The Real Costs of Quality Video

Wistia recently released a set of three videos to promote Soapbox, a tool that makes it easy to record, edit and share video presentations. They used the opportunity to explore why professional marketing videos cost what they do, and whether the cost is worth it.

The gimmick at the heart of their campaign was simple: They hired Sandwich Video, who do great work (personal favorite: Push for Pizza) and asked them to make three ads at different price points: a $1k version, a $10k version, and a $100k version.

That’s a pretty interesting thought experiment. One of the first questions we regularly get from potential clients is, “How much does a video cost?” It’s like asking, “How much does a house cost?” There are so many custom factors that there is no definitive answer.

So on the one hand, we think this is an fun approach to educational content. But if you’re looking at this Wistia campaign as a good way to understand why different levels of video production cost what they do, and what the right investment is for your brand, you’re going to be grossly misinformed. The gimmick is clever, but does not reflect the real world. Since we care deeply both about giving clients the best work possible for their investment, and seeing creative professionals get due respect and compensation for their work, we’d like to take our own pass at explaining why video costs what it costs, and why we think Wistia got it wrong.

All three ads seem to respond to the same brief, with similar execution: Scripted, live-action content, with some on-screen graphic elements, and a soft comedy touch. Out of the gate, this presents a problem for the experiment. That approach requires a certain level of professional talent on both sides of the camera or will make your brand look cheap and amateurish. When our client’s budget is limited, we discourage this approach. But Sandwich took that approach. Which to be fair, is what they do well.

On the low end, Wistia and Sandwich present a “$1,000 Ad.” The only way this budget can exist is if you don’t add up all the costs — like pretending a car only costs as much as a lease payment. It ignores gas, insurance, etc. You may be able to trick yourself into believing this is a real budget number if you have a staff with the skills, tools and time to make a video like this. But you likely aren’t accounting for all the indirect costs across the entire project. And creatives capable of this quality of $1k video will quickly find better professional opportunities than making this kind of content.

On the high end is the “$100,000 Ad.” The execution for this budget looks reasonable to us. But maybe unsurprisingly because Wistia is marketing a no-cost video tool, this version plays like a waste of money. It’s bloated with glossier production values than the story or product need. It trades effective 2D graphics with unnecessarily complex 3D animations. They even replaced their director/on-screen host with a Hollywood version of himself just to show that they spent more money. It’s debatable whether it was an upgrade. So they made their point — it’s possible to spend more money than necessary by putting it into the wrong resources. Which is not to say different creative could have cost $100k (or $200k for that matter) and been worth it.

That leaves us with the “$10,000 Ad.” Read the comments on their site and you’ll see that many found this to be the best of the three. We completely agree. It’s funny and charming, it explains the product well, it’s entertaining, and the production values and performances are more than good enough. But this is not a $10k video. Here’s why:

Based on the details Wistia and Sandwich have shared and our professional experience, we broke down the hours of labor and production costs for making “The $10k Ad” and came up with this:

Labor:

  • Scripting and creative concepting: 30 hours
  • Producer pre-production: 20 hours
  • Film crew of 5 (Director, Producer, DP, Sound, Gaffer, PA): 10 hours x 5 people
  • Principal cast of 3: 10 hours x 3 people
  • Supporting cast of 8: 4 hours x 8 people
  • Editor: 50 Hours
  • Director Post supervision: 20 hours
  • Producer Post supervision and wrap: 35 hours
  • Colorist: 3 hours
  • Audio Mix: 3 hours

Direct costs:

  • Canon C300 and lens rentals: $1000
  • Lighting Rentals: $1000
  • Audio Rentals: $250
  • Post suite Rental: $2000
  • Music license: $500

Overhead:

  • Rent, insurance, internet, and operating costs: $1500

Total Labor Hours: 273

Total Direct Costs: $4750

Total Overhead: $1500

Deduct the direct costs and overhead from $10k, and you have $3750 left.

$3750 / 273 Total Hours of Labor = $13.74/hr average pay. Minimum wage in Los Angeles, where Sandwich is based, is $12/hr. The average McDonalds assistant manager makes more. We doubt that math would make Sandwich Video a viable business. If you want to know for sure, we encourage you to ask them: inquire@sandwich.co

Also, professional production crew and talent generally don’t work hourly, they work on a day rate. This makes sense because it’s almost impossible for most of them to shoot for different clients on the same day, and their agreements always include the number of hours included in their day, and overtime is expected. We think that’s fair — these creatives work hard, are essential to the project’s success, and deserve fair compensation.

But the real devil is in the details, some of which we have thanks to the comments on Wistia’s blog and more of which may come forward in the web series about the making of these ads they are promising to release later. There are two big ones that are essential to understanding why this premise is misleading:

  1. These are not three videos at three price points. This is one “$111k” campaign. We’re privy to some insight from the Sandwich team about this, and they would never have taken on the $1k or $10k version alone. It was only a consideration as part of a package with a bigger budget. So in this case, the $10k version cost more than $100k. The $1k and $10k price points do not really exist. Not for Sandwich, and not for most serious, sustainable video agencies.
  2. Phil Nottingham, who works for Wistia, admitted in a comment (screenshot below) that these are only production budgets, meaning the cost of the crew and the equipment for filming. As we understand Wistia’s comments, these budgets do not include creative concepting, scripting, on camera talent, editing, motion graphics, music licensing, or finishing. You don’t have a video at all without those things, especially good creative and scripting. Honestly, there are probably hundreds of companies out there who can match the production values Sandwich brought to these pieces. But there is a much shorter list of agencies that can match their creative. And let’s not overlook the value of Adam Lisagor, a recognizable, valuable on-screen talent. Without him, you’re not getting these exact videos. And he’s unique. So no video at any price point is the same as an Adam Lisagor video. Recognizable talent can really create value and the market pays well for that. Much more than $10k in many instances. The price points presented do not reflect the true costs of hiring Sandwich or on camera talent like Adam.

So what should the $10k video really cost? If you want Adam and his creative, you’ll have to ask him. But if you want a similar quality of creative and execution, not including web-celeb on-camera talent, we estimate a real cost of $50–90k, depending on variables like talent, locations, and art direction. With a reasonable budget like that, most capable video agencies would cover expenses, feel valued as professionals (which is a GREAT way to get the best work out of people), and deliver content that met the client’s need for far less than Wistia truly paid for this campaign.

If you came to my agency with a smaller budget than that, and we liked the idea of working with you, we’d pitch you ideas to make the best use of your resources. If you came to us and had more, you better believe we’d do our best to put every dollar on the screen in ways that benefited you. We wouldn’t play the games they played with the “$100k” video here.

Wistia’s campaign is unquestionably provocative. It may even have drawn more attention to their content, though in a way that distracts from Soapbox, so we think it misses the mark. One of our big questions is if Soapbox is such a great inexpensive way to make a video, why wasn’t that the $1k Ad? That might actually make it achievable. Instead, Wistia tried to position themselves as experts with wildly inaccurate information (unless you also read pages of comments, or wait for that web series they’ve promised.) It’s stirred discussion, but we struggle to see how it’s good for their brand or product, unless they want to argue that all attention is good attention. In which case, maybe Kendall Jenner should stop an angry protest with a Soapbox video in their next campaign. But if they called us, we wouldn’t recommend that.

Bottom line: Clients who invest in content deserve a better accounting of what good work costs. And creative professionals deserve a better representation of why they charge what they do. At our shop, we’ll keep being realistic about what it takes to do good work, make the best of client resources, and educate clients about the process — all while advocating for fair pay for all contributors.

We think that’s a better use of time and money than gimmicks and stunts. And it’s a conversation that we’d be happy to have with you about your video needs anytime.

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Alex Beckstead

Alex Beckstead

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Creative Director and Partner at 4SP Creative. Too many ideas not to share some here.