To keep a long story short, I made a video a few years ago, it went viral, and I licensed it for a TV commercial. Now I’ve been contacted by another agency for a new commercial for a very (VERY) large company, but the details are different.
My first agreement was for around 1xxx dollars and it was only for a TV commercial in one country for a set period of time and the final commercial only used about 1-3 seconds of my video. That price was their first offer and I took it without negotiating since I knew almost nothing about video licensing.
This new agency is contacting me about creating a commercial except the details are totally different. This will be broadcast on TV as well as transit stations, all their social media pages, their official website and on internet ads. The description also suggests that it will feature much more prominently in the commercial than the last one and the licensing period is longer. Also, the target country has a much higher GDP than the last one, the company is much larger and the Ad industry has grown significantly since the last contract was signed.
I should mention that they asked me for the licensing fee, so I don’t even have a ballpark estimate to negotiate.
All of the details I’ve mentioned seem like they would be relevant to coming up with a first offer, but the fact that I have no idea if I got ripped off on my first contract complicates things.
Since I didn’t negotiate, if the first price was really far below fair market value, then any price adjustments I make based off of it would be lower than they should. If it was a fair price, then my first offer could be way too high, and the agency might opt for another video (Based on the description, it seems like my video’s content isn’t specifically related to the commercial). I want my first offer to be as close as possible to whatever price would prompt them to seek an alternative, but I have no idea what too high is.
So my question is how would someone with more experience than me handle this? Would you ask friends, colleagues, and other content creators what they normally charge for licensing? Would you base it off your previous experience creating commercial-like content? Like what would a similar video cost to produce, or how much would you be willing to pay based on what you know about advertising budgets. The more I try to come up with ways to estimate the value of my video, the more complicated the situation starts to seem.
I’m considering either asking them for an offer, or just adding an extra digit to my last price and calling it a day.