How Much $$$ for TV Commercial?

[aaron_cabral]

Hi Everyone,
Up until now I have always recorded and produced my (and my various band's) music as a hobby and for my own personal enjoyment. However I was just given an opportunity to supply some music to a local business for a TV Commercial (a mixed martial arts gym). Again this is a local business that is fairly new and they will most likely not have the advertising budget that most large and established companies have. With that said, I have no idea how much I would charge them for my music. Can anyone with some experience in doing music for commercials tell me where I even start with something like this? I am interested to hear what some of you have done in this industry. I am excited to potentially get more involved in the "business" of selling my music but I need a starting point. Any help or comments would help. thanks!

Aaron

[jayjo19]

Hi,

Well it depends on your city/area/potential market size (for the business), on the time when the commercial will air (on prime time, during the day, late at night with the infomercials), the number of times commercial will air, etc etc etc. I would strongly suggest that you hire an attorney, or a consultant, not really to figure out a price but more to have a solid contract.
Also, did you register your song(s), do you have publishing, etc. Publishing is extra money aside the licensing fee.
But I'm not a lawyer nor a (show) business man so I can't really give you a precise idea. Hope I've been able to help.

Jeremy

[MIDI Life Crisis]

You can charge what you're worth. Sounds flippant, but it's not. Suzanne Chiani got something like $50k for 3 notes back in the 1970's for the "ERA" soap score. Three notes! Don't get too excited. Most local commercials only pay a few hundred at best. If you can get $250-500 for your first, go for it. You also want repeat business and referrals. Bump up the price as time goes by.

Then join BMI or ASCAP and register the commercial. You client will be required to give you "media buys" - lists of where they are broadcasting which also tell you how much they spent on the spots, how often they air, etc. YOU MUST GET THESE FROM THE CLIENT TO GET PAID.

On a local spot that runs a few thousand times you might see about $500-800 more in residuals (royalties). If the spot runs a long time, your little $250 license could bring in a few thousand or more. National spots bring in substantially more, but that's for another thread...

Bottom line: Join BMI or ASCAP and let them help you.

[FMiguelez]

.

I'm pretty sure things are very different here, but this might serve as some kind of reference.
For a typical TV ad scoring gig, the standard/average here is around $4K - $5K (dollars) for unlimited use in Mexico for during 6 months, TV only. You can not use that music for anything else during a 3 year period. After that, you can do whatever you want. If they want to keep using the music for more time after the first 6 months, you charge them the same again, for each subsequent 6 month period. This includes royalties and production fees (so you don't get extra royalties after this payment, unless they buy another 6 month term).
If you're lucky and they air the commercial in the USA, that's %300 more. A latin-american package is around %200 more (for 6 months).

But IME, the fees vary wildly. They can be as little as $500 to as much as $30K - $40K.

[MIDI Life Crisis]

.

I'm pretty sure things are very different here, but this might serve as some kind of reference.
For a typical TV ad scoring gig, the standard/average here is around $4K - $5K (dollars) for unlimited use in Mexico for during 6 months, TV only. You can not use that music for anything else during a 3 year period. After that, you can do whatever you want. If they want to keep using the music for more time after the first 6 months, you charge them the same again, for each subsequent 6 month period. This includes royalties and production fees (so you don't get extra royalties after this payment, unless they buy another 6 month term).
If you're lucky and they air the commercial in the USA, that's %300 more. A latin-american package is around %200 more (for 6 months).

But IME, the fees vary wildly. They can be as little as $500 to as much as $30K - $40K.

We are talking abot "local" spots, not National spots. Also, limited use, not unlimited use and a non-exclusive license. Also, we get royalty payments.

[FMiguelez]

.

I see what you are saying.

It's just that this confirms that things are much more structured there in terms of licensing, and all the different things you can do with your music. It seems you have much more control over almost every detail.

Here there are no such things as "local" spots. It's always national. IME, for good or bad, almost all contracts are the same. The only thing that varies are the amount of payment, the medium, the lenght of time, and if it's national or international. That's it.

Regarding royalties, we DO get them. It's just that they are a fixed amount, previously negotiated, and they are "embedded" in the payment. So it doesn't matter if the commercial airs 1 time or a million times (during the agreed amount of time).

In that regard, I kind of like more the way it's over there.
So please tell me something: Do you also get to negotiate in a state-by-state basis? And do you negotiate different things in different states for the same music if required? (like the music can be on the radio in Colorado, but only on TV in Arizona, and cable in Texas?)

If so, how do you keep control of all that, because it seems it can get a bit complicated (but *can* be a good thing in terms of money) .

[MIDI Life Crisis]

A national spot in the US pays WAY more than a few thousand bucks. Often, these will be buyouts from production houses and little guys simply do not support that market at all. The production budgets for music can easily exceed $20-30, not including composer fees and licensing. That's just to pay the union orchestras who play the music. So let's keep this in perspective. The OP is talking about a LOCAL spot in a limited (probably cable) USA market, and they pay chump change. You just cannot make a comparison in your market, FMg. It's like comparing a Big Mac to home made tamales. (BTW, I'll take the tamales over a Big Mac ANYDAY!

[RadioFunHouse]

I'd suggest researching the competition, so to speak. Call an ad agency or two in another similar city in your state. Ask to speak to whoever produces ad music at the agency, and get a price range from them.

Another way to price it: Start with your outside costs [singer(s), overdubbers, studio if applicable]. Then figure out how much time this will take you. Be sure to include meetings, demos, revisions. (I know much of this will be a guess.) Say that you want to make $75/hr. If you guesstimate 20 hours, that's $1500 + your outside costs.

That's roughly how I'd go about budgeting for a small-town-small-client. One good thing about this way: You can feel comfortable that you asked for what it was really worth to you, so if you get it, it properly rewards your time, and if not, it's really OK that the job goes away.

This budgeting process is entirely different in a larger market.