The high prices are commonly attributed to “editing / post production time or huge equipment costs”. However, delving into the life cycle and evolving nature of photo and video businesses reveals a deeper truth. To answer why videographers and photographers are so expensive, we must first understand the freelancer mentality. This will eventually shed light on a complex industry; but first, we start with the independent videographer / photographer.
An industry of freelancers; hobbyists, students, creatives
Freelancers typically start for all the wrong reasons: themselves. A common back-story among photographers is using a camera and falling in love with it; henceforth, they pursue a goal of becoming a self-sustaining artist doing what they love. For videographers, we see dreams of grandeur; hoping to produce movies or make their way to Hollywood. Cleverly, these freelancers focus on high-quality work, but not to the benefit of customers. These artists produce primarily for name recognition, permanently working to build their portfolio. They are not serious service providers.
Side note. We are frequently approached by businesses who previously hired a cheap freelance videographer, only to end up with a video that is “too artistic” and is completely unmarketable. Unfortunately, portfolio builders tend to ignore client goals or directives.
Regardless of how a person gets into it, to market themselves going forward “as an artist”, they need a portfolio. It’s hard though (if not impossible) to sell photography or videography without examples. So, many freelancers may start by deeply discounting their service. After a few examples, they’ll set a seemingly decent price and move on without much thought.
Weddings inspire a false sense of hope and security
Most freelancers aren’t able to support themselves at this stage. However, in pursuit of larger end-goals, many will work an unrelated full or part-time job to subsidize their operations. Typically resulting in freelancers working nights / weekends.
Coincidentally, weddings are on nights and weekends. This is a boon for full-time professionals, as they are quickly booked up, with their choice in clients. But, with such a large surplus of demand, customers must turn to freelance providers, feeding them false hope and security. This surplus demand for wedding photography and videography is a major catalyst, and is feverishly gobbled up among hundreds of hungry freelancers. This frenzy inevitably prompts more and more freelancers to quit their primary job, and enter an extremely over saturated market.
It may help to know that in your typical US metropolitan area, there are tens of thousands of weddings per year. This makes wedding videography and wedding photography both a feasible freelance / hobbyist activity, as well as a serious business niche. City search results will net you hundreds if not thousands of video & photo freelancers for a single metro. It’s worth mentioning that while freelancers may be good artists, they are terrible businessmen. Leading to a whole slew of problems when offering a service.
Order volume creates price uncertainty
It can be argued that the price customers pay (at minimum) is the total cost of business, divided by the total number of sales. For example, if a business has $10,000 a year in costs and the number of sales possible is 1,000 units, each unit would cost $10. Of course, the real economics are many times more complicated than this. Other considerations need to be made; customers may or may not be willing to spend $10, the business may not know its cost of operations, or the number of units it can sell beforehand.
The risks extend well beyond these variables, but uncertainty in total cost and number of units sold in particular are of greater concern for videographers and photographers.
Assuming a modest average income at approximately $30,000 across the US, basic math tells us an independent videographer / photographer surviving on weddings alone would need to sell about 40 weddings at $750 each. Some wedding videographers and photographers get close to this price range, but we need to consider other factors.
Considering Travel, Equipment, Marketing, Materials and other business costs, we should approximate a much higher cost, perhaps closer to $60,000. We should also note that these freelancers can only service weddings 3 days a week (typically Friday, Saturday, and Sunday) over 52 weeks a year. However, it is highly unlikely that a photographer or videographer will work every single Friday, Saturday, and Sunday for a year straight.
A more practical approach would be allowing $60,000 for total operation costs, and selling between 30 or 20 weddings a year. This gives us a price range from $2,000 – $3,000. This price-point is also quite common in the industry. If photographers and videographers were, however, able to sell 150+ weddings a year, we would see more pricing at the $400 mark.
Somewhere in this calculation we arrive at more certain numbers, but one of the largest factors for photographers and videographers when determining rates is / should be how much of their time they can (or are willing to) actively sell. As we can see in the previous $60,000 example, there is an enormous difference between 20 and 30 weddings per year; those extra 10 weddings significantly decrease the cost per customer, by $1,000!
Uncertainty encourages significantly higher pricing
Generally, any uncertainty in underlying business metrics results in poor pricing and dramatic events as an end result. Going out of business is common among videographers due to inadequate sales and high pricing. Similarly, shortages and unavailability become common thanks to low pricing and the failure to match supply to demand appropriately. We tend to see a lot of volatility in the photo & video production market business freelancers fail to do any market analysis and completely ignore business insights.
Basic analytics goes far beyond providing a competitive edge; only the proper study of market data can accurately answer the most basic questions about pricing, operating costs, and consumer demand at said price-points. Additionally, so many entrants in videography / photography misappropriate their time and fail to factor in overhead, billing, customer service, marketing. Freelancers tend to severely underestimate costs at first, eventually correcting their errors with significantly higher pricing. Those who raise prices (and are able to sustain cash flow) turn into photo & video boutiques with fewer customers.
Boutiques are in the price range of $2,500 – $4,500 and have less to do with quality, and more to do with infrequent sales. In photography and videography, you don’t necessarily always “get what you pay for”, only samples can adequately showcase what you’re paying for. The industry, in its sad current state, is truly a mess–lacking any consistency or sensibility.
Matching services resell less talented, lower grade freelancers
The lesser freelancers who cannot justify premium pricing, are relegated to matching services. We call these companies “matching services” simply because they outsource the actual videography and photography to freelancers. Typically, these are nationwide re-sellers, usually existing solely online, may have a central editing studio / customer service somewhere, and perform cookie-cutter work.
The videographer or photographer who fails to market themselves in their first year of full-time work end up partnering with these freelance matching agencies. These freelancers turn themselves into contract, “part-time” workers where post-production, marketing, customer relations, and all editing is centralized at the matching service’s office. This version of photo & video businesses makes it so two separate entities fulfill your project; the freelancer that shoots it, and the matching service that handles the rest.
The majority of these matching services (for weddings) are within the price ranges of $1,200 – $1,900, and pay the videographer / photographer about 15-20% of the total cost. Because these services primarily use infrequently working freelancers, they tend to suffer serious quality control issues and focus on post-production editing for correction.
Boutique videographers & photographers offer even worse service
Customers often associate boutiques with superior attention to detail and a higher quality product because of their higher prices. In more extreme cases, uneducated customers buy into aesthetics, close relationships, and the quaint inefficiencies of these boutiques. While it’s true relationships are very powerful persuasion tools in winning customer business, it is far from true that boutiques are any better at providing service than a freelancer or more institution business.
The truth is, boutiques and freelancers are poorly unorganized and ill-equipped to handle the variety of expertise modern business demands. Social media and marketing are two common areas small businesses struggle with, and few actually overcome. Where the boutiques are truly lacking is in customer service and responsiveness to their customer needs. The boutique videographer or photographer is exactly that–they are designed for few and far between customers. The boutique limitations are further amplified by increasing customer interactions in a more connected world.
Marketing in particular, as we mentioned before, inevitably plays an important role in determining price. With fewer customers, boutiques tend to make less and less sales. With fewer customers to spread large costs, boutiques continue to raise prices. We’ve seen some photography and videography providers approach $10,000 for a single day of work. Again, this has little do with quality and more to do with only being able to sell 4-6 weddings.
False anchoring creates a huge amount of confusion
Since photography or videography is a secondary source of income, freelancers can afford to subsidize most or all of their activity. This tends to result in a lot of extremely cheap wedding packages that may be initially anchoring consumers to lower price points.
Likewise, the boutique photographer / videographer takes the opposite approach by covering their full costs over fewer and fewer customers. This creates a trend for significantly higher pricing, many of whom justify it by slapping a “cinematography” or “vintage” label on top.
When first shopping, many customers are “anchored” by two vastly different starting prices. There is the ultra high-end (over $3,000) and the absurdly low-end (under $600). The middle ground is dominated significantly by the matching services.
Higher prices do not necessarily reflect higher-quality work. The work is done by novices at best, regardless of which price-point you’re in:
Low-price work is performed by NEW market entrants,
Mid-price work is performed by 1-2 year novices (with better customer service),
High-price boutiques are run by 1-2 year indie artists
We’re instead seeing a fierce amount of competition, pushing veterans out of the professional photo and video business–ushering in waves of students and hobbyists. My best advice is to shop by samples, not price. Currently, pricing is a complete mess.
Volatility thanks to cheap DSLR; disruption by internet
Seasoned professionals are leaving the field thanks to accelerating competition. We can already see the videography & photography markets emerging as an unsettled, wide-open West. The increase in competition is mostly thanks to ever decreasing CMOS sensor costs and the rise of DSLR cameras. Students, hobbyists, and indie artists are now able to pick up a full photography / videography outfit for about $1,000 and start selling their service with their own website in about 5 minutes.
From another angle, we have an onslaught of innovation by America’s start-up race to create the next “big thing”. Matching services aren’t particularly new (they are at least thirty or more years old), but they are being creating at an ever faster rate.
Special side note. Matching services leverage freelancers’ willingness to perform work at fixed or low costs in order to build their portfolios. It’s hard to predict, but the future will either be dominated by matching services leveraging freelancers, or larger videography houses that provide services beyond those of boutiques and freelancers.
Remember: Services are more expensive than products
The key difference between products and services is the effective use of human labor. Products overall tend to be manufactured with a greater efficiency, resulting in lower prices. In other words, multiple products are typically manufactured per employee.
The cost of labor is high. Labor is typically one of the top costs in running any sort of business. The consumer carries the full burden of the serviceman, along with all other business costs.
The division of labor is low. By contrast, products tend to leverage enormous efficiency with the aid of machines and computers. Photography and videography are inherently different and suffer from one-to-one service pricing. There must be a videographer or photographer to perform the work (until robots are sufficient, at least).
Conclusion: Why are Videography / Photography so expensive?
They are expensive because too few people purchase them. There isn’t enough consumer demand to move prices consistently below $600 (except for freelance matching services). If more people purchased videography and photography throughout the year, or outside of Friday, Saturday, and Sunday–photographers / videographers could lower prices.
The simple facts are that most events happen on weekends, and there are only 4-5 weekends in a month. Many of these weekends overlap holidays, which are either reserved or extremely popular. Photographers and videographer can only sell a limited number of days throughout the year. Costs need to be covered, and high prices are the result.
Videographers and photographers who are lower priced tend to do more work, and may actually be more skills (practice makes perfect) than their more expensive counterparts; keep in mind that different levels of service make this difficult to measure more conclusively.
Bonus: Why do wedding videographer and wedding photographer packages force people to buy 6-8 hours?
Wedding photographers and videographers can only sell a fraction of their time throughout the entire year and still need to cover their entire yearly costs. For weddings in particular, there are only about 104 Fridays and Saturdays throughout the year. Many of said Fridays and Saturdays fall on holiday weekends which are extremely busy or extremely vacant.
This uncertainty means that photographers and videographers can realistically only sell about 80 weddings at most a year. To make $60,000 (an average US salary is $30,000) and cover travel, marketing, equipment, legal, materials, and other business costs, they would need to sell 80 weddings at $750 each to break even.
Many videographers and photographers are unable to sell 80 weddings. A more reasonable number may be closer to 30-20 weddings a year; respectively resulting in $2,000 – $3,000 packages. It is generally easier for photographers / videographers to charge more per client and take fewer clients, than to take more clients and charge less per client.