Portal or Print?

Posted on 10/19/2001 by Jim Pickerell | Printable Version | Comments (0)

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PORTAL OR PRINT



October 19, 2001

One of the big questions for people trying to sell Rights Protected stock in the United States
is what is the best way to promote the work -- a portal, or a print catalog.


If you're flush with money you do both. Will all those who are flush with money in this
economic environment please identify themselves.


How Effective Are Online Catalogs?


In Random Thought 38 (Story 427 )
I laid out what we currently know about online sales and came
to the conclusion, based on year 2000 sales figures, that 37% of the revenue from U.S. stock
photo sales resulted from images being found on the web.


A recent Corbis Stock Market survey determined that the MAJORITY of art buyers and graphic
designers in the U.S. go to the web first when looking for images.


Getty's revenue from images found online was 46% of their total revenue in the 2nd Quarter of
2001, up from 42% of total revenue in the 1st Quarter.


In February 2001, 58% of Masterfile's North American sales came from customers finding the
image on their website. That percentage had been rising every month since they set up their
site. As of August 2001 it was almost 75% of sales. This includes images that are in the print
catalogs, but the images were ordered online.


Print Catalog Sales


Given the above numbers, and considering that 10% to 20% of total revenue in the U.S. market
still comes from images being found as a result of general file search, something in the range
of between 25% and 40% of total revenue may continue to come from images found in print
catalogs.


While down from the 70% to 80% of revenue that resulted from print catalog image sales a few
years ago, 25% to 40% is still significant.


However, remember that current sales from print catalog come from the combined total of all
the print catalogs that have been put into the marketplace in the past decade or so, not just
the ones that have come out in the past year. A certain percentage of buyers need very current
imagery and will reject anything that is slightly out of date. But many images in older
catalogs still continue to sell better than the images in the new edgier catalogs. This means
that the market share for new images, from new prints catalogs, is only a fraction of the
percentages above.


Thus, given the relatively small percentage of sales that are likely to result from images
found in any new print catalog, most U.S. agencies are finding that it doesn't make much sense
to pay the cost of mailing catalogs, let alone the costs of printing and purchasing multiple
dupe sets.


We acknowledge that print catalogs are still an important selling tool outside the U.S. But
the market in the U.S is different. Some people point to Getty and Corbis and say print
catalogs must still work in the U.S. because Getty and Corbis are using them. We believe their
catalogs are being used more to draw customers to their web sites than to sell the images in
the books. Getty also benefits from the fact that their photographers pay much of the cost of
production and distribution of their catalogs.


If the primary purpose of a print catalog is to get the brand's name infront of the customer
and promote the web site when the catalog first arrives, it is necessary to ask if this the
most cost effective way to promote?


Results of a recent Corbis Stock Market survey reported to their photographers indicated that
customers prefer frequent, smaller catalogs rather than the larger occasional ones. These
catalogs are considered easier to store, simpler to browse and more user friendly. Stock image
users say they are impressed by catalogs that offer fresh, innovative imagery as well as
inspire them with new layouts and presentations. However, they don't say how often this
inspiration results in actual use of one of the images shown in these books.


Promotion Of Web Sites


If you are using the web to sell images, the number one issue to consider is how the site will
be promoted. What is the marketing strategy that continually reminds potential customers of
the site's existence?


Clearly, it is not enough to just put images on a web site. The site must work efficiently and
be promoted. Among the reasons that Masterfile's site is so successful is that they have
strong brand identity built over more than two decades. Also, their consistent advertising in
major trade magazines and the mailing of two major print catalogs a year helps promote the
site.


If the catalog is not going to be used for long term search, logic would indicate that the
same dollars spent on more frequent direct mail, e-mail promotions and trade magazine
advertising might produce better results.


It appears that many of the print catalogs mailed in the past few years have been dumped
(along with the other junk mail) shortly after they hit the customer's desk, due to lack of
storage space.


Why Portals Instead of Personal or Small Agency Web Sites?


Given that sellers must use the web to market their images, why is it more effective to use
portals rather than personal or small agency web sites?


  • First, portals are structured so participants share promotional costs, effectively
    leveraging their promotional dollar.


  • In addition, buyers seem to like to go to sites where the selection of imagery is large
    enough to give them a good cross section of subject matter in any category they search. They
    also tend to like a site that offers a variety of points of view rather than a very narrow
    editing philosophy.


  • The cost to any individual or company of operating a web site are reduced when using a
    portal because, in effect, these costs are shared on a proportional basis by all the
    participants.

Buyers are sometimes frustrated by too many images on a particular subject, but it seems that
the best solution in these cases is for the agency to offer custom research and custom light
boxes, rather than very tight initial editing. Not all portals agrees with this strategy, but
there is good evidence that it is currently the most successful way to approach the U.S.
buyers.


Portal Models


There are two portals in the U.S. that have some track record and experience. They are
PictureQuest.com and Workbookstock.com. PictureQuest has been operating since the mid-90's,
and has approximately 357,000 images and over 175,000 registered users. They get their images
from approximately 50 agencies and have both Rights Protected and a Royalty Free sections on
their site.


Workbookstock.com has several years experience in operating a portal. They have always focused
entirely on Rights Protected with no Royalty Free. They accept work from individual
photographers as well as stock agencies and have recently revamped their site to focus on very
high end, contemporary imagery. They have about 23,000 images on the site and 46,000
registered users.


Other portals of interest are Alamy.com, Photononstop.com and Stockmedia.net. For more about
Alamy.com see (Story 424 )
and Photononstop.com (Story 435 ).
Stockmedia's technology is currently used by
SolusImages.com ,
Sportschromeonline.com , and
globalphoto.com . Expect to see
additional announcements of other agencies adopting Stockmedia's technology in the near
future.


"5 star restaurant" or a "one-stop hamburger chain"?


One stock agent operating outside the U.S. recently asked, "If you're going to sell online in
the U.S. don't you have to be with either Getty or Corbis?" To illustrate his point he used
the following metaphor, "Isn't a 5 star restaurant better then a one-stop hamburger chain?"


The key to this question is in the use of the word "chain". Owners of McDonald's franchises
earn good revenue even though they are all small restaurants. Among the reasons are shared
advertising and promotion, and brand identity. They also serve their local communities and
understand the needs of their customers.


Stock photo customers don't care if your the biggest, or if you have a reputation for
representing the work of the best photographers. They only care if you have the right image,
at the moment they need it. Getty, in particular, has rejected a lot of images customers want
to use. U.S. customers want alternatives to Getty and Corbis. They will use the small
suppliers as long as they know where to find them.


It is also not necessary to be the biggest to be profitable. (In fact, neither Getty or Corbis
are profitable.) Smaller operators can generate more profits, if they do a few things right.


  • Join together on portal sites so they can share the costs of operation and promotion.


  • Find less expensive ways than traditional print catalogs to promote the existence of
    their portal, and show their images.


  • Maintain reasonable prices through negotiation.


  • Provide a service of researching their online database for their customers. This is
    particularly necessary if the site offers a broad cross section of imagery. (Custom research
    may not be as important when there are only a few images in every category.) It may also be an
    advantage if the seller has an analog file to back up the online offering, and provide more
    depth when needed. Researcher who understand the subjects they are researching are also
    important.


    There are some strong indications that many customers don't have the time to do all of their
    own research. They prefer to call someone (an agent), outline their general needs, and have
    that agent prepare a custom lightbox for their consideration. Part of the success of portals
    will hinge on the quality of this research and how the service is promoted.


  • Get more images online where they can be seen. Masterfile has discovered that when they
    put general file images onto their web site these images began to sell. Many of these images
    were in the files for years and never sold. This would indicate that the normal print catalog
    selection process is too tight for what buyers want and need and that somehow, in the old
    research process, these images never made it to where the buyers could see them. Now when they
    are available to the buyers (on the web) they sell.


  • Get their images into a variety of outlets that promote in different ways and reach
    different segments of the market.


    The marketing strategies of portals vary. Some buyers prefer to use one portal and some
    another. Thus, from a marketing point of view it is often best to have images on several
    portals rather than just one.


    As more and more images become available online customers in the U.S. are rediscovering the
    value of the smaller agency that knows their customers and goes the extra mile to provide
    service. Look for these customers to head back to these smaller agencies as Getty and Corbis
    cut staff in an effort to try to get profitable.


  • Copyright © 2001 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 301-461-7627, 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.  

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