Does hiring someone who works cheaper, or provides a service you need at a lower price, do the best work or provide the best service?
This question is asked by every business who struggles with establishing their product and services pricing model in a competitive market. Those businesses who go for the lowest bid work are starting to realize that going cheap can get you into deep trouble.
So why do businesses go for the Cheapest Bid?
Over the last ten years, businesses who accepted the lower proposed bids are far less satisfied with the outcome of the project than those who hire based on project needs.
Greed is what pushes many businesses to go for lower bids. Most bid proposals are based on an already preconceived budget that has been provided to the person or department that is requesting a proposal. Their motivation is based on coming under budget so they can pocket what they saved.
80% of the time the company who accepting the lower bid feels that coming in under budget on the project is more important than the project being successfully completed on or ahead of schedule?
In 40% of the cases we studied, the company accepting the lowest bid felt they had control over the market’s pricing for the particular service. Taking a lower bid would set a precedent for following proposals and announce to the market that this is what the requested services are worth.
In the world of video-centric digital marketing, pricing for a proposed project that is heavy with quality video production is guaranteed to appear to be expensive. Sure, there are thousands of different ways to get around the costs associated with producing videos. However, all thousand of the cuts made to the actual cost of producing videos result in a degradation of the quality of the videos….guaranteed.
How to determine the best pricing for video-centric digital marketing?
A business has to realize doing business cost money and the more money a business wants to make the more it is going to cost to make that amount of money. Today, if a business does not have a strong video-centric digital marketing strategy they are already behind in the race for consumers.
When asking for bids for digital marketing that includes videos it is best you look to what support is going to be offered for the videos that are going to be produced. What will the video do? Where will the video be placed so consumers will see it? and How will the video be sustained?
Video production groups today generally do not offer support for the videos they produce. There are still those production groups who just produce a video and generally will do a good job, but have no idea what to do with the video after it is produced. This sometimes works against the video-only production groups since they do not have experience in knowing what the video is going to be used for..they just shoot and deliver a video.
Video-Centric digital marketing agencies start off the entire process by developing a strategy based on how the video, or videos, will synchronize with the client’s business objectives. This can only be done when the video-centric digital marketing agency has someone on staff that is experienced in business marketing strategy.
If you put out an RFP (Request For Proposal) for video production and are provided a proposal that clearly outlines:
- what videos will be produced,
- where the videos will be placed to capture the most consumers views
- and offers a plan to sustain that strategy over a long period of time…
…then that would be the proposal a business should take..no matter what the proposed price.
Going for Cheap with anything that has to do with video production will win you friends in the boardroom but will always come back to bite you when ‘Going Cheap’ doesn’t produce anything.
Let me know how I can help.
Contact SyncLab Media to learn more about how a Digital Marketing Roadmap can help.
