So far my posts in this forum have not yielded much in the way of discussion so I thought I might try to stimulate some by getting into an area that is maybe a bit more controversial and is sure to spark some opinions both ways.

As I glance at the various stock photo related discussion boards every few days, and occasionally dare to jump into a discussion here and there, one thing is quite clear to me - the industry seems to be in a bit of a state right now. At one end you've got the major distributors (I won't call them agencies, cause they haven't been agencies in the true sense of the word for some time now), such as Getty, Corbis and Jupiter, who are looking to place a stranglehold on market share by buying up and producing exclusive content like there's no tomorrow. From what I can tell, this is done through a combination of "insourcing" the most talented producers, cherry picking portfolios and buying out what they deem to be the most marketable images or by simply buying out smaller competitive producers and agencies. The mega players typically fetch the best price per image sold because of their reputation in the market place and their perceived lock on the highest quality content.

At the other end of the pricing spectrum, we see the continued onslaught of the so-called "Micro-Payment" sites. This fairly new, aggressive model operates by selling tons of photos for a very low price and paying the photographer a low percentage of all sales, usually resulting in the image owner receiving anywhere from a few cents to a dollar or so per image sold. I include low cost subscription sites in this field as well as the typical price per image sold is usually a few dollars or less. The premise here of course is that if you sell the same image enough times you may actually make a decent return on it, and some photographers do. While there are some professional photographers who dabble in this market, I'd venture to say the vast majority of those who submit images to the micro's are "weekend warriors" with half decent digital camera's who just like the exposure they get by selling some of their images. I've heard through the grapevine there's even a user forum where contributors brag about all the high profile places they've seen their images, as if they are proud that a Fortune 500 company just bought the rights to use their image for a few bucks. Scary thought.

All of this makes things very confusing for the supplier of all these images who is trying to figure out where they belong in this (mine)field.

So, is there a middle ground? Yes there is, but, like a size 28 belt on a size 42 waist, things are getting squeezed from all sides. The middle ground is comprised of small to medium sized players who may work with various licensing schemes and use a wide variety of marketing techniques. Some are fairly successful at it, others tend to fizzle and die after the first year or two, when the buyers don't come to play in their "field of dreams". I'm starting to know this middle ground well. I've been playing in it for about 3 years now and even in that short time I've seen a lot of changes. So far my tiny (relatively speaking of course) online stock library has survived, in fact we are growing quite nicely at present thanks very much. How have we survived? Well, partly luck I suppose but also there are three things I have always insisted on that I think to date have served us well. Maybe in a future article I'll talk about those three things a little more. Speaking very honestly though, this has proven to be far tougher than I ever imagined it would be.

While I am an agency owner, I'm also a photographer, although at present I only market my work through my own site. This gives me a good awareness of the dilemmas today's stock photographers must face. As a photographer, do you work on high end, exclusive content, market your work through multiple non-exclusive agencies or play the micros and see how that goes? While I obviously have my own opinions in this matter, I'm not going to tell you what to do because its different based on your circumstance. I would say however think hard about the value of your photos to you and then contrast that to their potential marketability.

Now here's the trick, how does one determine the value of ones photos and their marketability? The first thing we have to realize is that this all comes down to pure economics - supply and demand. The second thing to realize is that savvy customers know this very well and won't pay more than they have to for an image. The third thing to realize, and many of you will disagree with this statement, is that the licensing model (RM, L, RP, RF etc) doesn't matter. What matters is the value of each sale relative to the perceived value of that image, and whether that sale adversely affects future sales of same. Based on those three assumptions, here one way to figure out where you fit.

Create a square and divide that square into four equal sized quadrants, then further divide each of those quadrants into 4, resulting in 16 equal sized squares. The X (horizontal) axis measures relative image quality, while the Y (vertical) axis measures relative market potential. Image quality (and be honest with yourself here) should include things such as overall appeal, clarity, size (at reasonable resolution), lighting, naturalness of the subject, whether you have necessary releases, etc. I would also argue that image quality includes the way you caption and keyword the image, which should be accurate and comprehensive but not overstated.

Market potential is based on how likely a buyer is to find a very similar image elsewhere, as well as an assessment as to how much overall demand there would be for that particular type of image. Breaking it down to economic terms again, a high amount of market potential requires a high demand combined with a low supply.

Lets try to figure out where the various market players will exist within the grid. First off, black out the two squares in the bottom left corner (see diagram), there's really not much hope for low quality, unmarketable images anywhere. Next bisect the upper right quadrant with a diagonal line. This is where the top-tier distributors play. You might also think of this line like a security gate at a private club. If you are not already a member it will be difficult to get through, but maybe not impossible. In this triangle lives the temptation of the extraordinarily high prices we often hear about but most of us seldom see. So what does that leave? Remembering that market potential is driven by supply as well as demand, the micro-payment players tend to play in the low market potential half of the grid whereas the higher priced middle players tend to gravitate more towards images which are a bit more unique and hence have more market potential. They have to, in order to compete with the micros. Of course, one also has to realize, as shown in the diagram, there's a fair amount of overlap between the various segments as well.

Now, try to plot a random sampling of 100 or so of your images into this grid. This should give you some idea as to where your images may do well. Most likely, you will have dots in several different areas, and that's good. That means that you may want to consider segmenting your portfolio into several different areas and marketing it accordingly.

So where does this leave the industry as a whole? Despite my distaste for the micro's and the potential long term damage they may cause I do believe that there is room for all three types of players in this continually growing market. A lot of it depends on you, the photographer taking some control and putting some careful planning into how you distribute your images. Don't place your best images with the highest potential in the micro-payment sites. If you do, I'm sorry but you deserve what you get. Conversely, don't submit those old standby, dime a dozen, stock photos to the higher tier distributors and expect success there either. Customers just won't pay premium dollar for stuff they can buy on the cheap.

Rather than fret about the current challenges, take control of them. Remember, at the end of the day, distributors can only sell the images they have access to. Start to think more like a distributor, remember the economic realities and I predict things will start to become more clear in the months ahead. Best of luck to you.

(c) 2006 Steve Smith, World of Stock [Contact] [Bio]