few minutes. But each situation is different - so you'll need to adapt as necessary.

Once you've earned their trust (because you're focusing on them and their needs), they are open to your education message.

One education process that I use is to break down the process into three bite sized steps (pre-pro, production & post) with basic non-techie explanations for each. For each part, you can explain some possible approaches and related costs. Ask questions about their thoughts along the way so that you know that your message is getting through. Encourage them to ask questions as well. The more engaged they are more they understand what you're "teaching."

This "consultative" approach is much more work than simply providing a price, and not every prospect will have the patience to participate in it. It also takes practice and you'll learn as you go.

But in my experience, the effort is worth it.

I hope this helps...

Production is fun - but lets not forget: Nobody ever died on the video table!

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