In-House Video Team vs Agency: What Actually Costs Less?
Should you hire video people or use an agency? Here’s the simple truth: most companies waste money building in-house teams too early. An in-house team costs around $300,000 per year. Agencies charge $60,000 to $120,000 for the same output.
Let’s break down the real numbers.
Why This Comparison Matters
Most companies look at salary and think that’s the cost. A $70,000 video editor actually costs $130,000 when you include everything else.
Here’s what catches people by surprise.
You budget $70,000 for an editor. Then you discover you need computers, cameras, software, and office space. Suddenly that $70,000 hire costs almost double.
What One Video Editor Really Costs
Base salary: $70,000
Then add:
- Health insurance: $12,000
- Payroll taxes: $5,000
- Computer and monitors: $8,000
- Software licenses: $900 yearly
- Office space: $12,000 yearly
- Training: $3,000 yearly
Real first year cost: $110,900.
And that’s just one person. You need at least three people to make videos consistently.
The Idle Time Problem
Your team won’t make videos all day.
They’re in meetings. Waiting for feedback. Managing files. Coordinating with other teams.
Most video teams are productive about 70% of their time.
Plus, you have slow months and busy months. You’re paying full salaries during slow periods when there’s not much work.
The Simple Math
Make 12 videos yearly with an in-house team? Each video costs you $25,000.
Same 12 videos from an agency? $5,000 to $8,000 each.
In-house only becomes cheaper when you’re making 30 to 40 videos per year. Most companies aren’t there yet.
Check typical video costs to see standard pricing.
What an In-House Team Actually Costs
You need three people minimum. Total cost: $350,000 first year, then $300,000 yearly after that.
Why three people? Because video production has different jobs that need different skills.
The Three Roles
Video Editor: $70,000 salary
This person cuts footage, adds basic graphics, and handles audio. They’re your main production person.
Video Producer: $75,000 salary
This person writes scripts, manages projects, and keeps everything on schedule.
Motion Designer: $85,000 salary
This person creates animations and complex graphics. They make videos look polished and professional.
Total salaries: $230,000 yearly.
Benefits Add 30%
Health insurance, taxes, and retirement matching add about $70,000 yearly.
Now you’re at $300,000.
Equipment
Each person needs powerful computers and professional software.
- Computers and monitors: $40,000 first year
- Software (Adobe, etc): $3,000 yearly
- Equipment updates: $6,000 yearly
Office Space
Three desks with internet and utilities: $35,000 yearly.
Your Real Total
- Year 1: $350,000 (includes initial equipment)
- Year 2 and beyond: $300,000
If you’re making 15 videos per year, each one costs you $20,000 to $23,000.
That’s expensive compared to agencies. See budget planning for alternatives.
What Agencies Charge
Most B2B agencies charge $5,000 to $10,000 per video. Buy multiple videos upfront and prices drop to $4,000 to $6,000 each.
Here’s typical agency pricing.
Single Video Costs
- 90-second explainer video: $6,000 to $8,000
- Product demo (2-3 minutes): $8,000 to $10,000
- Customer testimonial video: $4,000 to $6,000
- Social media clips: $1,000 to $2,000
These prices include everything: script writing, design, animation, voiceover, music, and two rounds of revisions.
Volume Discounts
Agencies give you better pricing when you commit to multiple videos.
- Buy 3 videos: Save 10%
- Buy 6 videos: Save 15%
- Buy 12 videos: Save 20 to 25%
Real example: 12 videos at $6,000 each = $72,000 normally. With annual discount = $57,600.
You save $14,400 just by committing upfront.
What You Don’t Pay For
When you work with agencies, you skip all the hidden in-house costs.
- No hiring process
- No computers or equipment
- No office space
- No software licenses
- No managing employees
The agency handles everything. You just review work and approve it.
When you’re busy, the agency keeps working. When you’re slow, you don’t pay for people sitting around.
For companies making 10 to 25 videos yearly, agencies cost about 60% less than hiring a team.
Read about hidden production costs that agencies eliminate.
What About Hybrid Models?
Hybrid means hiring one or two people internally while using agencies for complex work. Total cost: $120,000 to $180,000 yearly.
Three hybrid setups work well for different situations.
Option 1: Strategy Person + Agency
Hire one person to manage your video strategy.
Their salary with benefits: $90,000 to $110,000 yearly.
They handle planning, brand guidelines, and managing the agency relationship. The agency does actual video production.
You spend $40,000 to $70,000 yearly on agency production for 12 to 20 videos.
Total cost: $130,000 to $180,000.
This works when brand consistency is critical and you need someone coordinating everything internally.
Option 2: Editor + Agency
Hire one video editor.
Their cost with benefits and equipment: $100,000 to $120,000 yearly.
They handle simple videos like testimonials and social clips. Agency handles complex animation.
You spend $30,000 to $60,000 yearly on agency work.
Total cost: $130,000 to $180,000.
This works when you have lots of simple edits and occasional complex projects.
Option 3: Producer + Editor + Agency
Hire two people to handle most production.
Their cost: $200,000 with benefits and equipment.
They film and edit videos. Agency handles animation only.
You spend $20,000 to $40,000 yearly on animation work.
Total cost: $220,000 to $240,000.
This works when you’re making 30+ videos per year and most are straightforward productions.
When Hybrid Makes Sense
Hybrid works best when you’re making 20 to 35 videos yearly. That’s too many for pure agency pricing, but not quite enough to justify a full team.
If you’re making under 15 videos per year, stick with agencies. The internal salary isn’t worth it.
See production workflows for coordination tips.
The Three-Year Cost Comparison
Over three years: In-house costs around $975,000. Agencies cost around $180,000. Hybrid costs around $450,000.
Let’s look at what you’d actually spend.
Scenario: Making 12 Videos Per Year
In-house team (3 people):
- Year 1: $350,000
- Year 2: $300,000
- Year 3: $310,000
- Three-year total: $960,000
- Cost per video: $26,667
Agency partner:
- Year 1: $60,000
- Year 2: $60,000
- Year 3: $63,000
- Three-year total: $183,000
- Cost per video: $5,083
Hybrid (one person + agency):
- Year 1: $170,000
- Year 2: $150,000
- Year 3: $155,000
- Three-year total: $475,000
- Cost per video: $13,194
Winner: Agency saves you $777,000 over three years.
Scenario: Making 24 Videos Per Year
- In-house: $960,000 total ($13,333 per video)
- Agency: $340,000 total ($4,722 per video)
- Hybrid: $500,000 total ($6,944 per video)
Winner: Agency still saves you $620,000.
When In-House Becomes Cheaper
In-house only wins when you’re making 40 to 50 videos per year. At that volume, your per-video cost drops to $6,000 to $8,000.
But most B2B companies make 10 to 25 videos yearly. That’s clearly agency territory.
Check pricing models to compare options.
Hidden Costs People Miss
In-house teams have hidden costs that add 15% to 20% to your budget: quality ramp-up time, employee turnover, management overhead, and skill gaps.
Let’s talk about what budgets don’t show.
Quality Takes Time to Build
Agencies deliver professional quality from day one. They’ve made thousands of videos.
Your new in-house team needs time to learn your brand and build their skills.
- First 3 months: 60 to 70% of desired quality
- Months 4 to 8: 80% of desired quality
- Months 9 to 12: Full quality
Your first six videos will probably need expensive rework. That’s $10,000 to $15,000 extra in year one.
People Leave Jobs
Creative professionals change jobs every three years on average.
When someone leaves your team, you pay $15,000 to hire and train their replacement. Plus you lose all their knowledge about your brand and processes.
Agencies handle all turnover invisibly. You never notice when their people change.
Management Takes Your Time
Managing an agency takes about 5% of your time. Quick project reviews and quarterly planning.
Managing an in-house team takes 20% of your time. Weekly meetings, performance reviews, solving problems.
That extra 15% of a $150,000 salary is another $22,500 per year in hidden cost.
You Still Need Outside Help
Even with three people, you’ll need to outsource sometimes.
- 3D animation work: $5,000 per project
- Professional voiceover talent: $500 per video
- Live-action filming: $3,000 per shoot day
- Language translations: $1,500 per language
Most companies spend $15,000 to $25,000 yearly on outside help even with an internal team.
How to Decide What’s Right for You
Ask four simple questions: How many videos? How complex are they? How fast do you need them? Do you have video expertise?
Here’s a simple decision framework.
Question 1: How Many Videos Per Year?
0 to 15 videos: Use agencies
16 to 25 videos: Use agencies (maybe hybrid)
26 to 35 videos: Hybrid model
36 to 50 videos: Hybrid or in-house
50+ videos: In-house possible
Question 2: How Complex Are They?
Mostly complex animation: Must use agency
Mix of complex and simple: Hybrid works
Mostly simple editing: In-house editor viable at high volume
Question 3: How Fast Do You Need Them?
Same-day turnaround needed: Need in-house editor
One-week turnaround okay: Hybrid works
One-month timeline fine: Agency works great
Question 4: Internal Expertise?
Video expert on staff already: Hybrid maximizes their skills
Building capability from scratch: Agency provides guidance
Strong creative team: Can manage agencies effectively
Quick Guide by Company Stage
Small company (under $5M revenue):
Make 12 to 18 videos yearly
Best choice: Agency
Annual cost: $50,000 to $90,000
Growing company ($5M to $20M revenue):
Make 18 to 30 videos yearly
Best choice: Agency or hybrid
Annual cost: $90,000 to $170,000
Larger company ($20M to $50M revenue):
Make 30 to 45 videos yearly
Best choice: Hybrid
Annual cost: $170,000 to $280,000
Big company ($50M+ revenue):
Make 45+ videos yearly
Best choice: In-house team plus agency
Annual cost: $300,000+
The key: don’t jump to in-house too early. Most companies waste money doing this.
See when to invest for timing guidance.
Real Company Examples
Real companies show the difference: One spent $67,500 yearly with an agency versus $339,000 for in-house. Another tried in-house, wasted $190,000, then switched back to agencies.
Let’s look at actual examples.
Example 1: Marketing Software Company
Company size: $4.5M revenue, 35 employees
Video needs: 15 videos per year (explainers, feature demos, customer testimonials)
Chose: Agency partnership
Three-year spend:
- Year 1: $67,500
- Year 2: $72,000
- Year 3: $81,000
- Total: $220,500
If they had built in-house team: $975,000 over three years
Money saved: $754,500
What they did with savings: Spent it on customer acquisition. Added 30 new customers worth $750,000 in annual revenue.
Example 2: Sales Platform Company
Company size: $22M revenue, 120 employees
Video needs: 32 videos per year (products, customers, training, events)
Chose: Hybrid model (one internal strategist plus agency)
Three-year spend:
- Year 1: $182,000
- Year 2: $168,000
- Year 3: $175,000
- Total: $525,000
If they had built in-house team: $975,000
Money saved: $450,000
Why hybrid worked: Internal strategist maintains brand consistency across global markets. Agency handles production.
Example 3: Company That Tried In-House
Company size: $12M revenue, 75 employees
Their thinking: “We make 20 videos yearly. Let’s hire people.”
What happened: Hired video producer and editor
Year 1 actual costs:
- Salaries: $148,000
- Benefits: $44,000
- Equipment: $32,000
- Software and office: $31,500
- Freelancers for skill gaps: $18,000
- Total spent: $273,500
Videos actually made: 14 (not 20, because of learning curve)
Cost per video: $19,536
What went wrong: First six videos needed expensive rework. Producer left after 14 months. Replacement cost another $15,000.
Year 2 decision: Disbanded team, went back to agency
Year 2 with agency: $84,000 for 21 videos ($4,000 per video)
Total money wasted: $189,500
Lesson learned: Volume alone isn’t enough reason to build a team. You also need the right mix of simple versus complex work, plus management capacity.
Review video assets needed to estimate realistic volume.
Timeline for Making This Decision
Take 60 to 90 days to decide properly. Two weeks analyzing needs, two weeks modeling costs, four weeks vetting agencies, and four to six weeks testing. Then commit for one year minimum.
Don’t rush this decision. Here’s a smart timeline.
Weeks 1 to 2: Count Your Current Videos
How many videos did you actually make last year? Count everything: marketing videos, sales demos, training content, internal communications.
What types were they? Simple edits or complex animation?
How many will you realistically make next year? Be honest, not optimistic.
Weeks 3 to 4: Build Simple Cost Models
Calculate three scenarios:
- Agency option: Get actual quotes for your volume
- Hybrid option: Price one internal person plus agency work
- In-house option: Price full three-person team
Use the numbers from this article as starting points.
Weeks 5 to 8: Talk to Three Agencies
If agency or hybrid makes sense (most common), talk to three different agencies.
Review their past work. Ask about their process. Get detailed proposals. Check client references.
Weeks 9 to 14: Test With Real Work
Make one or two actual videos with your top agency choice.
Evaluate their work quality. Test their communication. Check if they understand your business.
This $8,000 to $16,000 test investment prevents expensive long-term mistakes.
Week 15: Make Commitment
Sign annual agreement with chosen partner. Lock in volume discounts. Set clear expectations.
Commit to your choice for at least 12 months. Switching constantly wastes money and time.
Annual Review Every Year
Check your model fit every year:
- Volume increased 60% or more? Consider upgrading your model.
- Volume decreased 40% or more? Consider downgrading.
- Need same-day turnaround regularly? Think about adding internal editor.
But give each approach proper time to work before switching.
Summary
Video production cost comparison shows agencies save most B2B companies about 60% compared to building in-house teams. An in-house team costs around $300,000 yearly while agencies charge $60,000 to $120,000 for the same output. Hybrid models run $120,000 to $180,000.
In-house only becomes cost-effective when you’re making 40+ videos per year. Most B2B companies make 10 to 25 videos yearly. That puts them firmly in agency territory.
Simple decision rule: Under 20 videos yearly = use agencies. Between 20 and 35 videos = consider hybrid. Above 40 videos = evaluate in-house carefully.
Ready to see what works for your specific situation? Contact Motionvillee for custom pricing based on your actual video needs.
