"Excuse me Sir. We have an opportunity for you. We are producing 2000 videos. Each video is around 2 hours long. They will be used for a YouTube learning series. Can you give me a price?” OK, so a 2-hour video is around 20,000 words. If you use $0.25 per word (bottom end of GVAA per word rate) that works out to $5K per video. 2000 videos at $5K is $10M. HOLY SHIT – I’M GONNA BE RICH! OK, I better make sure my calculations are right. Let’s use the GVAA per finished hour E-Learning rate. Bottom end is $1,500 per finished hour. For two hours that is $3K. With 2000 videos that is $6M. Not as much as $10M but - I’M GONNA BE RICH!
Would you be excited? This is a real-world example of a project email I was sent this week. Am I going to buy a yacht? I don’t think so. Client is in India. There is no way in hell they are going to accept either of my quotes. Should I reduce my rates to try and win the job? Hey, I could charge $200 per video. I would still earn $400K for the whole job. That’s a no-brainer, right? Slow down there just a little before you trade in the yacht for a boat. 2 hours of finished audio will take approximately 6 hours to create. 6 x 2000 = 12,000 hours. Let’s say you work on this full time at 8 hours per day, 5 days a week. 12,000/40 = 300 weeks = 6 years if you take 2 weeks off for vacation. $400K/6 years = $66.6K per year. Maybe just a dinghy then? Oh, and they want it done in 5 months….
It’s just numbers. Remember that. I did not have this job before I received the email. And yes, I probably won’t have this job after you read this blog. And that is the mindset that you need to get into as a Freelancer. Know your worth, set your rates and then stick to them. Send the quote and move on. It will make your life so much easier. How do you choose your rates? Well, that’s a bigger question that I don’t have time for today.
Things have changed. Don’t spend your time reminiscing on how commercial rates used to be so good that you could live for a year on one national spot. Media is consumed differently now. The ratings for a national spot are WAY less than they used to be. Let’s take the Simpsons as an example. In 2000, they had an average of 15 million viewers per episode. In 2019 it was down to 3 million. That is an 80% reduction! Common sense would follow that the rates for a TV spot shown during the commercial break would also drop 80%. Simple economics.
It’s not all bad news! Because media is being consumed differently, it has opened advertising to a whole new world. It is now affordable for a local business to target a certain region within a certain market for a price they can afford. Brands are now making numerous spots rather than one big expensive spot. On demand and streaming services are where the eyeballs are now. How many eyeballs? Unfortunately, we are all behind in trying to figure out what the rates should be for these spots and the reasoning behind it. Pre-roll, social media spots etc. etc. Times are a changin’. It has opened up the voiceover market so there are more opportunities. Conversely, each opportunity pays less.
So, know your worth. Do some math. What will you set your basic rate at? Once you decide that, the rest becomes easier. And stick to it (within reason). I have my BSF (basic studio fee) and YHAL (you’re having a laugh) fee. I always quote my BSF (we won’t discuss usage). If someone comes back with an offer lower than my YAHL fee then it’s “thanks for the opportunity and I hope you find someone to do it for you at that price”. They probably will and good for them. I just know I am worth more than that. And so should you. Now, I must go. Gotta meet a man about yacht……..