The major agencies talk about how important their DATA is and how it has changed the industry. They argue that the company with the most and best data will be the winner. But I don’t think they are really looking at much of the data they have collected – or looking at it in the right way.
I would challenge them to compare the data they have for the year’s 2006, 2010, 2014 and 2016 on the following topics. It would be lovely if they would share the results with contributors, but at the very least they should be reviewing the information internally.
1 – Images available in the collection
2 – Total Images licensed
3 – Unique Images licensed
4 – Average royalty per image in the collection
5 – Images never looked at by anyone in the previous two years
When I use the term “major agencies” I’m referring specifically to Getty Images, Shutterstock, iStock (it should be viewed separately from other Getty properties), Alamy and to a degree Fotolia/AdobeStock although their figures may not be as relevant.
1 - Images In The Collection
Everyone is focused on growing their collections, but do you earn more just because you have more product? While Shutterstock, at least, can point to sustained revenue growth during the period in question, is the growth in proportion to the size of the collection? For example, Shutterstocks average revenue pre-image-in-the-collection in Q3 2014 was $1.96 and by Q3 2016 it had steadily dropped a total of 39% to $1.20. (See
chart.)
The agencies often seem to forget that the purpose of the exercise is to grow revenue, not just have the largest collection. Granted, it is difficult to determine, in advance, what images will sell, but just adding everything and hoping for the best may not be a workable solution long term.
2 – Total Images Licensed
So how many total images have they licensed each year? Were those numbers increasing at the same rate as the collection was increasing? Was it necessary to reduce prices in order to maintain the same number, or a slightly increased number, of sales?
Clearly, since 2010 Getty and iStock have been forced to reduce prices. Despite these price reductions their gross annual revenue has fallen. It is unclear whether they were actually able to increase unit sales as a result of lowering prices, or whether sales remained stable or fell.
3 – Unique Images Licensed
Maybe more important than the number of images licensed is the number of unique images licensed. We know that some images are licensed very frequently. What makes many customers want to use the same image? Are the new images they are bringing in the kind of images that might appeal to customers in a similar way to those that have already sold?
iStock used to allow customers to not only search by “most popular” but to also see how many times each image had been downloaded. This information was extremely useful to image creators and my also have been helpful to customers. Many images were used hundreds of times. Images that hit 1,000 downloads tended to be used in the future at an even more rapid rate. At least one image in the collection was downloaded more than 25,000 times. What are the characteristics that make such images so successful?
One of the reasons they may have eliminated this option is that photographers were looking at the successful images and copying them, or at least copying the style and general subject matter. Photographers who produced the originals complained because they lost sales to the new competition. But, is it better for the agency, and photographers in general, to produce more of what customers want to buy, or flood the collections with images that are of no interest to anyone? This flood of images just tends to make it harder for customers to find what they really want.
4 – Average Royalty Per Image In The Collection
Agencies should be looking at lot harder at the amount each photographer is earning per image in the collection. They want image creators to produce more new content, but each one of those new images costs the creator time and money. If the agencies would look carefully they would find that very few of their photographers are seeing annual revenue growth per image in the collection. For most, the only way they get growth is to flood the collection with new images and hope.
Not only are they not seeing growth, but most are seeing significant declines even when they are working very hard to produce new images.
If agencies want long term success they’ve got to find a way to help – at least their major producers – to be more successful.
Yesterday, I did a
story on iStock that showed that a significant and growing percentage of the agency’s top producers are slowing production, or stopping it altogether. These people know how to produce imagery customers want to buy, but they are not going to do it if it is not profitable.
Granted, the agencies may not be able to justify the expense of spending time advising all their thousands of photographers, but for relatively little cost they could provide more useful information in terms of what selling and what isn’t.
Maybe they only give this additional support to the top 1% or 2% who have proved they are the best producers. I don’t think that’s happening. And they are losing people because they are ignoring this option.
One the things that works against this for some is that they are afraid that when the photographers learn how to produce more effectively they will give the production to their competitor and the agency won’t get all the benefit. But as it stands now the agency isn’t generating enough revenue for the photographer to justify continued production.
Maybe the agencies have decided that they don’t need people who will invest in high production value shoots and that amateurs who are unconcerned about profit will supply them with everything they need. If that is their assessment, I suspect they have not examined their data closely enough.
5 – Images Never Reviewed By Any Customer In Last Two Years
They should not only know how many images are delivered in a search return. However, the key issue is not the number delivered, but the ones that are actually seen by customers.?
For example: I searched for “woman, smiling, office, computer” on Shutterstock and got 136,138 returns. Obviously, no customer is going to look at all these images. The agency should know which images are on pages 1,2,3 etc. and how many pages the customer reviews before they move to another search. That should tell them which of the 135,000+ images delivered in this search were not possibly reviewed by the customer.
Given the number of images that are used by multiple different customers my guess is that a significant percentage of Shutterstock’s over 100,000,000 images (maybe as much of 50%) have never been reviewed by any customer in the last two years. The same is true for all the big databases.
It that’s the case, what’s the point of keeping such images? Are the ones that are seen really the best images in the collection, or do they just happen to be, mostly, the newest? Is newest always better (particularly from a customer point of view)? Is it fair to the image creators to bury their work?
Why not do something else with these images to try to get them seen and earn a little money? How about placing them in a separate database and making them available at a discounted price?
What I would really like to see is to take the images that haven’t been seen for a while and turn them into the subscription offering. The ones that are in high demand should only be available for single image licensing. But, that is probably too much to hope for.
For more thoughts on this subject see:
Big Data: Is Anyone In the Stock Industry Paying Attention.