Commercial Spots: Pricing

jrazz wrote on 8/6/2008, 1:06 PM
I have been approached by a local radio station about filming content for their advertisers to be placed on their website. They will be either 90 seconds or 120 seconds long and strictly in a web-based format (probably flash).

I am going to submit a proposal to them (I really have no competitors in my area doing anything other than weddings) and need for it to include travel (about 8 counties) , setup, filming, and editing. I will not be hosting it so no hosting fees in the mix.

I normally charge 60 per hour for 1 camera, 80 for 2 and 100 for 3 and 80 an hour to edit. I want to be fair to them as I know this will be a long term relationship and be steady income as they are going to include this in with their on-air advertising (it will not be a seperate purchase).

What do you think a reasonable proposal would be for this based on the information above? I am just asking for some general opinions and insight. Thanks guys.

j razz

Comments

richard-courtney wrote on 8/6/2008, 2:22 PM
First I think your rates are too low but that depends on your location.
You could keep the windshield rate low but you need to figure out wear-tear
on your vehicle(s) and fuel costs.

The web is a good place for video and certainly is better than tv spots cost wise.
Web needs good lighting and sound and that means experience. Don't under sale
yourself. I don't know if you need per camera as most commercials are not live events
and can be edited for continuity. Talk to the voiceover talent as there service may need
to be added to your package.
jrazz wrote on 8/6/2008, 2:28 PM
My prices are low when compared to what most charge on this board, but in my area they are on the high side.

Lighting- thanks for bringing that up. I saw on the board a year or so ago about a do it yourself consisting of items bought from Lowes that works great and on the cheap. I could spend say around 800 or so on lighting, but where should I begin to look? I haven't had need for it in the past as most of my work has either been live or filmed outside. As for experience, that comes by doing and starts with good advice- would you recommend Vic's book on Lighting it Right?

The voiceover talent will be supplied from the radio station- no extra charge there either. The station is a talk radio station and they make all of their commercials for locals and they do a great job on them.

j razz
FrigidNDEditing wrote on 8/6/2008, 3:18 PM
I've got a set of Interfit, lights are ok, setup time is about 20 min from start to ready to shoot ( cam and audio setup included in that ). they were about 500 with a wheeled case, and they're ok, however I'm not overly pleased with the tension rods they sent (carbon fiber that suffers from splitting and you find yourself getting carbon fiber slivers).

uses low power, so a person might be able to run from a power inverter pretty easily and very low heat. Overall, for the money pretty good, and if you get different tension rods then the only issue is setup and tear down.

re: your costs, I normally cost about 750/day (I consider a day 8hrs-10hrs, if it's going to be longer than that I will charge extra) with small interview lighting kit and single mic, single camera.

I'm also 60/hr for editing, but I bid it out to them so they know exactly how much before hand and if I go over, of my own doing I don't charge, if I go over because of something they want extra, then I let them know it will cost more. Pretty straight forward.

Dave

I'd say that you
Butch Moore wrote on 8/6/2008, 5:29 PM
Just sharing my humble experience.

I've found that many opportunities similar to what you describe fall into the "Quality/Fast/Cheap" scenario where you can only choose two.

As much as I like to pull out the big gear and charge thousands of dollars for a production, often the mindset for web video just isn't there...especially in smaller markets. Many small business people run scared of "per hour charges". I've found that most customers are far more comfortable with a base price for a project and full "before the fact" disclosure of any additional charges.

In addition to many other avenues of income, we produce a great number of local :30/:60 cable commercials for a relatively cheap price. We make our money on volume. Our price per commercial in no way reflects our regular production charges. We call it "our little gravy train."

This is where relationships come in. Through our relationship with the cable companies, we've determined what the market will support. Then, we in turn produce a quality product equivolent to that price. Actually, every commercial customer gets "more for their money" when they use us, because our TV commercial work has become our springboard to many other production jobs.

Having managed broadcast companies before, I can just about bet you they want it "Fast/Cheap". I would try to determine how much the market will consistantly pay, then figure out how to provide a profitable product at that pice.

At a reasonable, sellable price, the radio station ad execs will sell more and you will produce more. Business advertising budgets are limited. The station wants as much of the customer's ad budget to go into their coffers as they can get. Exorbitant web production costs add little to the station's bottom line.

With the help of VEGAS, we've developed a system of commercial production where we can pop out a $500 cable commercial in a couple of hours. Four or five of these a week really helps our bottom line.

My late Dad always told me "Son, you can do anything you want to in this world...but you'll have to find somebody to pay for it!"

I'd talk with the sales people and figure out what the market will consistantly support. Then, develop a profitable production based on that cost. Also, be sure you get to plug your production company either on the video or on the web site. Everthing you produce will then become an ad for you!

If the numbers add up, go with it...if not...move on.


winrockpost wrote on 8/6/2008, 6:05 PM
I would say Butch is dead on. I'll add forget about spending time on lighting , pack a tota or two and call it a day,, good audio is probably more important , These things are typically down and dirty , figure your price on spending no more that 2 hours per shoot, and make sure they know that. I would say they are going to gross you no more than a grand at the most. So prepare and get a formula down that you can make a dollar and still have a decent spot. IMHO
richard-courtney wrote on 8/6/2008, 7:46 PM
If your prices are on the high side and the radio station is still interested then
don't raise them.

As far as lighting most radio spots will fall into the small shop owners and you
will have most likely daylight coming in the windows. Invest in some black "shade"
fabric at garden center to place outside the store's windows to control glare.
This is not blackout cloth but cuts light level. Use gaffer's tape because it won't leave
a residue on the window frame or strip paint.

White/black foam core at craft store for filling shadows or flags and plenty of
c stands and clamps. Or a pair of Interfit http://www.interfitphotographic.com/Accessories/Product%20Pages/Studio%20reflectors.phpINT271[/link]
reflectors might be a better investment ($90 each) at your photo store.

Watch out for indoor florescent lights using ballasts, they sometimes change color
on you!
You may need the famous "nanolights" with 5500K CFL bulbs. With everything
mentioned you will be close to your $800 budget.
Patryk Rebisz wrote on 8/6/2008, 11:17 PM
$500 per commercial??? I shoot for fore then that and it doesn't even include the gear rental and other crew members. Forget about the post....
Rory Cooper wrote on 8/7/2008, 4:08 AM
An average free lance rate here is R800 per hour to edit “run of the mill editing” final edit
Prelim edits are less running through footage, hunting etc

Normally you will spend up to 8 hours to create a 30 seconder with audio

That’s if you have a decent storyboard and Audio library and footage

But if you are starting from scratch concept, filming ,art direction an average 30 sec ad can set you back. Right back.

The last big ad I worked on for Coke the lighting rental 7 DAY shoot only was over R1 million
The ad agent was Mother from UK their bill must have been the real mother

jrazz wrote on 8/7/2008, 6:46 AM
Guys, thanks for the comments. I appreciate the info on lighting and your thoughts on pricing. I will take them into consideration and go from there (although I didn't understand what you were saying Patryck- due to the grammar).

j razz
Steve Mann wrote on 8/7/2008, 9:09 PM
R800 - we're talking about the South African Rand? That's only $105 US. I can't justify the cost of gas for that amount let alone setup, shoot, strike, edit and deliver the commercial.
Butch Moore wrote on 8/7/2008, 10:28 PM
Before everyone thinks my $500 per commercial rate is ridiculous, there's several other points to consider.

First, we usually shoot more than one commercial per shoot. Yesterday, our full-time cameraman spent 1 hour on location at a local furniture store. I put together 3 comercials this afternoon in 3 hours, put them up on the net for approval, and will probably print to tape and ship them out in the morning.

Second, this is not incredibly creative work. The quality is good, but for $500...they do not get Star Wars. Besides, they can get an inferior product from the cable company's production people for just slightly more. Here are a few $500 examples:

http://www.ricevideo.com/honda.html
http://www.ricevideo.com/prtc2.html
http://www.ricevideo.com/badcock1.html
http://www.ricevideo.com/dazzle.html

Third, commercials are kinda my thing. I've been a broadcaster since 1973. I've written and produced literally thousands of radio and TV commercials. I dream :30 second dreams. Our customers know that I know what they want.

Fourth, our business model is probably different than most. We are in a very small market and have been doing this since 1994. We've survived with 3 full-time and 4 part-time employees. We've accomplished this through diversity and putting out "lots" of quality, affordable work. Quite a few competitors have come and gone, but we stay consistantly busy.

Finally, we still work in SD. Although we're experimenting with HD, we're yet to have a customer request it. With thanks to Vegas, we've developed SD systems that work and we don't get bogged down in the latest, greatest technology.

We have never advertised, but have developed our "brand" in the community as the "go to" people. We use our web site primary as a way for customers to preview material.

I've found that when working with TV, radio and cable companies, profit is reciprocal. If I let them make money, they let me make money.

I know that our business model would certainly not be successful everywhere, but has worked well for us in this small community.

Hmmm....maybe I should go up on the price?
Rory Cooper wrote on 8/7/2008, 10:32 PM
R800 is purely an editing cost walking into a studio and edits no shooting, travelling grips, and rigging lighting etc

The days of big corporate ad agencies are numbered, you are now getting smaller 2 or 3 man ops shooting editing from start to finish
The guys that are skilled in all the aspects of advertising from graphics, to filming to editing are the guys that are doing well

Also I would rather be shooting documentaries about rare palms
Marojejya darianii , Prichardiopsis. Etc getting paid less but and i would be very very happy

I went to the island of Mauritius for three months to do a commissioned job and left 3 years later
During that time collected seeds from endangered palms and sent them to various people for free
Best job I ever had and didn’t make 1 cent “excluding the first original job”

I love filming and editing it’s a balance of living and the reward of doing what I love its not about money folks

Rory

Butch Moore wrote on 8/7/2008, 10:48 PM
Rory,

If you ever need a grip on an island excursion...let me know.
Rory Cooper wrote on 8/7/2008, 11:28 PM
You bet

Actually on that island there is a palm only one left in the world Hyophorbe amaricaulis now this species you need a male and female to produce viable seed
I looked for this one for a whole year at Pamplemouse bott gardens everywhere even inside the volcano at Chamerell not one person knew what I was on about
Except one day an old drunk guy drinking his daily numb juice at a place called Redit took me to it,

Sad sad sad

How many more pop rivets are we going to pull out before the whole plane goes down
richard-courtney wrote on 8/8/2008, 3:43 PM
butchmoore:

I thought the car wash spot is a perfect example of low cost and fits jrazz'
situation.

The audio could be straight from the radio version (perhaps it has VO saying
"5 locations in.....").

No special lighting except I expect a couple of reflectors to bring daylight into
the wash bay. One person, camera and tripod. Back in office little time to
create particle background and customer logo.

Four hours at $120 per (twice jrazz' quoted price) still a $500 job well done.