2024 How To Price Videography Services- Master Filmmaker

What's going on, guys? In this video I talk about mindset pricing, how to price yourself effectively and how to get out of a technician mindset and more into a business owner mindset. And if you don't know me, my name is Eric Deere and I've coached over 412 video business owners one to one in our program here at Master Filmmaker. And I'm making these videos so you can get value from them for free and you can scale your video business as well. So without further ado, let's dive into the coaching call.

Honestly, I was kind of just more here. I, um, kind of just as like kind of listening in and seeing if there are any, like, any, any little bits of, you know, knowledge that I could glean here and there from other people's coaching. But I did have one question that I was thinking about asking after you kind of talked a little bit at the beginning of the call when I jumped on, you were just talking about pricing. So I'm currently in the process of. Well, I'm not thinking about. I'm on the cusp of redoing our non, like you guys pricing because we've done our pricing with you guys, but that's very disconnected from like the rest of our pricing that we're kind of doing for other clients and so on and so forth. And I, in the past, historically, the way I've done it, which worked in that capacity, but just because. And the reason we're thinking about redoing pricing is just, I think we've grown a lot in both our capacities and our technical abilities in the video realm. And I just don't think that our current rates are necessarily serving that in the past. The way that we've done it is I've just essentially like done like an audit of like fiverr or not fiverr upwork. So essentially went around and found like what other video professionals are charging on upwork and kind of just based off of like where we fit, like what they offer and how we do and those kinds of things. That's really how I've based my pricing. So essentially I was like, okay, like these guys are offering similar to what we're doing. These guys are kind of in the same realm as we are. These guys do this, but it's like they're like way far above where we're at with this stuff and you know, and then just kind of based our prices very sort of subjectively off of that, which, like I said, it worked because it got us to where we are now. But I'm kind of like, you know, and my wife and I were talking about it and she's kind of person who's a little bit more of like the business side of things too. And she's like, I don't know if this is really a good way of doing a pricing because in some ways like she was saying that and I don't know, upwork. I don't know these platforms, like they kind of tend to price down on those platforms because they're kind of trying to there. It's like a bidding thing. It's like a bidding war kind of deal. So anyways, all that to be said, my, my question was like if you have any suggestions of instead of doing that or in addition or whatever, how to go about repricing services, that's both fair and also is, you know, profitable and so on.

For sure.

Yeah.

And I have a lot of thoughts on that. So the way how do you have it priced right now and who is it for? Who's the. Is it just for any company that wants to hire you for video? Is it for.

Yeah, so I mean really like it's, it would have very little thought to it. So like there's not like. And that's honestly one of the other reasons why like we're repricing is because we've done a lot more thinking about who we're for, what we're doing and what the value is that we offer. So we actually have a lot more value that's built into our services as of last year than when we did the pricing audit like two years ago and like actually set our prices right before then it was literally just like, okay, well anybody who wants us to hire us to do video production is, you know, we'll do, we'll serve, yeah, 100%. So that's where it's priced. That's where it's priced now. It's just a very generic.

And is it more like when you say so. Because there's a couple factors that are going to influence pricing. Number one, are you a, are you. Is it more of a gig worker type pricing where you're a freelancer to another production company or a freelancer to a large corporation that's going to be more of a. You have to have a market rate and you're kind of capped there. That's the first problem. So like you're capped if you do that. Number two, where you have more flexibility, which is what we try to do here is when you have, when you're a business offering A service to another business. And you have a unique mechanism or like a unique thing. Because when you have that unique thing, you're able to charge a lot higher above market value. Because it's a unique thing, right? It's a mechanism. Whereas, like, when you're just day labor and you're just a technician, you really, you cap out at whatever your area markets at, which is why you see people are like, oh, you can't charge that in California. You can't charge that in Omaha. You can't charge that here. It's because they're capped at a certain rate because all they're doing is. They're just. They're like a DP that's getting hired for the day or they're like an editor. Like what. Where you have more flexibility is when you become a. A business owner with a solution with specific expertise where you can actually charge a lot higher above market value because you have the unique mechanism. Like take Reed, for example. Like, he, he's done, you know, he's had 10 million views on documentaries. That's his specialty. Now am I going to. If reed charges me 75k for a brand video and then I have another guy who's going to charge me 10k, the number one thing I'm going to look at is, well, Reid has 10 million views on his documentaries. He has an expertise that's his unique. He has some sort of unique mechanism that allows him to charge that much money. Right? Whereas it's. Instead of looking and comparing at other people, I can't compare Reid to anybody because no one else has the same expertise or unique mechanism as him.

Right? Okay. So. So it almost would be contingent on the industry that it does.

That's why niching is important or either niching in the market or the method. Because, like, let's say you serve businesses in general. That's cool. But like, let's say you're like Reid and maybe you have like a specific documentary, you know, style or, or method. You call it, like docu style videos that helps any business skyrocket their growth and make more money. You see how, like, when you're a business, you're providing an outcome. When you're a freelancer, you are providing just simply a commoditized service and it takes you from commodity to. To. It takes you from commodity to more of category of one. Or like, like, if I, if I have this unique thing you've never heard of before, how are you gonna, how are you gonna compare me to other prices? You can't, because You.

Right, right.

That's kind of the psychological part of it, if that makes sense.

Yeah, totally. I mean that totally makes sense. Yeah, no, and that makes sense. So, because, and the issue, one of the issues is like that currently, like we've been, you know, we've been, we've been pretty much a freelancer for the companies who we are. And we're niching down in one. Right. We're niching down in MSP managed service provider. It's a little bit convoluted. This is the, this is the hard part about this is because like we're coming from a place of really being. My wife always used to call me like the digital digital handyman. Essentially, like where it's like if they needed whatever that digital thing was, we just kind of did it, you know, like, you know, whether that was video or, you know, design or web design or web back end, it was like I could do kind of that a little bit, you know. But now we're niching down in first of all MSPs, which is one of our main clients. Right. So that's easier. Right. Because we're kind of doing that. But then we have these other clients who are either starting retain. Starting relationships with or we, or we have a relationship with them which is still kind of in that digital handyman. And we're kind of trying to move into this new world of where we're a little bit less of a digital handyman and we're more specialized. Yeah.

You almost want to think of yourself as, hey, I am a business that provides a unique solution. I'm not a freelancer that does a job identity switch. I am a.

And that's hard because in, in a lot of ways these guys still see us as, and in some ways we still function as a freelancer who does a job, you know. So I'm like, okay. And this is just sort of the struggle that I'm in, honestly.

It's an identity shift, man. And it's. They won't see you that way until you see yourself that way.

Right.

And so that's really. It comes from the root. But it's like I see these people complain about like if they're a freelancer getting paid net 60, like if I'm going to sign on, let's say I'm going to sign. Let's, let's say these MSPs have like, you know, they need a software or they go to like a SaaS company, they need to buy a software. Are they going to tell that software company they're going to pay them net 60. No, because the software company is like, no, we dictate our pricing, not you.

Right.

That's where if you can get yourself out of that freelancer mindset and into a business owner mindset, you dictate the pricing schedule. Because like I used to do the freelancer thing too. It's like net 30, net 60, whatever. Right. But it's like when you get into becoming a business that provides a solution, it's more a partnership than it is like their way above you and you're down here, right? It's like I'm a business providing a solution and you need us. Here's the terms, here's what we do and here's how it works, right.

And we're kind of in the process of working them in that direction. Right. So like we're starting to develop, you know, some processes and contracts and those kinds of things as opposed to it being kind of. Because they really trust us and they like us. But you know, it up until this point, a big part of that has been like I said, because we've been that digital handyman for them, just kind of like, you know, last minute jobs, you know, like anything that they needed. It was like, well, we can depend on those guys. And we're kind of like, well, we don't really want to be doing last minute, you know, throw together jobs forever. You know that.

And then it's also, it's just not pricing it based on like the hours that you work. It's pricing it based on the outcome or the deliverable that you're getting. So it's like package one is like video, video, video, video. Package two is like video, video, video, video. Instead of like what freelancers do is they invoice you for like, here's how much time I spent, here's my day rate. Here's the pre.

Right.

Here's the. So it's switching from that into the outcome. So it's outcome based pricing versus you know, just the specific line item based pricing. It's kind of like, it's same thing with like a SaaS company. Like when you buy a software, do they send you an invoice? It's like, here's, here's how much it is for our hosting software. Here's how much it is for our backend dev team. Here's how much like you wouldn't do that. You just, it's 29 bucks a month or it's like $5,000 a month or whatever the software.

Right, right.

Whatever it is One price, all inclusive. So that's where it's just that kind of shift. And instead of looking at what everyone else is doing, it's figuring out like what could a business realistically make from this? Like if I'm serving business, it's gonna. Why it's harder when you serve a ton of people because it's, it's, they don't all sell the same kind of thing. But like read it for example. Like this neurosurgeon could sell $50,000 surgeries. It could be like a hundred K. So if my video, if all it did was bring you one more customer, would it be worth it?

Right, right.

And that's more focused on the outcome.

You know, so, and that's, and that's how we, we can focus in the MSP world because they do have that, I mean they have know, 60, 70, 100 plus K a year deals with these companies where it's like if there is that one difference of that case study or that video makes, it's like that, is that okay, well now we can, we can charge pricing. The other companies, they're definitely more in like the sort of lower level that one company's coaching company that, you know, they do have $25,000 sales packages, you know, so I mean there are, there is some, you know, they're getting a little higher up there. We're working right now. There's actually a church here in Bend that is kind of a, we're working with them about possible retainer. And so I'm kind of, but I have no experience on the church realm whatsoever other than what we've done for them already. So I'm kind of like, I don't, I don't know what's, we can work.

With you on that obviously and help you figure that out. But I mean, what would they, what is the, what is the point of the package? Like what do they, what's the outcome they want from the content?

I think they're just wanting. And that's, that's kind of what we're going to be stepping into is like doing some discovery with them. Like we're, we did some really basic stuff for them that they love. Like they, we did social stuff, some social reels for them that they loved. And so we're coming into it very strong. Like they, you know, really liked what we've done. I think they're really just wanting to use stuff on social at their events and at their services, on their website. They're really just wanting to have someone who they go to as a relationship to produce content that they love. I don't know what their particular outcomes and like success metrics are exactly like, that's going to be part of our onboarding that we do starting next, like here in about a week and a half or so. But they've been happy so far. So what they want, there's kind of.

Three outcomes and they'll fall into one of these. But it's health, wealth or relationships for them. It's probably more relationship, relationship based. I want to bring more people in, I want to build relationships, I want to grow my community. And people find a lot of value in that. They're willing to pay for that. But those are the three. So it's when you're in these sales calls, it's figuring out like, do they want health, wealth or relationships?

Right. I mean, I can guarantee you it's relationships.

Yeah.

You know, they want, they want the relationships.

I mean, you find out what that is, you sell them on that during the call. Hey, this is going to help you bring in more people, empower your community, build you up and like, blah, blah, blah, whatever it may be. And then that's where you sell them in. The outcome now it's, it's much more lucrative. And those, those are great, those retainers are great with those types of people. It's, it's just you can charge usually a lot more money when you are based in a wealth outcome. So that's why just as a 30,000 view, look at like trying to help people who obviously, you know, are going to make more money from the content that you're, you're creating and then that's where you.

Right.

Clearly bring in more. So.

Right. And honestly, like, well, that's why we're going with the MSPs is the MSPs are definitely there.

You can find somebody like that. That's. Rich clients are better than poor clients, man. I'm telling you, it's easier. They're easier to work with. They have more money, they get results faster. It's just, it's, it's so interesting and it's so obvious too. But it's like, you know, companies doing $100 million a year, this is nothing for them. When it's someone who's really, you know, struggling. You know, a 40,000 package could be make or break. You know, it's just.

Right. Totally. And you don't want to be in there doing that. You don't want people relying on you as we're not a lifeline.

This is not. Yeah, yeah. 100%.

Right, right.

That's just kind of some psychological stuff around it. Hopefully that makes sense.

Yeah. So really, it's kind of continuing to make that shift. Trying to make the shift away from being the freelancer into being the service provider. The service provider, the business, and then charging accordingly to the outcomes that you're providing, not necessarily for your hours work.

No, because like, if. If I come in and create a piece of. If I create a piece of content that you run as an ad, for example, that makes you a million dollars, but it only took me two hours to make it. Should I be billing you based on the hours or based on the money that I made you?

The money that. I mean, you should theoretically be billing me on the money that you made. You should be billing me however you agreed to in the beginning.

Yeah, that's what I'm saying is like, they're paying you for your experience and your knowledge and your unique mechanism, quote, unquote. Like, they're paying for that mechanism. They're paying for your experience. They're paying for the. The business experience, the business's mechanism. They're paying for the solution.

They're not.

It doesn't matter how many hours it took me to put it together. So that's why I wouldn't even talk about it.

It doesn't matter.

It's not relevant.

Okay.

You know.

Okay, so just kind of trying to continue to. That's your kind of advice, is just trying to continue to move, make that mental shift and what are the key.

Yeah, so, like, what are the key videos that are going to help them hit the outcomes that they want? Let's talk about creating. Creating those videos for them to help them get to the outcome they said they wanted. That's it.

Okay. Okay. All right. Well, thank you. I appreciate that. I'm actually sitting down tomorrow to start conceptualizing all these new retainers and all these new ideas because it's kind of interesting. All of my clients have come to a point where things are shifting and we're kind of revisiting contracts and that kind of stuff, which I think is good. I'm not. I'm trying to do my best to incorporate sort of like mindsets and those kinds of shifts that were.

And then on a more tangible level, 80% growth, gross profit on your packages is what you want to shoot for. So after labor. Labor being the 20%, you want to shoot for 80% gross minimum. Because when you start to. Yeah, yes, exactly. So, like, I know your.

Your eyes are getting big. You're like oh, that's just mind blowing to me, you know?

Well, because think about it. When you have cost per acquisition, if you run ads, ads might take up 10 to 15%. On top of that, you might have a salesperson that you pay 10% commission to close the deal for you, right? But to fulfill on, it should take 20% of the contract. And if you could be at 80%, you give yourself a ton of room to scale. Because as you scale, things get less efficient. You have to hire more people. People are not as efficient as you when you hire them. So you have to, you have to keep in mind, like operational drag. When you have people working for you and you, like, your, Your margin starts to shrink as you grow anyways. And that's very normal. But starting at 80% gross profit, like if I, you know, I buy a video from you, it's $10,000. It should only cost you $2,000 to make that video.

I'm just using simple numbers for your time, right? Essentially, if you fill out your time, you should be.

Not even time. Just like if, yeah, like if I was going to hire. So, like, all the jobs you do in the content, like pretend you had to hire somebody for that. Make a list of everything you'd pay them for. Pretend like you, you know, pretend like you can't fulfill on it at all. And then build out how much that costs. It should not be more than 20% of the total value.

Okay? So essentially calculate out if some. If I was paying someone else to do it, and then there.

You're not allowed. Like, this is a fun exercise. Like, you're not allowed to work on it. So pretend they just bought it from you. You're not allowed. I, you know, your hands are tied. You can't do anything. It's. I have to hire an editor, a shooter, maybe an account manager to communicate with them. And the reason I do this is because, like, in the beginning you're going to do those things, but at scale you can't.

You're not.

Like, take this program, for example, as like an easy example.

Like we have.

We've had 400 people go through this program. I can't fulfill on that. Like, that's not for just me. I have to have a full team. So I have to pay my team. Obviously, I have to figure out how much each person makes. So then at scale, I'm prepping you for that. So then in the beginning, you're gonna have a lot more money. You're like, yeah, this is great. You're gonna, you know, take the money and put in your bank account. But that's like your rainy day fund for as you start to grow and you have to start paying people to do jobs, like more people than what you're already paying.

Yeah, okay, 80%, that definitely makes sense.

Yeah, I just, I always err on the safe side. If you can get to 75, that's okay too. But really you want to shoot for 80% because you're going to have costs outside of just the fulfillment. It's going to be marketing, it's going to be sales. And that doesn't factor into the 80 from there.

Right, right. I think that's definitely an area we've struggled is because you know, we have enough to live on, enough to sort of fill on the thing. But like when those extra ancillary costs, there's just not a lot, there's not.

A lot too, man. It's like when you're. I've seen this in my own life, in my clients lives, in my team members life when they start making a lot of money too. You humans fundamentally won't make more money once they have enough to live on. Like there has to be a bigger reason why. So like you know, most people don't need more than 20k a month profit. Like you got 20, 20k a month, you're good. You have to find a reason to push further than that. And usually it's like the team members and whatnot. But like just because you have enough to live on does not mean you should not charge the price that you deserve to charge.

Right.

You know, it's really what it comes down to at the end of the day is that doesn't, it doesn't matter if that's enough for you to live on. Like if it's providing immense value to your clients, which it is, should charge accordingly. But that's also where having a unique mechanism is going to allow you to charge those higher prices where you have 80% gross profit.

Okay, okay.

Sorry to just. I threw a bunch at you there.

But no, it's all good. It's just honestly like sometimes it's kind of like I feel like it's like turning like the Titanic, you know, it's like you've got, it's like you're trying to like you're going along. Like in some ways I wish that I had built this like at the beginning, you know, as opposed to being, you know, a couple of years ago man. Now I know, like it's normal, but.

It'S little at a time. Right. So as you have these clients come up and start to reevaluate, work with us. Let's work on some updated pricing. I would just map out a cost of, like, how much is the project and then what are your actual expenses on it? And then see where your margins are right now. And then let's just. It's just as simple as increasing the price and then reducing your cost as much as you can to get to that. 80, 20.

Okay.

And then we can start bringing that to clients. And yes, some of them are not going to want to move forward, but, like, you can't. You don't want to be busy and broken. Not that you're broke or not that anyone's broke, but it's like you don't want to have a ton of clients where they're not paying you enough, because then you're just like. You end up hating them because it's like you end up resenting them because you're like, I'm not getting paid enough for this. Yeah, it's okay to let some of them go because you'll make a profit.

In the long run.

So.

Okay. All right, well, I think my first step is to kind of just revisit everything tomorrow. I kind of. I have it on my to do list to kind of just look in and just one of the.

One step at a time, revisit everything. Let's map out the cost and see where your margins are from there.

Okay. All right. That sounds good. Thanks, Eric. I appreciate it, man.

You got it, man. Absolutely. Let me know if you need anything else.

All right, sounds good.

Anything else I can help with, guys?

So that conversation kind of reminded me of something. Something I've been thinking about for a while. It's probably premature at this point, but. Yeah. So I have this co client that I. That I'm working with. I basically just do edits for them. They're a. A nonprofit.

Okay.

And they. Everything they do is in Africa as far as, like, all their filming. And they have people out there that film stuff. They have a hard drive of footage that I have access to, and they're like, hey, we want to make a video about this. And they send over the script. I edit it. I'm working on a project now. Probably not going to be finished until. Probably not till May because we got to get an animator and all that stuff. But my goal is, after this project, I want to pitch them and try to get them on a. Some sort of, like, larger package, larger retainer. I've been working with them since, like, the summer of last year. I've done a couple videos for them at this point. So I'd love to get, like, your idea on how to kind of approach that conversation. And I'll give you a little bit of background, because when I work with them, I feel like where I would fit in is like, I would just be, like the connecting glue because they're kind of all over the place. They'll have, like, these ideas for the videos, and then they'll, like, send me the script and, like, the footage and be like, we're ready to go. But then, like, they don't have the vo, and then I find out, oh, they don't have a VO artist. So, like, all right, I got you. I'll just go to my network, I'll get them a VO artist. Like, I recommended a VR artist for them. I recommended animated for them. Was like, all right, well, let me just do all this in house, where it's like, I'll give you X amount of videos per year, and I'll be responsible for, you know, everything from start to finish. So, like, you guys work on the script. They have a script writer that I actually work with to, like, work on the edits. I would just keep them on. They would write the scripts, they approve the script, and then I would facilitate the VR artist animators if we need IT editors and all that stuff for all the deals for the year. So I guess what would be the best way to kind of. Because, like, again, I'm in the same situation where I'm basically a freelancer for them.

Yeah.

And it's like I'm signing their contract, but, like, I want to flip the script. And it's like, all right, now you're saying, my contract. This is the price is what we're doing. How do I kind of put myself in that position, you know, after I deliver this last project?

I mean, exactly what you just said. It's the. It flips as soon as you say it does. Right. So you can. You can change who you decide to be. It sounds so woo woo as I'm saying this, but, like, you can. I should have some motivational music playing behind me or something. But it's like you can change who you are to them the minute you say you do. So you could say, hey, we're moving into a new. A new era of our business here. We're putting together comprehensive packages for our clients where we do everything, start to finish, as our company. Is that something that you guys might. Yeah, it's just. It really just kind of comes down to how you conduct yourself in the meeting too. Because it's like, it's kind of like if you let them take status frame on the call and tell you what to do, then they're going to look at you as a freelancer. You take status frame on the call, then you're, they're going to look up to you. Right. And it's like, it's very interesting the more we talk about it, but it's like you have a freelancer, you, you usually. And there's nothing wrong with this, but usually companies look down to a freelancer like an employee. Whereas when they're a business, they're at least looking at the same level or they're looking up to them. So even these little micro things we talk about within like status framing in the sales call is the same thing you can do here where like they need to see you at a higher level than you are right now. And that's why like freelancers kind of get the shaft a lot of times because they, you know, they just look at them as a freelancer like, I'm going to tell you what to do. I'm looking down on you. Whereas when you can be above them, at least at the same level or above, that's when things start to change a little bit. But you could just say we're, we're moving in a new era. We're working more with. You could just say like we're working more with clients on a retainer basis to help them with XYZ as a comprehensive solution which is going to help you benefit, benefit, benefit, whatever the, the main points are, which it sounds like they have a lot of pain points to where this could really help them.

All right.

Yeah, that's, that's my, I mean that sounds like a, like an excellent email to be sending over.

I would, I would honestly just say it on a call I try to avoid doing. Just say, hey, I have some updates for you. Would love to touch base. Let me know when you and insert other leadership team that's involved in decisions has some.

Okay.

And then I would do it on a call and say, hey, want to let you know that we're moving into this. You just put your stake in the ground. You're saying this is, this is what we do.

All right, cool.

Respect it, you know, so don't overthink it. Either you are who you say you are. The minute you say you are that person, you know, it's kind of like you are successful as soon as you decide you are I think a lot of us put these, like, weird. I do it myself, but it's like, we put these weird revenue. Like, oh, when I hit a million bucks, I'm gonna be successful, man. And then you just. You get there. I'll tell you from experience, you push it again. Oh, when I hit 100 million bucks, I'm gonna be successful, man. And it's like, you are successful. You are a business owner. You are the person you say you are. The minute you say you are, no one can decide that for you. That's your decision.

Cool. Anything else that hits, that hits.

I'm telling you, man.

That's a hard one that hits, though. I know.

I'm telling you, you guys got me in my mindset guru mood over here doing all my stuff. No, but it really is. It's just. It's a mindset thing, man. Like, I think a lot of people just get caught up on past things and, like, oh, you know, I can't be that person yet. So you could be that person immediately. You just have to decide. And then it goes back to the old thing we've been talking about today. But it's like, you will charge and you will get paid as much as you think you deserve to charge and get paid because people look to you on what they should pay you. So if you don't charge more, it's simply because you think you don't deserve to charge more, but you do. Within reason. You can't charge, like, you know, million bucks for a minute or something crazy. But, like, within reason.

That was going to be my new rate. I was going to be a million, dude.