Getty's Customer Facing Structure

Posted on 7/28/1999 by Jim Pickerell | Printable Version | Comments (0)



July 28, 1999

Getty Images, Inc. has announced an internal re-organization to focus on

e-commerce solutions for distinct customer segments of the market. It will

arrange its seven distinct brands into four customer-facing divisions that will

address the needs of the Company's four key markets:

    Creative Professionals,

    Editorial & Press Businesses,

    Business User Market,

    Consumer Market.

This move is the first step in Getty Images' evolution from a group of separate

companies to a fully-integrated company with four customer focused divisions

comprised of market leading brands. One of the challenges will be to structure

the online databases of their various supplying units so all brands can be

searched simultaneously. Currently each company brand has a unique database

structure with those of PhotoDisc and TSI being closest to integration.

The re-organization is also intended to accelerate the integration of the

companies and collections that Getty Images has acquired since its inception in

March 1995. The goal of this new structure is to enable Getty Images to better

tailor solutions to meet the unique needs of each market segment.

In an effort to identify other market segments that Getty is not currently

servicing, they have hired Roger Ressmeyer on an open ended contract to analyze

the potentials and create plans to acquire and develop specialist collection in

areas not fully serviced by the company's existing divisions. All sources of

leading imagery will be considered, including licensing and acquiring material

from new photographers and agencies, and/or producing fresh photography with the

company's large complement of world class photographers. Roger will report

directly to Mark Getty and Nick Evans-Lombe.

In the new structure hub sites will be created for each of the customer

segments. The first for the creative professional market is expected to begin

later in 1999. These hub sites will form the basis for the third phase of the

strategy, the launch of market-specific, vertical hub sites that will expand the

Getty Images product and service offering beyond imagery to complementary

products and services tailored and targeted for each customer group.

"This logical segmentation of our market leading brands provides us with a more

cost-effective and responsive corporate structure that is more closely aligned

with how our customers work," said Jonathan Klein, co-founder and Chief

Executive Officer of Getty Images. "We expect this to lead to stronger

relationships with customers and greater flexibility with internal resources.

This new structure will also allow us to accelerate our efforts to use the web


broaden our market and further increase our market share while catering to the

specific needs of our customers."

Things To Consider

From the photographers point of view there are several things to consider.

  • Many photographers produce images that will be of interest to several

    markets. Getty's current system of editing slots each photographer into a certain style

    of work based on an agency "brand". The various Getty agencies are doing a

    very poor job of editing submissions with

    an eye to ALL the potential market segments Getty services.

    In particular, TSI which used to be very strong in selling

    to the book publishing market has basically stopped accepting images of the type

    used by this market. This is understandable if they have decided that they want

    to "brand" TSI as the agency for "Creative Advertising Professionals" and move

    it away from the editorial market. But they have not explained this change in

    strategy to their photographers who shoot the textbook type of imagery, nor

    have they offered these photographers an alternative place to put

    their images.

    They have hired Mr. Ressmeyer to "identify market segments they are not

    servicing." But, at the same time they give the appearance of moving away from

    certain markets in which they had a strong position. They are chasing potential

    suppliers to those markets to other agencies outside the Getty family.

    When Getty acquired Liaison, an agency focused on editorial production for hard

    news and feature uses, they transferred a number of Liaision photographers who

    produced some advertising oriented work that would be of interest to the

    "Creatived Professionals" to TSI editors.

    Initially, a few images made it into the TSI catalogs, but now many of these

    photographers are finding that the bulk of their editorially oriented work is

    not even being considered for the files. Many photographers would like to find a way to go

    back to Liaison editors because they feel in the long run they would earn

    more by licensing rights to the bulk of their production, than by hoping for

    a few high end sales to "Creative Professionals."

    Because the

    potential market for many photographer's work is much broader then any of

    Getty's particular "brands" images that would sell are being rejected and the creativity

    of photographer's is being constrained. Getty has given no evidence of

    recognizing, or solving this problem.

  • It is clear that buyers don't always go to the right brand in their search

    for images. Thus they often fail to see the best options. TSI outsells

    Liaison to some editorial markets. Buyers call Liaison for sports celebrity

    photos and fails to consider AllSport as an option. Buyers may go to Liaison for

    editorial illustrations when TSI might have a better selection. Thus, a search

    capability that gives users the opportunity to search across all brands is

    certainly desirable. [It should be noted that Picture Network International

    and The Workbook already have on-line sites that accomplish this goal for many

    more brands than Getty is offering.]

  • Integration may make it more difficult to make distinctions on price.

    There may be more pressure to sell high-end images at RF prices. When the

    "Creative Professional" comes to a single source for both PhotoDisc and TSI

    images it may be hard for the salesman to explain why some images should be

    priced several times higher than others. If the client is looking for

    restricted rights, that is certainly one distinction. But only a small

    percentage of the clients who are paying higher fees to other agencies for RP

    images do so because they want restricted uses. Often the higher fees result

    from larger usages in both size and circulation.

    The PhotoDisc model does not take size and circulation factors into

    consideration and the salesman selling images from both sources to the same

    client may find it very difficult to justify wide price variations. TSI has

    already compressed their pricing structure when it comes to charging more for

    larger sizes (See story 218).

    Photographers should expect to see TSI pricing

    move closer to that of PhotoDisc as the two companies are brought closer together.

    If this happens, it does not necessarily mean that all other agencies will be

    unable to get high prices for RP uses. Currently, other agencies competiting

    with TSI frequently get higher prices for images of a similar look and quality

    than TSI is asking. They accomplish this because they do not offer RF images,

    and they present a different pricing strategy and focused sales philosophy to

    the customers.

    By analogy, ready to wear

    clothes do not eliminate the demand for custom designs, and clothes that are

    more tailored to the customers needs, although the volume of sales for custom

    designs may be lower. The customer who buys clothes at K-Mart expect K-Mart

    prices for everything they buy there. When they want Nordstrom quality and

    service they go to Nordstrom.

  • As far as I can see the "Business Use Market" wants exactly the same types

    of images as the "Creative Professionals," except that they hope to get them for

    a whole lot less money.

    There is no justification as to why these uses should cost less in terms of less

    production costs, more frequent use or reduced marketing costs. The only

    justification is that the buyer wants to pay less.

    The big risk for the photographer is that all the "Creative Professionals" will

    go to the "Business Use" site to buy their images. It's smart business for the

    buyer to try to get the lowest possible price, especially if you can get exactly

    the same products at that location. (The K-Mart strategy again.) But will the

    producers of the products be able to earn enough to continue to produce?

    It may be Getty's hope to solve the pricing difficulties by only allowing low

    end users in through the "Business Use" hub, and encouraging "Creative

    Professionals" to use a different hub. If that is the strategy, I doubt it

    will work. If the user can truly search across all databases by coming in

    through any hub, I believe users will quickly discover the lowest priced hub.

  • With Steve Powell as interim CEO at Liaison, photographers should expect to

    see at least two moves in the near future. First, there is likely to be a move

    to change the royalty percentage from 50/50 to 60/40 with the 40% going to the


    In addition, I expect to see Liaison begin to hire staff photographers to cover

    high demand events as AllSport has done so successfully. This will give Liaison

    more control over content production and a larger share of the fees collected

    for usages. The work they continue to take in from freelancers, if they

    continue to accept any at all, will be on marginal stories that the company

    deems too speculatives to fund themselves.

  • Greater integration will make it easier for Getty to offer bulk deals to

    high volume customers based on the customer's total buy on an annual basis.

    Such deals tend to give customers like Time-Warner, CNN, MSNBC, Disney, General

    Motors, MCI, etc. across the board price breaks on an item by item basis. Such

    deals are suppose to increase the volume of usage for the agency, but individual

    photographers don't necessarily see a corresponding increase in volume. This

    will be even more true for individual photographers as a larger percentage of

    Getty imagery becomes wholly owned.

  • Copyright © 1999 Jim Pickerell. The above article may not be copied, reproduced, excerpted or distributed in any manner without written permission from the author. All requests should be submitted to Selling Stock at 10319 Westlake Drive, Suite 162, Bethesda, MD 20817, phone 301-251-0720, e-mail: wvz@fpcubgbf.pbz

    Jim Pickerell is founder of, an online newsletter that publishes daily. He is also available for personal telephone consultations on pricing and other matters related to stock photography. He occasionally acts as an expert witness on matters related to stock photography. For his current curriculum vitae go to:  


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