At the annual CEPIC Congress, this year in Istanbul, where stock photo agents and distributors from around the world meet, I asked attendees the following and agreed to enter the names of those who answer into a drawing for a chance to WIN $100.00.
Describe a situation where a fee of $10.00, or less, is justified for the COMMERCIAL use of a single image?
I acknowledged that $10.00 or less might be reasonable for uses by individual students for school reports, or for personal purposes like an individual’s blog. After all songs downloaded by individuals are available for $0.99 through iTunes. With the right restrictions low fees for certain personal use of images might be more than justified. And in some cases the volume of such uses could be substantial. In my view such personal uses are “commercial” if they generate any revenue at all. Are you willing to license your images for such uses?
The contest deadline is June 12, 2011. I’m inviting Selling-Stock subscribers to also participate in this contest. All you need to do to become eligible to win the $100.00 is email your answer to the question, along with contact information, to firstname.lastname@example.org. There will be a random drawing and every respondent has an equal chance to win regardless of their answer.
If under no conditions will you ever license rights to your images for $10.00, I also want to hear from you. Tell me your bottom line price and describe the use you will allow for that figure. I’m looking for serious answers, but humorous ones are also acceptable. One of the early respondents said he would only charge $10.00 to use one of his photos on a tombstone, pointing out that in many cemeteries relatives of the deceased place photos of their love ones on tombstones. He is even willing to grant unlimited future rights for this use.
However, one thing to be considered if you’re going to sell for low prices is that there should be a reasonable chance to make a volume of sales of the same image for the low price. I doubt if that will be the case for pictures on tombstones!
Another respondents argued that the word “justified” put an unfair qualification on the question. He argued that “any fee agreed upon between a willing buyer and a willing seller is reasonable and therefore justified.” He went on to point out that no seller would agree to sell below his costs, except in a “loss leader” transaction designed to generate other business.
While in pure economic theory the above is true, it does not hold up in the stock photo business given the relationship between distributor and producer. The distributor, not the producer, sets the price. Usually the distributor has no understanding whatsoever of the producer’s cost. The distributor can sell at a price where his share covers his costs. But the producer’s share may not be enough to begin to cover his costs. The only alternative for the producer in this case is to cut costs to the bone, or go out of business. Meanwhile the distributor may go on selling the products of other producers below their cost of production and recruit new, unknowing producers to replace those who drop out.
I want photographers to begin to share ideas on this issue. Are there some segments of the business where the potential volume justifies making certain images available at low prices? It certainly appears that business to large business sales are diminishing. The market that is growing is business to small business and business to consumers. Of course, there has always been a business to consumer market in portraits and wedding, but for this type of subject matter there is a very limited number of potential customers for any particular set of pictures. Therefore, prices for these pictures need have always needed to remain high in order to cover costs.
However, there are new, developing markets where a high volume of consumers are interested in the same, or very similar images. Individual Customers cannot justify paying high prices for the small, personal uses they intend to make of the images. But the volume of potential sales may be a business worth considering. The question for photographers is whether they are willing to make some of their images available to this market for minimal fees and pursue a volume sales strategy.
I look forward to getting a variety of ideas.