Licensing a single track to an Ad Agency

[echoflex]

I’m hoping one of the more experienced on here can help me on this.

Scenario 1
I have a song distributed by Symphonic Distribution and Songtrust is the publishing administrator and my own publishing company is the publisher. I’m contacted by an ad agency directly and they want to use that song in a TV commercial or web video.

Question
1. Should I be the one supplying the ad agency with a contract or is it ALWAYS the ad agency writing up the terms?
2. What is a typical way this plays out?

Scenario 2
An ad agency or production company asks me to write a custom track for a TV spot or a corporate video.

Questions
1. Should I be the one supplying the ad agency with a contract or is it ALWAYS the ad agency writing up the terms?
2. What are the steps I take as far as registering?
3. How does this normally play out?

Thanks to all of the experts on this site you regularly contribute their knowledge!

[Art Munson]

Good questions echoflex and I’m sure some with more knowledge than I on this will jump in.

[Music1234]

Echoflex everything is negotiable.

If an agency contacts you to license your song into an ad ask them to supply you with

1. Name of product or brand needing the music?
2. Where will it air? Nationally? Locally? Regionally? on TV? On radio? Social media only?
3. How long do they want to rent the song for their project?

You need a lot more information before you can present a quote and definitely do not be shy about asking all these questions. The bigger the brand, the larger the fee you must charge.

Contract for original composition:

Same questions apply. Do not transfer ownership of the title unless they pay big money.

Commercials are not “one size fits all”. There is a Huge difference doing music for an ad for a company like Apple, ATT, PG as opposed to companies like Local furniture stores advertising next weeks 25% off sale on TV.

Apple, PG, ATT, T-Mobil, McDonald’s, State Farm Insurance,(S&P 500 companies) I would Charge $20,000 to $30,000 for an original composition going on TV nationally in the USA.

For what it’s worth I charged a small seed company 2K last year to write an original jingle for them so they can run radio ads in only rural farm land parts of the USA to sell seeds for crops.

NEVER under sell. Always quote a high fee because they will just counter offer.

There are no “standard” rules for negotiating contracts for music licenses. It’s the wild west. But I would say that typically ad agencies do present music producers with contracts that are almost always highly favorable to them. They often want a work for hire deal where they take ownership of the composition. That is OK, just make sure you are paid properly for that.

Here are some recent licenses I sold to advertisers:

ATT (To be shown “in store only” for one year term not for air) $1200

Pizza Hut – radio only for 6 month term :15 ad – $3000

I think reasonable price ranges are:

1. Social Media internet Ads only $1000 to $2000
2. Radio Spots $3000 to $5000 (From a perspective of a big brand)
3. Regional TV spots in Markets like NYC, LA, Chicago $5K to 10K
4. National Ad campaigns – well this where you just have to be savvy and never under sell yourself

Ad agencies are also learning how they can exploit the stock sites for massive cost savings and I do not, unfortunately, see this problem going away any time soon because stock sites are clueless with how to handle these deals with care. Complete ignorance, being way too nice to those who have a lot more money, absolute stupidity and another problem that ruins our business. This is why performance royalties (As Art knows all to well with Single Care) are such an important part of our revenue stream.

Just don’t under sell yourself. If they contacted you that means the track is already on the spot and they want it! YOU have the upper hand. Don’t do anything stupid where you leave money on the table.

Sorry to sound harsh but this is the very reason why YOUR MUSIC ,YOUR FUTURE came into existence. There are so many young and new music producers who just don’t understand how to price their music.

Registering the track? Just register the title at your PRO as Writer and Publisher! Do it now. Immeditaely. Stop everything you are doing and register that title right now. What…are you going to be nice and offer them the publishing as a way of saying “thanks for the gig” ?

[echoflex]

@music1234, first off, you are one of the experts I am thanking in my post. Lots of good nuggets in this response. I’d like to dig a little deeper with a few things you brought up. This is not just to you of course, all the other pros on here as well.

I come at this from the post production world where I’ve been the editor or sound mixer going through the libraries choosing a track for a promo. Most of these were web only promos that would live on YouTube or the client’s web site. But the clients were Jeep, Dodge, LA Times, Vizio and other big brands. The budget was always mega low for the music. We got TONS from Premium Beat and a few other sites. Experiencing this kept me from bothering with the effort of getting into all of this. But I, like everyone else on here, make the music no matter what because I love to, so it seemed like I should put the effort in on the biz side.

So, this brings me to why I started this post. It is less likely that a brand will have contacted ME (at least for now). It is MORE likely that I will be working at a post house with an ad agency and I will have the opportunity to say, “Hey, what do you all think of these tracks for this promo we are working on?”

So regarding a contract, I’m assuming a big brand will ALWAYS have their legal drawing it up?

Currently I’m waiting to hear back from a fellow editor who is trying to get me hired to compose music for a health conference video. In this scenario, it seems like I would be the one to supply the contract. Would that be typical? Since the client is probably someone like Aetna or Doctors Without Borders (someone not really IN the Biz).

[Art Munson]

Great response Music1234. Thanks!

[Music1234]

echoflex, anyone can present a contract, either buyer or seller of services. Typically a buyer asks for a quote. Be professional with your quote. Draft a the quote with your company logo, address, email, phone, define the scope of the work you are doing and the price you expect to be paid. Look at the quote as the beginning of the “work order”.
Once they accept the quote draft a Purchase order for them to sign that clearly defines the work you will be doing.

Writing for a corporate video will most likely be a work for hire

scenario and you should structure the deal so you are licensing the music to them (even if you are scoring the video). This way you can still own this music and have it work for you in another way on future opportunities such as library music, background usage into shows, documentaries, etc.

In all honesty, I am surprised the video editor would not just use stock music to underscore a corporate video, but if there is money laying around in the production budget for you to score the video, good for you! Charge as much as you can. I do not see this resulting in any PRO performance royalties unless it gets on TV one day. So get all your money up front for this kind of job.

[Music1234]

Art, my brief respone “poofed’ away some how…can you find it?

[echoflex]

@music1234, Thank you for taking the time to give me this input. Excellent info.

You have underscored my point from my previous reply – As I said, my company would RARELY hire a composer for any of the big brands we were working with. I am surprised anyone can make money at this if you don’t have connections. And the only reason I MIGHT get to do this job IS because I have the connection to the video editor since we used to work together at that previous company. You are 100% correct. I imagine he probably would (and still may) just grab a library track if he didn’t know I was trying to get some music work. So, fingers crossed. And when you say you were paid $2000 from a seed company for a rural TV spot – SHOCKING!! And good for you. But seriously, that is shocking.

Regarding Your Future Your Music, we really need them or some entity to organize this industry into a powerful or at least semi powerful lobbying group. I have to imagine that is talked about amongst you pros with all the subscription problems and the recent Discovery issue.

Here is one example of how one of our own could contribute to the subscription service without even wanting to. The person I’m talking about is me, sadly.

I make my living in post production and went freelance last year. I get paid well from ad agencies/post houses, but I want to make money in between the freelance gigs. So part of that is working on library music and part of it is trying to get remote work through online portals like Fiverr. I will make WAY less money from these gigs, but it is something to do between the “real” gigs that pay.

If you have ever gone to a site like Fiverr and looked up “video editor”, you’ll see people in higher income countries have to compete with editors in lower income countries (just like composers). And they offer all the stock video, and royalty free music you could want. And I’m sure they do it by having a subscription to Artlist or Envato (audio jungle) , etc… I imagine I will have to join one of these when the first job comes in where I need the assets and the pay is at the bottom. Do I want to contribute to them, no. Will I do it because I have to pay the bills, yes. Would I welcome some organization stepping in to make the system more fair? Absolutely!

[Music1234]

And when you say you were paid $2000 from a seed company for a rural TV spot – SHOCKING!!

It is not shocking at all. I had to write a piece of music that specifically suits their brand and their audience. I had to hire and pay a great, professional singer to sing the jingle. I had to Record, mix and sell them the jingle where they can now build their brand for life with the jingle in ads, on their web site, on youtube, on facebook, etc.. Are we supposed to work for 2 days on a 60 second jingle, and pay a singer within a $200 budget? The sad fact is that there probably are music producers who actually would write a jingle, hire a singer to sing it, mix and master the tune for $200.

From my perspective they got a good, fair market rate deal at $2000.

Are video editors now editing for $3 an hour over in Indonesia taking away market share from USA editors ? LOL!

[echoflex]

Again, I agree with you 100%. They did get a deal, it’s just sad what composers are expected to do for so little. And so it is shocking when I hear that anyone gets paid. It is the only thing that gives me hope. I think you might have taken my statement as an insult to your skills or worth – completely not what I was saying. Conversing on the internet is such a drag at times….

And to your question about editors in Indonesia, yes, MEGA cheap rates. You will find people offering services as low as $5 a project. Of course some of them are horribly unskilled, but there are many that appear to know what they are doing. Only paying them for a project and seeing the result will tell.

[Author]

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