HOW MUCH DOES IT COST TO MAKE A REALLY GOOD AD?

By - CTL
February 25, 2019
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By Mike Canavan, CEO BBS Australasia.

It seems everyone today is looking to get more blood out of the proverbial stone than ever before. The economic constraints placed on local offices are being squeezed tighter and tighter by their international head offices.

The most frequently asked question from all our clients is “how much is enough?” That is; what is needed (in money terms) to produce a decent well-made television commercial that fits the image and corporate imperatives of our brand?

This question is as old as the talkies themselves.

Unfortunately in all my years in this business,
I have never found one simple or easily articulated response that fits all; I suppose that is because each commercial is so different. Sure on paper, they might look the same but as time passes, the goalposts inevitably move. I think the quote “Oils aint Oils” from the famous Castrol oil tag is most apt.

There are however certain considerations that I believe may assist in steering you through this pre-production labyrinth.

Let’s for arguments sake pick a number. For the purpose of this exercise let’s target a budgeted brief of say $300,000.

The first question should be “Is this enough to produce the type of script that will fit my brand needs and standing in the marketplace?”

Generally speaking a wander back through the past years budgets can certainly be of assistance. Obviously you must take into consideration the following:

  • Is this a similar creative execution and storytelling to previous copy (or) have the goalposts moved so far as to make historical precedents irrelevant?

For the purpose of this exercise let us assume that the budget provided is adequate for the task at hand.

Given we are satisfied that this is all that the project warrants, and indeed can afford it, we can proceed to briefing our advertising agency, and requesting that they develop a new script for the current market needs and demands.

THE MAGICIAN’S OLDEST TRICK.

It is at this stage where the perennial wildcard is often thrown into the equation. It all starts with the way the agency briefs their chosen directors. These are the ones they feel are most able to provide the best treatment and execution with the approved script.

I would like to believe that it all starts with a level playing field, and all production companies are supplied with the same brief, however the selection of those asked to submit may be as different as chalk and cheese.

It’s the oldest of magic tricks; ‘Pick a card, any card’. The problem is you always end up with the card the magician wanted you to pick.

You might ask, just how could this happen? Like all card tricks they take a lot of practice, but once you’ve got the hang of it, it’s pretty easy to fool even the most skeptical of volunteers.

It’s usually done at the briefing stage. Three production companies will be selected to produce treatments, vision and budgets to bring the commercial to life. There are varying levels of production houses and possible directors.

If you go in at the top end of town you are sure to get a Rolls Royce price, but if you are on a Holden Commodore budget, it’s a bit like comparing apples and elephants.

If the budget is $300,000 and you brief the preferred bidder to this. Then you brief the next one who is guaranteed to come in at $400,000, and the next one at $550,000, your choice
in reality is one. The other two form what I suppose you could call ‘window dressing’. If ever challenged it’s easy enough to confirm three quotes were obtained, the best most affordable was recommended and selected; simple isn’t it? Now it’s fair to say that this does not happen every time nor with every agency.

It is true to say that the relationship that exists between most clients and their agencies hold different priorities. The agency is committed
to making beautiful commercials and as such believes that they truly know who is best to shoot and Direct their creative work. Their view is “this is why they are there”, and further to this “most marketers have very little knowledge of the creative process”. This in certain circumstances may be true, on the other side if you are a client who has worked in the business for many years and made lots of similar spots that have worked, it’s hard to understand how a new junior creative team assigned to this, their first project, is better equipped to handle the difficult task of selecting the right Director to shoot your commercial. Perhaps collaboration would be best and in a perfect would this would eliminate most conflicts, however we rarely live in the perfect world.

After all, this ad is the public face of your brand and it’s you the client who will have to live
with the results of this activity for the next possible two or three years. Given conflicts are bound to develop and we all share different opinions and views, greater understandings of both parties relative positions would go a long way to working towards achieving the best possible end results, and after all this should be everyone’s primary agenda.

I say all this to reiterate that the budget conjuring trick does not occur in every case or indeed every agency, the information above is provided for the benefit of understanding some of the pitfalls involved in the production process.

 

A FEW EXTRA BOB: (Dollars for the Millennials)

The other really tricky issue that many are confronted with is “look if we had an extra $30,000 or $40,000 we can get this guy and he will do a much better job than all the others that we’ve considered”, and he/she will better fulfill the brand imperatives.

It is impossible in my view to evaluate the real effect of this particular additional spend, as the investment has no guaranteed or quantifiable parameters to measure itself against.

On a budget of $300,000 the additional spend of $30 to $40,000 represents round about 10
to 12%. This would most likely provide an additional hour or two of crew time, possibly
a little more for the art department, with the balance spent in post-production, hardly enough to move the true look and feel of the final film.

Another thing to consider is; will this extra money get me a significantly better treatment, director or vision?

  • Will the film look 10% better, and how will I recognize the change?
  • What increase in sales might I expect from spending the additional money?
  • Will this extra spend impact on the delivery of my final film (to clarify this question, will there be a greater need / time required in the backend of the post production process)?
  • Will that extra 10% be the only additional cost that I might face, with the extra spend it may effect and could change the treatment, execution and look, thereby requiring further costs to the eventual delivered final film?

In my view this is most unlikely that this additional investment will really move mountains.

In the heady world of boffins and academics there naturally exists an academic formula, which those more cerebral types have proposed.

Economic theorists provide a concept known
as “pricing elasticity of demand”. It is generally considered a measure used to show the responsiveness or elasticity of the quantity demanded for a good or service to a change in its price. More precisely, it gives the percentage gain in quality demanded in response to one percent change in pricing brackets holding constant over all determinants of demand,
such as income.

It even has its own complex mathematical equation

%∆ in Qd

%∆ in price

Percentage change in quantity demanded Percentage change in price

I’m afraid this methodology is all Greek to me. It is, shall I say, well and fine in theory and
may indeed be the subject of great debate and importance in university lecture halls or tutorial groups, but in the real commercial world how it translates into the bottom line of the production of commercials in today’s market is anyone’s guess.

Naturally this would also need to provide a greater volume of sales. Measuring such a difference is impossible. To accurately do so one would need to produce both pieces of copy and run them in competition with each other at different times to see the variance.

Of course on a budget of $100,000, $30,000 represents a 30% plus injection of funds. This percentage should obviously have a dramatic impact on the production and the expectation of its eventual look and delivery.

Equally the question should be asked, if I spent $30,000 less, would it affect the overall look of my commercial.

The simple answer is yes. Below a certain level of spend, the look, execution and deliverables will be compromised. There are certain immovable costs associated with putting together a higher end production crew, and having the practitioner (director) who will guarantee a polished and professional result; whilst delivering a product that our brand can be satisfied with.

LEARNING

It is indeed one of the joys of this amorphous art. In general terms the most valuable advice I can offer is “You get what you pay for”.

 

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