Negotiating Stock Photography Fees
There is only one thing to negotiate when you are licensing stock
photographs—that is, the price of the license. There are no expenses or
possibilities of a time shift. There is no risk about what the
photographs will look like. There are no expenses to negotiate an
advance for. Transfers of copyright ownership are not an issue. There
is a pricing system in place for various types of uses. You don’t have
to do much homework or preparation. Sounds like a dream world, doesn’t
it? But in fact, it can be more of a nightmare than a dream. Since the
only major factor is price, the competition over sales can be ruthless.
As competition holds prices down, many stock photography sellers
frequently accept low prices, because the cost in time to them for
negotiating a few dollars more in revenues is not worth it. In spite of
the intense competition, there is still an opportunity to negotiate,
especially when licensing rights for high-priced uses such as
advertising.
Abstract Factors
When you are negotiating a stock sale, you should try to acquire and
consider certain pertinent information at the beginning of the
conversation. This information is used to help you sell the client on
your image and price. Let’s look at each one of the items.
Type of Client
Who is the buyer? Does the name give you any indication of how deep the
buyer’s pockets might be or how reliable they might be for payment? You
might recognize the name as an upscale agency that works with prestige
accounts, or as a local business with a bad credit reputation. If the
buyer is an ad agency or design firm, try to find out who the end user
is. If you recognize it as a company that goes first class in the
quality of its advertising and promotion and you know that your image
stands out, you can probably get a good price for whatever rights they
want.
Competitive Images
You must evaluate the extent of the possible competition you will face
in making the sale. The level of originality in a stock photograph is
directly related to the level of competition it faces and its value in
the marketplace. What is the nature of the specific image the buyer
wants to license? Is it a unique photograph, meaning that there is
little chance the buyer is unlikely to find a similar image among your
competitors? Can dozens, hundreds, or even thousands of similar images
be found in stock agencies around the world? Can similar images be
found in royalty-free collections? If so, you know that you are trading
at the lowest end of the price scale. If you are familiar with stock
catalogs in print or online, you will have a good idea how your
specific image stacks up in the world of stock photographs. If there
are no, or only a few, similar images in catalogs, you are in a great
position.
Timing
When is the client’s deadline? Just as in assignment work, a tight
deadline is to your advantage. The buyer called you because you have an
image that meets a need, but it also must be wanted right now.
Remember, the buyer knows exactly what the image looks like. Coupled
with a tight deadline, you can use those temporary assets as an
insurance policy. The message to the buyer is: Buy now at the offered
price and eliminate the risk of not getting the image in time.
Motivation
Why does the buyer want this specific image? This is not about the
buyer’s need to use it. This is about the image’s properties that make
the buyer want it. He must like it or he wouldn’t price it. Why does he
like it? The answer to the question tells you what features to recall
when selling your deal to the buyer. In the sales world there is an old
adage: “Sell the sizzle, not the steak.” You know why chain restaurants
put photographs of their dishes in the menu? They do it for sensory
appeal. Once you know what excited the buyer about the specific image,
you can casually mention it as your discussion progresses. If you
cannot find out why he likes it, then look at it to see what
distinguishes it for the type of use the buyer wants to make of it.
Then sell that feature.
Concrete Factors
The next information that you will seek relates to the concrete factors
that affect the price of a stock photography license. These five
factors help you determine the potential value of a license, based upon
the traditional rules that govern the pricing of stock. That rule is:
The more visible the image will be in use, the more it should cost to
license it. Let’s look at each of these factors.
- The size of the reproduced image, such as
full, half, or quarter page or screen, indicates the relative
importance of the image to the project. Bigger means it is more
important. Consequently, it should cost more.
- The
placement of the image is an important factor. A cover photograph costs
more than one used for inside use. A home page on a Web site costs more
than a secondary page.
- The geographic and language
distribution of the intended use also has a bearing on the price.
Worldwide rights cost more than North American rights. Right to publish
in four languages is more expensive than the right to publish in
English only. Language is related to audience, and more languages means
bigger audiences. This means a higher price. Don’t forget that any use
on the World Wide Web is a worldwide use. Even if it just for a Web
site in one country and published in one language, it is automatically
a worldwide use.
- The type of media is also important.
Print-media prices are usually based upon circulation or press run.
Electronic uses are usually based on either quantity or duration of
use, but sometimes on both.
- The market segment served is
also important. Advertising applications command higher fees than
corporate, which command higher prices than editorial uses.
- Circulation
and press run in (number of copies printed) are ways to gauge
visibility: The greater the numbers, the greater the price.
Buyers are used to being asked for this kind of information, because
they experience it every time they try to license stock photography. It
is the standard way prices are set. If you access an online stock
agency and look at pricing, you will find that the above factors are
used to automatically calculate prices. Photographers have several
options if they want to purchase stock-photography pricing software.
Each available software product builds prices on the above factors.
Unlike assignment photography, the pricing of stock photography is very
systematized. However, systems do not always assure that you will get
the best value for your image. Systems operate on rules and rules can
limit some opportunities.
(c) 2005 Richard Weisgrau [contact] [bio]
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All About Business 
Originally published as Chapter 7, Negotiating Stock Photography Fees in the book titled