- What people mean when they ask this question
- The four real cost tiers, with actual numbers
- A real example: what it cost one of my clients
- The uncomfortable bit most guides skip
- Budgeting by what you're making
- Monthly budget ranges by business size
- Where to save money
- Frequently asked questions
- Official documentation
The short version: for a small business doing its own AI video, budget £30 to £150 a month in tool subscriptions plus four to six hours of someone's time per video. For anything client-facing or ad-spend-backed, budget £300 to £3,000 per finished video once you include a human editor to fix what the AI gets wrong. The tool is never the expensive bit. The clean-up is.
What people mean when they ask this question
Most people asking "how much should I budget for AI video" have already seen a demo of Sora, Runway, or HeyGen and assumed the monthly subscription is the whole cost. It isn't. I've watched three separate clients set aside £29 a month for a tool, produce their first AI video, and then come back to me two weeks later asking why it still took eight hours and cost more than filming it themselves would have.
The subscription is real money, but it's the smallest line in the budget. The bigger costs are generation credits (which run out faster than the marketing pages suggest), the editing time to fix glitches, and, if you want anything that doesn't look like every other AI video on LinkedIn, a person who knows what they're doing behind the prompt.
The four real cost tiers, with actual numbers
Tier one: DIY with a free or entry tool
Cost: £0 to £15 a month. Tools like Pika, Luma Dream Machine's free tier, or Canva's built-in AI video feature will get you short social clips, but the free tiers are stingy: usually 3 to 5 minutes of generated footage a month, watermarked, capped resolution. Fine for testing the waters. Not fine for anything you'll put money behind. This is the tier for someone who wants to understand how text-to-video tools work before spending anything real.
Tier two: A proper subscription, DIY
Cost: £25 to £90 a month. This is where most solo business owners and small marketing teams should sit. Runway's Standard plan runs around £12 a month for 625 credits, but you'll burn through those in a single afternoon of experimenting, so most people end up on Pro at £28 to £35 a month. Synthesia's Starter plan is £26 a month for 10 minutes of finished video, which sounds generous until you realise a 10-minute training video usually needs 25 to 40 minutes of raw generation to get one good take. HeyGen sits around £26 to £42 a month depending on avatar minutes. Add ElevenLabs for voice at £4 to £18 a month if the built-in voice options sound as robotic as they usually do.
Realistic monthly spend at this tier for a business making 2 to 4 videos a month: £60 to £150, tools only.
Tier three: DIY tools plus a freelancer to fix and finish
Cost: £300 to £1,200 per month, or £75 to £250 per finished video. This is the tier nobody talks about enough. You generate the raw AI footage yourself, then pay a video editor £30 to £75 an hour to fix lip-sync drift, smooth out the uncanny bits, add real branding, and cut it to platform length. A freelance editor comfortable with AI-generated footage typically needs 2 to 4 hours per finished video, because AI clips need more correction than a normal camera shoot, not less. If you're trying to work out what these roles are even called when you're hiring, the different job titles under video marketing are worth a look before you post a job ad for the wrong role.
Tier four: Fully managed AI video production
Cost: £800 to £3,500 per finished video, or £2,000 to £8,000 a month for an ongoing agency retainer. This is what larger brands and anyone doing paid ad creative should expect. It includes strategy, scripting, multiple AI generation passes, human editing, sound design, brand compliance checks, and usually two to three rounds of revisions. If a business quotes you £150 for this level of finished product, that's a red flag, not a bargain.
A real example: what it cost one of my clients
A coaching client of mine, a two-person consultancy, wanted to replace a £4,000 filmed explainer video with an AI version. Their first attempt: £29 a month on HeyGen, done entirely in-house by the founder. Three weeks and roughly eleven hours of her time later, she had a 90-second video with an avatar whose mouth movements didn't match the audio in four places and a background that flickered oddly whenever she used a hand gesture in the script.
We redid it. Same HeyGen subscription for the raw generation, but I brought in a freelance editor at £45 an hour who spent three and a half hours cleaning it up, resyncing audio, and cutting a tighter script. Total cost: £29 tool subscription plus £157.50 in editing, so £186.50 against a £4,000 filmed alternative. That's a 95% saving, and it's the number that matters here: not "AI video is free" but "AI video with the right human input costs about 5% of traditional production."
The founder's mistake wasn't choosing AI. It was assuming the tool alone would do the job a human normally does. That gap between what the tool promises and what it delivers is exactly where budgets need padding.
The uncomfortable bit most guides skip
Here's what nobody wants to say plainly: AI video creation is currently cheaper than traditional filming, but it is not cheaper than a well-shot phone video plus a decent editing app, once you count the hours spent wrestling with prompts, regenerating failed takes, and paying someone to fix the parts that still look wrong. If your business just needs a talking-head update or a simple product walkthrough, a £200 phone gimbal and forty minutes of your own time will often beat AI video on cost, speed, and quality. AI video earns its keep when you need volume (dozens of localised ad variants, product videos in twelve languages, avatar-led training modules at scale), not when you need one good video for your homepage.
I say this as someone who sells AI consulting for a living: the honest budgeting advice is to match the tool to the job, not the hype cycle. A lot of the money wasted on AI video budgets this year has gone toward businesses forcing AI into jobs a £15 app or a smartphone would have handled better and cheaper.
Budgeting by what you're making
Break your budget down by video type, because the cost per minute varies wildly:
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- Social media clips (15 to 30 seconds): £10 to £40 per video if DIY on a subscription tool. Batch these, since generating five variants at once barely costs more than one.
- Product demo or explainer (60 to 120 seconds): £150 to £500 per video with a freelancer's finishing touch, up to £1,500 with an agency for anything customer-facing.
- Training and onboarding videos: £200 to £600 per video, cheaper per video the more you make in one batch because scripting and avatar setup is reusable.
- Paid ad creative: £500 to £3,500 per finished ad, because ad platforms punish poor-quality creative with higher costs per click, so the budget for polish is not optional here.
If your team already juggles five or six marketing tools and you're adding AI video on top, it's worth checking whether your marketing tech stack is already costing more than it should before adding another subscription line nobody uses past month two.
Monthly budget ranges by business size
These are realistic monthly figures, not aspirational ones:
- Solo founder or freelancer: £30 to £100 a month, tools only, DIY.
- Small business, 2 to 4 videos a month: £150 to £500 a month including some freelance editing time.
- Growing business with a marketing person: £500 to £1,500 a month, mixing subscriptions, a freelancer on retainer, and occasional agency-quality pieces for launches.
- Mid-size company running regular paid campaigns: £2,000 to £8,000 a month, usually with an agency or in-house video specialist involved.
Whatever tier you're in, choosing the right tool matters more than people think, because switching costs later (retraining your team, rebuilding your prompt library, redoing brand assets) is real money too. It's worth reading through how to choose the right content creation tool for your brand before you commit to a year's subscription.
Where to save money
Cut costs in the right places. Don't cut the human editing time; that's what stops your video looking like every other AI clip on the internet. Do cut:
- Annual subscriptions before you've tested a tool for at least one full project cycle. Monthly plans cost more per month but save you from a year-long commitment to a tool that doesn't fit.
- Custom avatars and voice clones unless you're producing videos weekly. A stock avatar at £26 a month beats a custom one at £150 to £500 setup if you're only making four videos a year.
- Multiple overlapping tools. Most businesses only need one generation tool and one editing tool, not four subscriptions doing similar jobs.
And if you're pricing this out for clients rather than your own business, the same logic that applies to what to charge for social media management applies here: price the outcome and the time, not the tool cost, because clients are paying for a finished video, not for your HeyGen login.
Related: content creation tools.
Frequently asked questions
Is AI video cheaper than hiring a videographer?
Yes, usually, once you factor in editing time. A traditional filmed explainer video runs £2,000 to £5,000; the AI equivalent with proper human editing typically costs £150 to £500. The gap closes fast for anything needing multiple people or real locations, where filming can still win on time.
What's the cheapest way to make an AI video that still looks professional?
Use a mid-tier subscription tool like HeyGen or Synthesia at £26 to £40 a month, then pay a freelance editor £75 to £150 to fix and finish one video rather than trying to make the raw output presentation-ready yourself.
Do AI video credits really run out that fast?
Yes. Most platforms count every generation attempt against your credits, including the ones you throw away. A 60-second finished video often needs 3 to 6 generation attempts, so budget your credit tier for at least double what the finished video's length suggests.
Should a small business hire someone to manage AI video or do it in-house?
Under 4 videos a month, in-house on a mid-tier tool works fine. Above that, or for anything tied to paid ads, a freelancer or small agency on retainer at £300 to £1,200 a month pays for itself in saved time and fewer botched first attempts.
