Retainers vs. Projects

by Feb 7, 2020Work

Retainers vs. Projects

One question that always comes up for new videographers and between clients and creative teams is whether or not to work on a project by project basis or establish a longer term relationship through the use of a retainer. For those that are unaware, a retainer is essentially a regular recurring fee, for a defined amount of work produced, over a specific interval. Usually this is something like “We’ll produce W videos every X period for the price of Y per Z”. In order to understand what option works better for you, I have laid out the Pros and Cons of each from the standpoint of each stakeholder: the Creative and the Client.

PROJECTS: PROS

As a Creative

As a Creative, there are two primary benefits to working project by project.

First of all, you can typically charge more for a one-off project than for a package that a client is purchasing in bulk. This means that your hourly or daily rate comes out to a higher number and you feel better about yourself and think gain the confidence to know that you’re “worth” a certain dollar amount (trust me you’re worth more than you think).

Second, you can avoid complicating new relationships by not LOCKING your clients in to something. This benefits them if they’re new to video marketing and production, and it can benefit you by helping you avoid being locked in with a bad client. However, don’t let “bad” clients scare you… If you set expectations properly at the beginning of the relationship and get a contract in place, the worst thing about a “bad” client should be just having to finish their project and move on.

As a Client

There’s a few reasons why a project by project basis works best for clients but by far the biggest benefit is the avoidance of being locked in with an unknown vendor. As with any industry, there is a WIDE variety of companies and individuals in the content production field and some are better than others. You can usually tell the experienced and high-quality companies from the “man with camera” operations but sometimes people are good at hiding their lack of experience until the project due date comes up and they have nothing for you.

That being said, working Project by Project allows you to try out some different teams and see who you connect with the most. It doesn’t always come down to quality and experience either, sometimes you just like the way a person carries themselves more than another group and that’s OK.

PROJECTS: CONS

As a Creative

As a Creative, the primary downside of working project-to-project is pretty apparent: you don’t always know where your next gig is coming from and you constantly have to hustle and sell to keep the money coming in. Businesses don’t work if they don’t make money so it’s imperative to always have cashflow. If you hit a slow point or there’s a downturn in the economy there’s no cushion of recurring clients for you to continue working with to pad your books until more projects start popping up.

Additionally, from a more creative and technical standpoint, it can be difficult to plan and execute shoots when they you don’t know they’re coming and you can’t find a regular cadence. Obviously we love when a client calls us up for a random big project that we hadn’t planned on (a BLUEBIRD as my Director of Sales used to say when I worked at RED), but you can’t live your life HOPING that something comes in.

If you do not have a way to actively bring in new clients and revenue, you don’t have a business; you have an expensive hobby.

Unknown

As a Client

The downsides of working project-to-project as a client is basically just the reverse of the PROs… Even though this scenario allows you to avoid getting locked in with a charlatan claiming to be a legit producer, it also prevents you from locking down a talented individual or team to have them be available on a frequent basis for you. In this scenario, you become beholden to their schedule instead of them being aware of your schedule and needs.

RETAINERS: PROS

As a Creative

If you’re a responsible and professional Creative or a Producer of some kind, retainers can be awesome. Having a retainer structure in place with your top clients gives you peace of mind that there is income coming in for regular work and you get the ability to develop a strong relationship with your best clients. Over time, working in a structure like this allows you the comfort and freedom to create your best work because you will know the ins and outs of your clients’ brands, what works and what doesn’t work for them in their market, and develop some amazing consistent results for their brand.

As a Client

On the client side, the retainer structure let’s you work with the same person (hopefully you’ve vetted them and know they’re legit) over and over so that your brand and messaging can gain a consistent look, feel, and “voice”. Your internal team will all come to regard this other person or group as one of their own coworkers and will hopefully feel comfortable enough reaching out to their team for requests that they may have.

In addition, you get a much more organized way of planning your costs. Instead of having these big “pops” of expense whenever you need new assets created, you can more effectively budget your resources because you know how much you’ll be spending each month.

RETAINERS: CONS

As a Creative

As a business-owner, when working with a retainer, you HAVE to get a contract in place so that there is an understanding of what work is, and more importantly what isn’t, included in the retainer. The primary concern that I have when entering into a new retainer relationship with a client is what we could describe as “Scope Creep”. Scope Creep is what happens when the boundaries of a relationship are pushed and a client begins asking for more and More and MORE from you. If you haven’t established a strong understanding at the very beginning of what they do and what they don’t get, then ultimately it is YOUR fault if the amount of work you’re doing starts swelling while your income stays the same.

Another thing to be aware of is your time commitments. Running a business takes a lot of attention and you can very easily overextend yourself and your time commitments can quickly outgrow your number of available hours. If you have a large team at your disposal this may be less of an issue, but if you are a solo operator you have to keep a close eye on how much work you’re promising to your retainer clients and still leave enough bandwidth to run your business and to tackle the occasional project that pops up.

As a Client

If you are in “The Client” role and you have decided that you want to take on an outside creative team then you have just taken a huge step towards scaling your business, and this is a step that not everyone can handle. By entering into a retainer arrangement with a Creative Team, you have committed to them, to your company, and to yourself that you have what it takes to rise to the next level of your business. The primary downside to the client in this situation is financially related: you have to have the bandwidth and the capital to honor the contract for the duration of it AND your company has to be prepared to grow exponentially at that time. If you’re ready for that challenge, then establishing a retainer with a reputable creative team is actually one of the best things you can do.

But hey, what do I know, RIGHT?

In conclusion, it’s important for you to look at all of the options that are available to you when you enter into a new relationship. There are a lot of talented people out there but sometimes they’re hard to find so when you do find those great teams you should do everything you can to grow that relationship and make it a consistent interaction.

If you have any questions about how we structure our relationships with clients, feel free to reach out to us via our CONTACT FORM.

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