The Cost Of Producing Stock

Posted on 2/5/2014 by Jim Pickerell | Printable Version | Comments (1)

A couple weeks ago I proposed an adjustment to current agency pricing strategies that offers the potential to get higher prices for the images in greatest demand and still make large quantities of excellent images available to customers who can’t afford the best. (See “Solving The Problem Of Too Many Images”) Some subscribers thought I should also factor in production costs. Here's my response.


Get the Full Article (2 Credits)

Have an Account?

Access to this site is an exclusive benefit for you. Enter your username and password in the form above. If you don't remember your password you can reset it at any time.


Forgot your password?

New to Selling Stock?

Selling Stock is a subscription based on-line newsletter that reports on developing trends in the stock photo industry. It is updated at least twice a month. On-line subscribers receive e-mail notification whenever new stories are posted. Archives containing stories going back to late 1995 are fully available to subscribers.


Copyright © 2014 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 www.selling-stock.com, 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: http://www.jimpickerell.com/Curriculum-Vitae.aspx.  

Comments

  • Tom Zimberoff Posted Feb 8, 2014
    "The agencies believe there will always be enough amateurs producing images that will satisfy the needs of their customers." Your comment, Jim, is certainly not the view of photo buyers. And by "buyers," I do not mean plumbers, dentists, bloggers, and designers looking to fill up Web sites with cheap content; but Ad agencies, Corporate communicators, Editorial media, and Small business (doing more than a $3M run rate).

    On the next issue you raised, cost of production, you wrote, "As far back as I can remember stock agencies have never taken the costs of producing images into account." Well, of course, that's because they had no direct data connection—and still do not have—with creators, say, in the cloud by which they could factor in creative costs balanced with buyer budgets utilizing predictive data analytics. Even so, the incumbent distributors deliberately chose, years ago, to serve only buyers—consumers at that—by employing low prices and volume sales. The photographers' costs were not only purposefully ignored but they, themselves, were cut out of the value chain. That was a business decision, not an unexpected result. Anyway, today, technologically, there is no difficulty at all in factoring in production costs into stock photo sales. Only the will to do so is lacking. Despite your saying, "That kind of communication between producer and the person negotiating the rights no longer exists. And, it cannot be reestablished in the high volume, time sensitive, Internet sales environment," is simply not true. It's quite straightforward to accomplish—transaction by transaction in real time.

    Finally, FotoQuote is likely the singularly most pernicious, dead weight on prices because it's based on guesses. Okay call it a survey. However:

    ? Surveys do not always account for more than a basic usage fee, yet there are usually additional kinds of fees and costs to consider in the bottom-line price of a photo shoot.

    ? Surveys can be skewed by the number of respondents, which may include only a small percentage of those photographers who were actually polled.

    ? The survey respondents from one regional market may outnumber those in another. If you’re not given that information, the survey will be tainted and misleading, because what might be a tantalizingly high fee in Schenectady might be low by New York City standards.

    ? Surveys become out of date as quickly as prices are susceptible to change.

    ? Buyers use survey results to keep a cap on usage fees.

    ? Finally, surveys do not single out photographers who have used best practices to determine pricing and profit structures. Consequently, any carelessness on the part of the respondents (especially the fewer there are) will lead to artificial prices, whether biased on the low side or the high side. You have no way of knowing how many, if any, of the respondents regularly mark up their billed expenses, let alone whether they billed any expenses at all. And you have no idea what their actual costs are.

Post Comment

You must log in to post comments.

Stay Connected

Sign up to receive our FREE weekly email listing new stories posted.

Follow Us

Free Stuff

Future Of Stock Photography
If you’re a photographer that counts on the licensing of stock images to provide a portion of your annual income the following are a few stories you should read. In the past decade stock photography ...
Read More
Blockchain Stories
The opening session at this year’s CEPIC Congress in Berlin on May 30, 2018 is entitled “Can Blockchain be applied to the Photo Industry?” For those who would like to know more about the existing blo...
Read More
2017 Stories Worth Reviewing
The following are links to some 2017 and early 2018 stories that might be worth reviewing as we move into the new year.
Read More
Stories Related To Stock Photo Pricing
The following are links to stories that deal with stock photo pricing trends. Probably the biggest problem the industry has faced in recent years has been the steady decline in prices for the use of ...
Read More
Stock Photo Prices: The Future
This story is FREE. Feel free to pass it along to anyone interested in licensing their work as stock photography. On October 23rd at the DMLA 2017 Conference in New York there will be a panel discuss...
Read More
Important Stock Photo Industry Issues
Here are links to recent stories that deal with three major issues for the stock photo industry – Revenue Growth Potential, Setting Bottom Line On Pricing and Future Production Sources.
Read More
Recent Stories – Summer 2016
If you’ve been shooting all summer and haven’t had time to keep up with your reading here are links to a few stories you might want to check out as we move into the fall. To begin, be sure to complet...
Read More
Corbis Acquisition by VCG/Getty Images
This story provides links to several stories that relate to the Visual China Group (VCG) acquisition of Corbis and the role Getty Images has been assigned in the transfer of Corbis assets to the Gett...
Read More
Finding The Right Image
Many think search will be solved with better Metadata. While metadata is important, there are limits to how far it can take the customer toward finding the right piece of content. This story provides...
Read More
Where Is The Stock Photo Industry Headed?
For new readers, or those who may have missed some of what I have written over the last few months, the following are a list of stories worth looking at to get a sense of where the industry is headed.
Read More

More from Free Stuff