Why You Should Share Your Creative Budgets with Vendors

Why You Should Share Your Creative Budgets with Vendors

Share on

Having existed in the video production industry for some time now, we’ve become brutally aware of one problem that exists in the quiet grumblings of creative vendors everywhere–clients’ unwillingness to expose their project budgets. Don’t think we don’t understand the clients’ point of view, we know that you’re worried about vendors taking you for all you’re worth. However, the reality is that creative vendors really don’t want to take advantage of you. In fact, we want to create for you the best possible product that your budget allows. The only goal you’re achieving by refusing to disclose your budget is creating more work for both you and your vendor.

The Sliding Scale

Imagine a graph with the Y-axis being budget and the X-axis being quality. Better yet, just look at our entirely unscientific scale below.


The scale isn’t perfect, but it shows you a very important factor in producing media content–the size of your budget and the quality of your final product are inextricably linked.

Before we explain why this scale matters when talking about disclosing budgets, let’s look at two examples. We’ll begin at the bottom of the scale with car dealership and lawyer commercials. There’s no data to back this up, but from experience we would guess the average cost to produce is around $5,000. On the other hand, the average cost to produce a nationally broadcast 30-second television commercial. According to a survey from the American Association of Advertising Agencies in 2011, it’s $354,000.

What does this have to do with clients divulging their budgets to vendors?

Knowing Where to Aim

If we don’t know your budgets, we don’t know where on the scale to aim–it’s really that simple. Whether your budget in $10,000 or $200,000, brainstorming ideas without a figure in mind is like throwing darts while blindfolded. The chances of vendors developing an idea that lands on your budget are equally as unlikely as hitting the bullseye of the dart board.

Why does this matter? It wastes time and time wastes money. You have to spend hours going back and forth with your vendor trying to land in the right place. Meanwhile, they have employees spending vast amounts of time developing ideas that you’ll reject entirely because of their cost to produce. In the end you’ll find yourself in one of two situations.

Two Outcomes

First, your creative vendor presents an idea that you love, but costs twice as much as you’re willing to spend. At this point, the vendor has to explain to you why the idea just really isn’t possible at your price point and then start over from square one.

Second, your vendor presents an idea that is far below your budget and you consider this a win, because you’re saving money. However, your wrong, because the sliding scale comes back into play. You’re now getting a product of inferior quality to what you could have created, which will generate less interest in your brand and sell fewer products.

Truthfully, there is a third outcome. It’s possible that your vendor presents an idea that fits perfectly into your budget and everybody lives happily ever after. However, this circumstance is highly unlikely.

Let’s Be Friends

What’s the moral of this story? Don’t be afraid to share your budgets; it makes everybody’s lives easier. It provides a roadmap for your vendors to develop an idea that fits within your budget and provides the greatest value to your brand. In the end, you’ll have a great product while saving money and time.


Video Industry

Share on

Read More Insights

©2021 Tubular Insights & Tubular Labs, Inc.