Low Slow Sales Growth For Shutterstock

Posted on 2/15/2019 by Jim Pickerell | Printable Version | Comments (0)

Shutterstock will report its fourth quarter 2018 numbers on February 26, 2019. If the last three years are any indication, it is unlikely that there will be much evidence of additional sales growth.

I’ve put together a chart of quarter-by-quarter sales since the beginning of 2014. The chart offers some interesting insights, particularly in regard to what has been happening in the last three years since the beginning of 2016.

Quarter Downloads Images in   Total Rev Avg Rev Total Rev Per Difference
    Collection   (millions) Per DL Download (millions)
  (in millions) (in millions)     (dollars) (millions)  
Q4 2013 28 32.2   68 2.43 68.04 -0.04
Q1 2014 29.7 35.4   72.8 2.45 72.765 0.03
Q2 2014 31.5 38.8   80.2 2.52 79.38 0.82
Q3 2014 31.2 42.7   83.7 2.65 82.68 1.02
Q4 2014 33.5 46.8   91.2 2.68 89.78 1.42
Q1 2015 33.4 51.6   97.5 2.87 95.85 1.64
Q2 2015 35.9 57.2   104.4 2.85 102.31 2.08
Q3 2015 38.1 63.7   107.3 2.76 105.15 2.14
Q4 2015 39.8 71.4   115.9 2.86 113.82 2.07
Q1 2016 41.2 81   116.7 2.77 114.12 2.57
Q2 2016 43.4 92.1   124.3 2.81 121.95 2.34
Q3 2016 41.2 102.7   123.1 2.91 119.89 3.20
Q4 2016 41.1 116.2   130.2 3.02 124.12 6.07
Q1 2017 43.5 132   130.2 2.96 128.76 1.44
Q2 2017 42.7 144.7   134 3.05 130.23 3.76
Q3 2017 41.9 155.8   141.1 3.23 135.33 5.76
Q4 2017 43.9 170.1   151.8 3.33 146.18 5.61
Q1 2018 43.7 196.8   153 3.40 148.58 4.41
Q2 2018 45.2 215.1   156.6 3.41 154.13 2.46
Q3 2018 43.9 233   151.6 3.40 149.26 2.34
Q4 2018 46.8 254.8   162.1 3.40 159.1 3.00

Note that from Q1 of 2016 through Q3 2018 there has only been a 6% increase in the total number of downloads per quarter. But, during the same period there has been an 187% increase in the total images in the collection. Adding images isn’t generating more sales. Customers may have more to choose from, but they aren’t buying more.

This is certainly an indication that Shutterstock is already, and has been for a long time, reaching all the potential customers in the world willing to pay money for the images they use. There may be more images being used online, but if so, this growth is in free images, or in images users created themselves, not ones customers are paying to use.

Existing paying customers use about the same number of images each year. Just because they are offered more choice, doesn’t mean they will use more images.

Revenue growth has certainly declined. Between Q4 2013 and Q4 2015 per quarter revenue increased 70%. In the three years between Q3 1015 and Q3 2018 the total increase had dropped to at 41% increase between the 2 quarters. In the 2 ½ years between Q1 2015 and Q3 2018 the revenue increase was down to a 29% for that period.

Revenue Per Download

While the average revenue per download has been climbing steadily except for the last three quarters this number is deceptive. It includes low priced still images which make up the vast majority of downloads and the much higher priced video downloads.

We believe that video downloads are actually growing, but we have no real idea how fast. We also have no idea of the percent of downloads that are video, but we suspect it is significantly less than 10% of total downloads.

Nevertheless, the higher prices for video, and the increasing number of such sales, could entirely explain the overall increase in the Average Revenue per DL.

With the smaller subscription and packs that Shutterstock has introduced in the last year or so, customers may now be able to better tailor what they pay to actual usage needs. This could mean that the average price for still images licensed may actually be declining.

As the reader can see when we multiply the Revenue per DL (column 5) by Total DL’s (Column 2) the result accounts for virtually all the total revenue for generated in each quarter. The figure in the last column indicates a small amount of revenue that comes from lines of business other than image and video downloads. Shutterstock divested itself from some of these other businesses in 2018.

Copyright © 2019 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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