Production Cost vs. Value To The Customer

Posted on 4/9/2012 by Jim Pickerell | Printable Version | Comments (0)

Photographers lament the low prices being paid to use some of their “unique and unusual  images,” particularly when the images are costly to produce and unlikely to be in high demand.

Some photographers, particularly those with unique scientific/nature images, believe that specialist agencies are “shooting themselves in the foot” when they place such images with Getty, Corbis and Alamy. These major distributors dramatically discount the prices they charge for the use of images regardless of how much they cost to produce.

The first thing to recognize is that, in most cases, the cost to produce an image has no relation whatsoever to its value to the customer. The amount a customer is willing to pay for an image is dependent on:

  • How badly the customer needs a specific image rather than just a good image of the general subject.
  • The availability of similar, less expensive images that might fulfill most of the same requirements.
  • The customer’s budget for the project.
Most stock images are not purchased because they are considered “must have art,” or because of the reputation of the creator. Even when an image is costly to produce, if many other photographers have produced good photographs of the same subject matter then the image is a commodity.

Unique isn’t just a different angle, or different lighting of a common subject. So many people are taking and posting online pictures of every conceivable subject matter that, today, it is hard to discover any image that is truly unique. An image may be judged by a large segment of the general public to be more “artistic” than others of its genre, or better illustrating a particular point than all other similar images, but that does not mean that every customer will choose to purchase it regardless of price.

The dilemma for the photographer and the specialist agency is how to let potential customers know that any of their images exist without making them available through one of the major distributors.

Because there are so many choices customers tend to only go to specialist agencies when they know the agency will have something they can use. Since most customers have a variety of needs they tend to forget about niche agencies that can only supply an occasional need. This is particularly true of new, young art directors who don’t have a long history of working with a particular specialist agency.

Thus, to have any hope of success the niche agency must constantly market to a targeted group of customers who regularly need the subject matter the agency offers. But, for a small niche agency it is extremely hard to identify all the potential customers, worldwide, and even if they can  it is easy for such marketing to become an annoyance to the customer and counter productive.

So Is Direct Marketing The Answer?

Would it be better for niche agencies to withhold their truly unique images from the major agencies, or better yet for photographers to withhold their unique images from any agency and market them themselves?

There are three things that need to be considered.
    1 – Is the image truly unique?
    2 – Do you have a way of identifying specific customers that will be interested in your work and are you prepared to market directly to these potential customers?
    3 – Are you prepared to engage in direct negotiations?
1 – Is the image truly unique?

This is actually pretty easy to determine.

First it must be possible to define the uniqueness with keywords. An abstract may be unique – unlike anything anyone else has ever created – but if you can’t define the uniqueness or the abstractness with additional very specific words no one will ever find the image. A picture of a tiger may be unlike (and we’ll concede “better than”) any other tiger picture ever created, but there are plenty of other tiger pictures that are easier to find and cheaper. Any potential customer can probably easily substitute something cheaper for yours.

Assuming you have an image you believe to be unique search several of the most popular databases – Getty, Corbis, Alamy, iStockphoto, Shutterstock, Dreamstime, Fotolia, and Flickr using the keywords that make it unique. This will give you an idea of the competition, both in price and visual characteristics, that is out there. If there are no more than a few hundred of the same general subject on any of these sites, and if your image were placed on one of these sites, it might have a chance of being seen. If your image is not there then it probably doesn’t have a chance of competing against any of these images. Of course, if it is on one of these sites then you must be prepared to accept the site’s pricing structure.

This exercise will help you understand how few truly unique images you really have.
If you’re going to try to market the image somewhere else then you must deal with the second issue.

2 – Do you have a way of identifying specific customers that will be interested in your work? Are you prepared to market directly to these potential customers?

Niche agencies will probably be able to identify some customers who regularly use the type of work they offer. But, most smaller, more specialized agencies are not reaching many customers these days. Most customers tend to go to the major sites to look for images unless they know for sure that a niche collection “generally” has the kind of imagery they usually need. Professional customers don’t have a lot of time to shop around. So they go where they know they can find something that will work.

Hard as marketing is for a small agency, it is even harder for an individual given the time required to reach a significant number of customers. Of course when the individual makes a sale it will often be for a much higher price than the agency might charge and the individual will get to keep 100% of the amount paid rather than having to share the bulk of the fee with middlemen.

If you don’t have the time or the skills to cost effectively seek out new clients you need a niche agency, but you’ve got to hope they can find some customers interested in your particular subject matter.

The big problem with most of the small databases is that they can’t get customers to use them. This is particularly true of professional customers who are willing to pay higher prices for just the right image. Professional customers want to go to sites where they can usually find an image that will work for their project. Given the large number of choices they will quickly forget the URLs of small sites they try once, but fail to find what they need.

3 – You’re going to need to negotiate directly.

Finally, not only will you need some system for pricing various types of use, you’ll also need to be available to negotiate and comfortable negotiating if you how to make many sales.

Is There A Solution?

One solution that has been suggested is a portal where niche photographers can place their images. Each photographer would handle his own negotiations. This could solve the problem of having a broad enough cross section of imagery that potential customers could probably find something usable. But that would require extensive marketing to get image suppliers to participate.

Somehow potential customers would also have to be made aware of the site. It is not a matter of “if you build it they will come.” This will require a costly and continuing marketing campaign as well as effective SEO.

Some of the photographers participating on such a site will not have a good understanding of what they should charge for certain usages. They will undercut the market.

It is worth noting that there are already two sites that have managed to collect imagery from lots of photographers. They are PhotoShelter and Flickr. A few photographers on both sites earn significant money from the collections of images they have put on these sites.

But for the most part this is not because customers have been doing random searchers on the sites. In most cases the photographers are doing their own marketing and the people they bring onto the site are looking specifically for the photographer’s pictures. In addition the successful photographers have a good understanding of how to price usages and negotiation.

Recently, I wrote about one example of using Flickr As A Marketing Tool.

There are no simple answers.

Copyright © 2012 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, 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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