The small business video paradox

The marketing manager says: "Limited budget, but we still want quality."

The agency responds: "We'll do our best with the available resources."

Both are lying, but they don't know it. And the result will be mediocre for structural reasons, not moral ones. I've seen this pattern repeat hundreds of times over forty years, from the digital transition of the nineties to today. Always the same film, just different actors.

The mechanism is more interesting than it appears at first glance, because it reveals something fundamental about how purchasing decisions actually work in micro and small enterprises.

The owner without a compass

In small companies, whoever approves the video quote is almost always the owner or managing director. This person built the business with their hands, knows every aspect of their sector perfectly. They know exactly what a skilled worker should cost, an industrial machine, a container of goods from China, a software licence. They've developed over the years a precise intuition for recognising when a supplier is inflating prices or offering real value.

But video is completely outside their mental cost framework. No prior experience, no terms of comparison, no way to understand whether five thousand pounds is reasonable or if the agency is taking the piss. It's like asking a carpenter from 1850 to evaluate a quote for "brand positioning" - the words make sense individually, but they don't combine into something he can translate into concrete value.

The result is that he sees only a cost. A cost that seems arbitrary, questionable, probably inflated. He can't see it as an investment because he lacks the mental framework to connect that expense to a measurable result.

The problem worsens with internal videos

The situation becomes even more complicated when we're talking about internal videos. A video for external marketing at least theoretically produces sales, generates contacts, brings measurable results. But a video for employee onboarding? A video about company values? A message from the owner to the team?

Here we're in the territory of "company culture" and "internal communication" - concepts that for a practical entrepreneur, used to seeing tangible results every day, sound dangerously similar to well-packaged hot air. No metrics. No sales to track. Just the vague promise that it "improves employee engagement" or "professionalises the internal image."

For an owner who has always spoken directly with his colleagues, who knows them by name, who solves problems day by day in the field, the idea of spending thousands of pounds to "communicate better" seems an incomprehensible waste.

The temptation to DIY

At this point arrives the fatal temptation. "But if it costs that much, we can do it ourselves. My nephew has a good phone and knows how to edit videos. Or we'll ask the marketing manager to manage. Or perhaps our graphic designer can learn."

I've seen this mistake repeat too often to count. The result is always the same: time wasted in endless meetings deciding what to say, frustrated people who have to do work for which they have neither competence nor tools, a final product that embarrasses everyone and that no one will actually use. But meanwhile they've "saved" on the agency's quote.

The paradox here is brutal. On one hand, I've learned to be wary every time I hear talk of "let's save by doing it ourselves." If you want things done properly, you have to have them done by people who know how. This applies to electrical installations, to accountancy, to legal advice, and it applies to video production as well.

On the other hand though, how do you select who really knows how to do it? How do you distinguish the serious agency, with real competences and justified prices, from the one that improvises and inflates costs? Without a mental framework to evaluate that category of expense, every quote seems arbitrary. And when everything seems arbitrary, the natural temptation is to choose the cheapest or convince yourself you can do it yourself.

The structural catch-22

Here we are at the crux of the problem. To select the right professional requires competence that the owner doesn't have. It's a structural vicious circle: I don't know enough to evaluate who really knows, but to learn to evaluate I'd need to already know enough.

In large companies this problem is solved with specialist personnel. There's someone in the team who knows the video production sector, can benchmark, can read a quote and understand if it makes sense. In micro and small enterprises, no. The owner must decide alone, without tools.

And here emerges the second face of the problem: the agency that accepts the project knowing the budget is insufficient. Why do they do it? Because refusing means losing turnover, and in a competitive market every project counts. So they accept, but cut costs. Economical or free location to avoid going mad with permits and rentals. Reduced equipment, what they already have in-house. Minimal crew or even a single operator doing everything. Hoping that creativity can compensate for scarce means.

It rarely works. Creativity is important, certainly. But it doesn't work miracles when time, tools and people are lacking. The result tends towards mediocrity for mathematical rather than artistic reasons.

Guaranteed mutual dissatisfaction

On delivery, the owner watches the video and something's not right. Can't explain exactly what, but was expecting something different. Perhaps more "professional", whatever that means. Perhaps more impactful. Perhaps simply different from what's in front of them.

The agency, for its part, is frustrated. With that budget they really did the maximum possible. They cut where they could, managed, put in creativity to compensate for scarce resources. And now the client isn't happy.

Both are right in their own terms. The owner has spent money that for them is significant and ends up with a product that doesn't satisfy. The agency has worked hard to fit a ten thousand pound project into a five thousand pound budget. Both are dissatisfied. Both feel damaged.

But neither has made a mistake through bad faith. It's the structure of the situation that produces this negative outcome almost deterministically.

The pattern repeats everywhere

This mechanism isn't just about videos. It's the same identical pattern I see operating in every purchase of specialist services where there's a lack of internal competence to evaluate.

The small company that saves on the website by having it done by a cousin "who knows about computers", then finds themselves with something unusable and has to do it again from scratch. Or completely underestimates IT security because "we're small anyway, who's going to attack us", until it happens and they discover what a data breach really costs.

On the other side of the coin, the same company gets convinced to buy an expensive CRM system because the salesman did an impressive presentation with lots of coloured slides. They implement it, no one uses it because it's oversized for their needs, but they keep paying the annual licence because "we've got it now."

Or worse: they spend significant sums on "digital transformation" or "innovation strategy" consultancy that produces beautiful slides and hundred-page reports that no one will ever read. Meanwhile they save on the one thing that might really be needed - a competent person to follow practical implementation day by day.

The problem isn't how much budget they have. It's how they allocate it. They save where they don't understand the value, so they entrust it to whoever costs less or try to do it themselves. They spend too much where someone has managed to sell them a dream well, even if it's not needed. And in between, the things that would really be needed often remain uncovered because they don't fall into either category.

Incompetence in evaluation doesn't just produce low budgets. It produces wrong allocation of resources. DIY where professional competence would be needed. Excessive spending where something simpler would suffice. Underestimation of real risks. Overestimation of miraculous solutions.

The pattern that doesn't change

It's not a question of ethics or competence of individual people. It's incentive architecture combined with information asymmetry. When the client doesn't have a framework to evaluate quality before purchase, and the supplier has incentives to win the commission or maximise the sale value, the system systematically produces bad decisions.

It's selection instead of persuasion. Some clients simply cannot buy well what you're selling, even if they want to. They don't have the tools to evaluate, select, distinguish who knows their stuff from who's improvising, understand what's really needed from what's superfluous. And pretending otherwise, from both sides, produces only results that no one really wants.