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Stock Connection
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Pricing Guide: Forward
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This book is for sellers of stock photography, both individual photographers and stock
agents, with an emphasis on what is best for the photographer. It is designed with two
purposes in mind.
The first is to aid sellers of Rights Protected images in establishing fair prices for the
use of their images in a very competitive environment. It is also aimed at training them in
the use of negotiating techniques that will result in a win-win situation for both the
seller and the buyer. For those who are only interested in this aspect of the book you will
find most of what you need in chapters 13 through 16 and the yellow pages.
In this fifth edition every base pricing number has been reviewed and updated based on the
recent experiences of photographers and stock agencies, and particularly on the experience
of the stock agency we own, Stock Connection.
The numbers are not fixed fees for various usages, but a starting point for calculating a
price. They are reasonable fees for a single usage of an average image in the particular
category of use. The numbers assume that the image is of high quality, but not unique. Every
image and every usage has unique characteristics.
As a result the Rights Protected seller needs to carefully negotiate most deals, in order to
obtain a reasonable return for the time and energy invested in producing the image. Fixed
pricing is seldom satisfactory in this industry that licenses rights to the creative talent
of individuals.
The second purpose is to take a look at the state of this rapidly changing and confused
industry as of August 2001. We believe that you can not properly price image usages without
a thorough understanding of the overall business environment.
In an organized way, we have tried to examine industry developments in recent years and
outline where we think the business is headed in the near future. It is clear that producing
and selling stock images will be a different business in the future from what it was in the
past.
Some photographers should expect stock sales to become a much smaller part of their total
photography business. For others the introduction of new technology will provide new and
improved opportunities for greater satisfaction and earnings from the production and sale of
stock images.
The bulk of this discussion is found in chapters 1 through 11. Chapters 17 through 23 in the
back of the book examine certain important industry issues in much greater depth.
We are often asked if the numbers, and the principles espoused in this book apply to
amateurs as well as professionals. The answer is yes, they are as valid for an amateur who
licenses rights to one or two photos a year as for any professional. A stock image, by
definition, is one that already exists. There is no question as to whether the amateur has
the ability to produce what is needed. The price is based on the value the customer
receives. If the image fulfills the needs of the customer then it makes no difference
whether the image creator is a part-time amateur or a professional.
Back to negotiation for a minute. Keep in mind that negotiation implies a give and take
discussion. The seller should attempt to find the highest price to which the buyer can
readily agree and then decide if that figure is acceptable. The seller must do this, not out
of greed, but in order to serve the customer. In addition to a reasonable price, the
customer needs for the seller to maintain a viable business and continually improve the
quality of the product.
One of our great complaints with the Royalty Free pricing strategy is that it often leaves
huge amounts of money on the table that the buyers would have willingly paid, if only they
had been asked.
While this provides an instant benefit for the buyer, it can cripple image producers and
sellers. Eventually, some of the most creative of these sellers will leave the market for
greener pastures. This will leave future buyers with limited choices. Since the people who
are currently buying are likely to be the same people who will be buying in the future, it
is an important consideration for current buyers. Never the less, the long term economics of
the situation are often hard for current buyers to see and understand.
This idea that production costs are not a factor and everything has to be cheap, or near
free, is an outgrowth of the dot-com mania. As we can see from a 2001 perspective, it is not
necessarily beneficial to build companies that disrupt the normal buying and selling chain
only to then crash and burn before they ever make a profit. Forgetting what it does to the
investors, it is not beneficial to many of the people who worked for these companies and are
now unemployed. It is not beneficial to the buyers who get used to having certain products
and services, and then suddenly have to get along without them. And it is not beneficial to
the smooth flow of commerce to have huge peaks and valleys. But it is a reality that we must
live and work our way through.
The peaks and valleys are particularly difficult when they occur in an industry where it
requires a huge amount of time to develop new creative talent and bring new production on
stream once the old producers have been lost. Stock photographers are not part of an
assembly line where older, experienced workers are easily replaced with new bodies whenever
it is time to tool up.
There is reason for optimism, and to believe we are almost through the worst of times, and
that, just over the horizon, the future is looking a lot brighter. This book will explain
the reasons for that optimism and how to position your business to take advantage of it.
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