Direct Selling vs. Agency Selling

As you know, since you run into it all the time at Stock Connection, the stock
photography industry as a whole does a terrible job of holding out for good prices.
And let me make it clear right here that by "the stock photography industry" I do
not mean just stock agencies, but also the many hundreds of photographers who sell
their work direct. In fact, some of the worst offenders in the lowball pricing derby
are photographers themselves, who too often seem determined to shoot themselves in
the foot.

At my agency, Natural Selection, we are constantly vexed when clients tell us "Your
prices are much too high; we can get that picture from (somewhere else) for ...,"
and then they name a price about half to one-third of what is fair based on
established industry guidelines such as your pricing handbook, FotoQuote, etc. Like
Seth, we maintain a high average (as I know Stock Connection does). Last year we
billed an average of $1024 per image. But we understand from the reactions and
attitudes of our clients that many if not most other stock picture sources are
quoting much lower prices.

Of course, there are many levels to the stock photography business, and many picture
sellers seem to insist on competing with each other for the bottom end of the
market. (Perhaps this is because the quality of their files is unsuitable for the
higher end.) With everyone trying to sell pictures to textbook publishers, for
example, it is no wonder that prices have remained low for this segment of the
market. We refuse to sell anything for less than $300, and we generally limit our
textbook sales to covers, chapter openers and the like, for which publishers are
willing to pay real money. Last week, for example, we invoiced three textbook covers
for $1150 each. This is worth our time, and does a service to the photographer.
Selling pictures for $200 or less does nobody any good and actually causes great
harm.

I think a big part of the pricing problem is that many stock agencies and stock
photographers are desperate (or at least lacking in confidence) and are therefore
willing to give buyers the right to set their own prices rather than lose a
potential sale. It is particularly sad for us to find ourselves "bidding" against
photographers who are determined to give away their work for far too little. I
remember a sale last year where we quoted one picture (out of five the client was
buying) for about $18,000 (multi-year unlimited usage), and the client told us that
another picture in the campaign was being quoted by the photographer at about $1500.
We had to come down in our price because of his lowball bidding -- but we still got
about $14,000 for our picture while he was willing to settle for little more than
one-tenth that amount. How nice it would have been for everyone if each picture had
gone for the fair price of $18,000. It could have happened if the photographer had
had the courage and intelligence to use industry standard pricing guidelines.

This attitude of undercutting has done a tremendous disservice to everyone in the
business. But I do not see any value in pointing fingers at stock agencies, since
stock photographers are equally to blame for "training" picture buyers to expect to
set the prices based on their budget (no matter how unrealistic), rather than on
their usage. The bright side of all this is that the lowballers (agencies and
photographers alike) are not likely to be around much longer, and that will be good
news for the stock photography industry.