Making money with film or video always depends on the framework conditions that your business environment offers you. This article shows possible scenarios you may have to prepare for in the future.
You can’t swim without water. In the same way, it is not possible for you to travel professionally without being in a market. Even if you’re doing everything right, the evolution of a market can still screw you up big time. If you are a professional in the film business and want to make good money in the future, you need to think about where the journey can take you. This is just as true for free markets in which commissioned producers operate with real or fake commissioned productions as it is for the highly subsidized feature film business.
In this article, we show you four different scenarios that, alone or together, could shape the electronic media market in the future.
Making money with film or video: What does the future hold?
The series of articles on money and professions in film has 4 parts. They all deal with the question of how you can make good money in the film business in a fair way:
This fourth part of the series deals with the most difficult aspect of making money with video or film: the economic conditions that your environment forces upon you. Unlike the services you offer or competing with your competitors, you can only influence the rules of the game here to a very limited extent. It’s like swimming: You are always part of the water and exposed to its temperature or current.
What you’ve learned so far about making money as a smart person
In the first post, you learned that not every problem you can solve for your customer is actually their problem from the customer’s perspective. Your quality can be 100x better, if the client is happy with the existing quality of their videos (or lacks the budget to increase the quality) you can jump in the quad and you still won’t make any money.
Part 2 hopefully forced you to ask yourself more important questions. The most important of these: What can you do really well and what distinguishes you from your valued competitors? The answers will help you sharpen your alignment and positioning.
You want to make more money, you need new customers. The third article in the series describes ways to do this. Here you will learn why target groups are indispensable for your success, how to communicate where, what the yo-yo effect is for video producers and why you should always think in sequences (i.e. more than just one measure) in marketing.
Market changes: I’m helpless there anyway!
The first and most important message for you: Wrong! You can do something. Just because you’re swimming in the ocean and the current changes or the water temperature cools sensitively doesn’t mean you’re lost.
But only on one condition. You’ve prepared for change and have a plan for it. If you jumped headfirst into the water as a non-swimmer: Your fault!
It is part of your professional duties to prepare for anything you can think of and have a concept for it. And for what you can’t imagine, too.
For that, you need, one, a radar system. This way you can recognize developments at an early stage. A radar system can be conversations with others in the industry, membership in professional associations, interactions with your clients, and most importantly, the ability to constantly think about what is changing for you in your profession and why.
Second, you and your organization need the will to change. Many changes are recognized, but either they are so frightening or radical that they are denied instead of accepted.
Making good money is also dependent on where you are in the stream. If you adapt too early to a change (that your customers may not even have noticed themselves yet), you’ll have a problem. If you wait for the point of maximum security and only change when there is no other way, i.e. too late, you will be lost in the crowd and will have to struggle to regain your top position.
Making money is like being on the highway:
If you miss the last possible exit to the next petrol station when the tank is getting empty, you will be left behind! Conversely, you don’t want to stop at every single gas station every few miles just because you’re afraid you might run out of fuel later. But unlike on the motorway, there are neither signs nor automatic navigation systems in the electronic media.
1Scenario 1: The midfield disappears
The rich get richer, the poor get poorer. A tendency towards this can also be identified in making money with moving images. The midfield is dying off. There are only two types of providers left in the free market. One group is small and highly specialized, ranks among the best and operates nationally or internationally at a level where competence, experience and talent can hardly be beaten.
The other group, it is the majority, serves the lowest price segment. A video for € 1’200? Sure, that’s enough for an image film or for a web video. This type of provider also specializes. But not on quality, but on surviving on low budget or no budget. Filming or directing is out of the question for this stage. Filming shapes the offer (for the difference between these three types of production, see here).
Of course, when it comes to making money between the lowest segment and the cinematic high nobility, even in this scenario suppliers are still fighting for contracts. But because they are chronically too expensive compared to the low-price segment, and not sufficiently qualified to compete in the high-price segment, the majority of these suppliers sooner or later descend to the lower level, while only a minority manage to move up to the top.
Drivers for this development are also discernible on the part of the clients.
Because the market is getting tougher, many people with expertise in the video business have switched to the side of the clients and agencies. They know from their own experience that the price-performance ratio is not a problem, neither for top providers nor for the low-end segment. But always in the midfield.
On the flip side of that development is the fact that you’re not going to park yourself in midfield forever and three days with your career. You’ll make it to the top. Or not. In either case, you’re no longer wasting half your professional life on unrealistic dreams.
2Scenario 2: Making the fatal downward spiral for the money
The potential division of the market into a small group of highly skilled providers and a broad dregs of low-priced “video workers” is a veritable booby trap for making money. On the one hand, there is a lack of midfield where the future talents for the top positions can prove themselves. The jump from the very bottom to the very top thus becomes almost impossible. But not only that. Because the majority of filmmakers work at unattractive prices and can hardly develop, the industry as a whole is becoming less and less attractive. That’s the other side.
When, from a realistic point of view, little earnings and hardly any career beckons, the greatest talents and brightest minds forgo a career in film. They look for other fields in the creative industry and end up in the game industry, for example.
But where the brightest minds are leaving, quality continues to fall and therefore price pressure continues to increase. This sets in motion a fatal downward spiral. In the worst case, it ends with only the desperate (“I can’t do anything except video!”), ignorant (“It’ll work out somehow, it can only get better!”) or stupid (“Do you want to be an actress? Because I work in film and I have this project”) are willing to stay in the business.
Still, that has its good points, too.
If you have enough seat leather, you will see how suddenly new space is created for clever minds. Because the market and your customers will learn that competence costs in products that need to excel in impact, but incompetence doesn’t cost as much as incompetence,
3Scenario 3: Consolidation clears the market
Because the pressure on the midfield is steadily increasing, there are only two courses of action for many market participants. Either teaming up with a former competitor. Or cease doing business.
If you’re a company that can’t show a minimum size, you lose the opportunity to pitch for the few big film jobs. This is due to the pre-investments required by the market, which drive up acquisition costs, but also because the credibility to handle this type of order is lacking from the customer’s point of view.
Conversely, the cost pressure in the lower segment is so high that it is only possible to earn anything if resources are constantly utilised. So that cameras, editing suites and staff can be charged to clients for more than just a few days each month, smaller companies and VJ’s are joining forces and pooling their resources.
Because consolidation (the “grouping” of companies, but the word means “strengthen” in Latin for a reason!) reduces the number of companies fighting for orders, supply and demand return to normal. Those who do clean and solid work will again be paid decently for it.
4Scenario 4: Automation as an opportunity
More and more processes are being taken over by software. Digitization in image editing or recording, for sound or off-camera commentary is advancing in leaps and bounds. With artificial intelligence, Adobe Premiere automatically creates a first cut, automatically adds audio tracks to the image, and corrects colors. The editor is now also a sound engineer and graphic designer and usually also a realizer.
Even though the industry is driving its own downfall in making money with it, because it makes filmmaking easier and more attractive for customers as well, it is happily and unconsciously driving automation forward itself as beta testers. After all, at least in the short term, this can increase one’s own margin somewhat and prolong one’s survival somewhat.
Automation also creates new opportunities and professions. Not in the traditional professions, but for qualified professionals. At the same time, with digitization, film is freeing itself forever from the curse of technology. Without this ballast, what has always been the recipe for success for the moving image reappears: storytelling.
Those who can tell stories stay and become more important again.
YouTube, Facebook and Co. making money
What is the purpose of YouTube, Facebook, Google and other players that rely on the power of video? Make money! And how do you make more money if you’ve grown up as a video platform, marketing platform or portal for social media and realize that video is the future? One offers paying customers and free users the possibility to produce videos for them and to market them at the same time.
Everything from a single source! Because you don’t have to earn twice in the start-up phase or in a cut-throat fight, but want to gain market share and acceptance, you keep the prices attractive. So deeper than an independent video production. Because Facebook, Google / YouTube or Amazon know infinitely more about user behaviour due to their own data than the VJ from Mückenloch in Baden-Württemberg, these videos are also more effective. They fit the target group like a glove. The conversion rate is impressive. The offer of integrated marketing campaigns including video content from a single source is convincing and makes sense for the clients. The “normal” video producer, as the world still knew him until 2020, is suffocating.
What remains is the amateur filmmaker. He survives because he doesn’t have to make money off his videos.
🚀Feature film and public TV
The European feature film business is highly subsidised. Without government funding, no feature films. Feature film promotion is cultural promotion or economic promotion. Because taxpayers’ money is involved, strict attention is paid (unlike in the free market) to fair compensation when allocating funds. Here the quality is in the foreground. This should be purchased for market prices, but not at dumping prices as in the commissioned film.
This also applies to non-private TV providers such as ARD, ZDF, ORF (Austria) and SRF (Switzerland). Again, when it comes to making money, the rules of predatory capitalism play only a limited role. At least in the medium term. Feature films and TV productions play in the same market as their private competitors. Even if the cultural sector and the public service are always politically influenced, in the long term changing market conditions also have an impact on these genres.
What scenario occurs when making money with video?
Anyone who claims to be able to make trends and forecasts with borderline certainty is not serious. But assumptions and scenarios help to prepare for possible developments. Just because we at Filmpuls, as industry participants, are influenced by our current market environment, doesn’t mean it’s the truth.
All the scenarios mentioned in this article can occur together. Or none of them. Or only parts of individual forecasts. Think about what we’re saying. But don’t let that take away from your enjoyment of video. Because as a professional you already know: in film as in life (almost) anything is possible.
📌 Your experience counts!
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