I found this Fast Company article titled, Mayhem on Madison Avenue, to be a fascinating read. As a former ad industry creative, this really came as no surprise to me as I had realized that most of the creatives at the ad agency I worked several years ago had no idea about digital much less had experience with blogging, SEO, social media, etc… Such was the case at the other places I worked at following that agency. The sad part was that no one figured their career path might be going extinct. Well that day is has already arrived according to this article.
The article cites agencies struggling to price work in the digital era because clients want more work but are willing to pay less for the work. Various business models have popped up in the meantime including crowd-sourcing ad creative. The “race to the bottom” if you will. Ten years ago when all media spend was limited to print, broadcast and radio it was easy to work in the industry because reaching people was rather formulaic and several large holding companies owned all the advertising spend. No longer. There are a million different ways to reach the consumer now and for the consumer to receive content. “Competition” is popping up in all sorts of places that never existed previously.
Sound familiar? Yes. The photography industry has already been heading down this path for ten years now as you already know. You can literally swap out the words ad agency for Getty / Corbis and photographers and write the same story.
Having only been a photographer during the internet-era, however, I feel there has never been a more exciting time to be a creative person because of all these reasons. My photography website for example reaches tens of thousands of visitors per month and I have about 1,000 more people that I reach on a daily basis via the social media sites I’m on. Had the internet not been around when I started photography, I probably never would have even bothered to try sharing my work much less talk about it because what audience would I have – family, local camera club, a stock photo agent, and a few clients? There’s not a lot of people where I live that are into outdoors and the type of photography I do.
Had this been 15 years ago, I’d probably have a few photos hanging on display in the local library, setting up a booth at weekend farmer’s markets and art fairs, be on the phone all day cold-calling and maybe consider running some print ads in advertising award annuals with no guarantee of success but a lot of money out of my pocket. But this is 2010 and here are two sites I have had an opportunity to be featured on in the past week:
Pro Nature Photographer – a website about the business of nature photography written by long-time industry vet, Charlie Borland.
The Rogue’s Gallery – an art website for current and former ad industry professionals curated by Steffan Postaer (ad god and creator of the Altoids ad campaign).
Who knows if I’ll get any direct benefit from getting my work on these sites but I know who reads these sites and those are the types of people I’m looking to reach. When you simplify the new technology down to that level, basic marketing principles have not changed at all. It is actually easier than ever to reach people and obtain any sort of metric you could imagine that was never available previously. You can cut it up so many different ways from checking referrer sites in your web analytics and tying that to geographic data, to seeing who comments on the sites, to which organic search terms people found your site via the search engines, to seeing Quantcast demographic info about any site out there. Any webmaster in the world can create a media kit and sell to advertisers now. You could create a media kit so detailed that it would bore even the most anal media buyer. This is powerful stuff at our disposal.
Occasionally there are photo forum threads that ask for photography business book recommendations but one particular person’s question stood out to me. This photographer was interested in learning more about the business of nature photography and was complaining that all of the business books they had seen were about commercial or studio photography and thus did not apply to them. In my opinion, this is completely wrong.
The best book out there on how to run a successful photography business is John Harrington’s Best Business Practices for Photographers. It is a generalist commercial photography book yet I got a lot of useful info out of it and so have a lot of others judging from the reviews. It doesn’t matter what genre of photography you are involved with, the business principles are all the same. You have assignments, you license images, you have contracts, you deal with clients, legal issues, accounting, marketing, etc… All photo businesses have all or some of these elements.
This photographer probably drew a distinction between nature photography and everything else because of a romanticized idea of what it’s like to earn money as a nature photographer. The reality is that everyone from Art Wolfe down to the part-time wedding photographer has to treat what they do as they would any other business if they expect to stay in business. Without a solid grasp of business fundamentals then it is nearly impossible to make any sort of consistent progress.
With that said, here are some great photography business books that I would recommend in addition to John Harrington’s book:
I was looking through some professional photography industry websites and came across this white paper that ASMP made available for syndication. I don’t know when it was written but here it is:
An ASMP white paper by Richard Weisgrau
Publishers control the day rate that they pay to photographers. In 25 years they have failed to increase the day rate to a level that would allow photographers to maintain the standard of living of 1973. In spite of this failure, many publishers seek more and more rights from photographers for the same low and continuously eroding fees. The situation is out of control. Photographers feel that they cannot control the day rate. They perceive that they have little individual clout in a negotiation with a major magazine. They cannot collectively bargain, since they are independent contractors and not entitled to the collective bargaining power of a union. The simple fact is that the publisher has all the advantages, EXCEPT FOR ONE. If the situation does not improve, good and reliable photographers will eventually be forced to refuse editorial assignments, since these will not support the photographers’ costs and commitments to their businesses.
While the picture may appear bleak, there is one advantage that the photographer has over the publisher. Photographers provide the content that the publishers need. Although individual photographers cannot bargain collectively, if enough individual photographers refuse to work for inadequate pay, publishers will have no choice but to react to the forces of the free market system and increase their payments for photography. ASMP cannot force a photographer or a publisher to do anything. It cannot organize a boycott or a strike. It cannot set a wage, fee, term or condition for photographers. But, ASMP can express its opinion and give its advice. This paper provides that opinion and advice.
In 1973, the per capita income in New York State, where many photographers reside and work, was $5,969. In 1997, the per capita income in New York was $30,299 or five times greater than that of 1973.
In 1973, the minimum wage was $1.60 per hour. In 1998, the minimum wage was $5.15 per hour or 3.2 times higher than the rate of 1973.
In 1973, the average day rate for editorial photography assignments with one-time rights was $200. In 1998, the average day rate for the same editorial assignment is $450 or 2.2 times higher than the rate for 1973. The editorial day rate has fallen behind even the rate of increase in the minimum wage.
These statistics show that the compensation paid to editorial photographers is forcing their living standard down faster than that of the general population. They also show that untrained workers have experienced a greater rate of wage increase than highly trained and skilled photographers. How can publishers get away with this? The answer is simple. Publishers use their economic clout to dictate fees to photographers who, like most of us, need to work. The “take it or leave it” position of most publishers leaves most photographers in a position where they have to choose between inadequate compensation and none at all. Necessity dictates the choice.
The table below shows that editorial fees have simply deteriorated over the years to the point where the very existence of editorial photography on a professional level is now threatened. The day is quickly approaching when competent and properly equipped photographers will not be able to provide publishers with those images which inform readers, bring events into their consciousness and help them get a better picture of our world. The chart applies changes in the consumer price index to the 1973 day rate. The adjusted day rate shows what the day rate should have been in 1998, if it had been adjusted for inflation.
Editorial Day Rate Analysis
Base year: 1973, 1986, 1990
Average day rate: $200 $350 $400
C.P.I. factor (to 1998) 3.671.521.25
The above chart clearly demonstrates that, not only is the day rate woefully behind its 1973 base, it even has failed to keep pace with the inflation of just the last ten years, when they are taken as a base rate. A recent survey of ASMP members shows that the current average day rate for one-time editorial rights (print media only) is $450. Interestingly, this average is higher than the rates paid by many major magazines, like Time and Business Week, which pay base day rates of only $400. The average is pulled up because some specialty magazines pay higher rates to the best photographers, and ASMP members are more often in this group.
ASMP anticipates and acknowledges the argument that many publications went through very traumatic times in the early to mid-seventies. Television took its toll on advertising revenues and readership. Famous magazines closed their doors forever. A few were later resurrected with a new look and approach. In spite of this decline, however, the fact is that there are more magazines and print publications than ever before. Certainly, the economics of magazines have changed, so ASMP will concede that it might (but only might) be unrealistic to conclude that magazines can afford to pay at least the same level of fees that they paid in the early 1970s. However, it is also not unreasonable to point out that the publishers’ and editors’ and other staff salaries have been more than adequately adjusted to meet the economic realities of today. This is not true in the case of photographers.
Certainly, by 1986 magazines had economically reestablished themselves and found their way to profitability. But, even if we concede that the day rate of 1986 ($350) was fair compensation in light of economic conditions, we see that publishers have not seen fit to raise the day rate to a level that paces it with inflation. Indeed, the past seven years have seen the economy grow to record levels, and magazines profits have grown with it, but the day rate paid to photographers has once again fallen behind the decade’s rate of inflation. It does not take an economist to see the trend. While photography is every bit as important to publications as it ever was, the reward for it continues to decrease.
There is another factor that is easy to lose sight of when considering the unfairness of the rate of compensation paid to photographers. For each day that a photographer is paid for, he or she spends additional time performing tasks related to the work done on the paid day. ASMP’s survey shows that, for every day of photography, the average editorial photographer spends a total of 10.2 additional hours on assignment preparation, post production work, administrative duties and travel time. The result is that it takes 18.2 hours to earn a single day’s rate. At $450 per day, the photographer is actually earning $24.72 per hour. Keep in mind that most photographers must maintain in excess of $50,000 in equipment in order to do their work, have to have business insurance, must pay their own medical insurance premiums, etc. Photographers have the same costs of doing business that any small service business has. Many of them are also paying off college loans for the education that is a necessary prerequisite to be a successful photographer today. There are few businesses in the USA that can support their owners and meet their overhead on $25 per hour in revenues.
Considering the above facts and recognizing that this situation is unlikely to change without some dynamic force being applied, ASMP offers its opinion that publishers should raise their editorial day rate to a MINIMUM of $550 in 1999, with subsequent raises to $600 in 2000 and $650 in 2001. These rates would include one time use in print media and would not include electronic rights, foreign language rights, or English language rights outside of North America, or any reprint rights. ASMP also believes that photographers have good reason to adopt these recommendations of ASMP in their individual negotiations with publishers, and that, while free to ignore ASMP’s opinion and recommendation, doing so would only further threaten their economic futures.
The eroding economic position of editorial photographers must be stopped and reversed. It seems clear that publishers have no intention of changing it as of this writing. So photographers must either change it or face further degradation of their earning power ever year. How can you, as an editorial photographer, motivate this change? ASMP suggests the following. Copy this paper as many times as you wish. Give copies of it to every editor you work with, every time you work with them. Send ASMP the names and addresses of every publisher, managing editor, photography editor, etc. in the magazines you work for, and we will send them this paper for you. Tell the publishers that you agree with ASMP’s opinion and recommendations. Be conscious of what is happening to you and how poorly the trend bodes for you. Change your fate by insisting on fair compensation. Do not give away your future.
Note: Permission to copy and distribute this white paper was granted by the author and ASMP.
When thinking in terms of your own photography business, it would be wise to observe what other types of businesses are doing like retail stores, restaurants, business-to-business service industry, etc… There is a lot that can be learned from evaluating the good and bad decisions that these other businesses are doing. I’ll use this local Japanese restaurant as an example:
I got this menu in the mail a while back. It was fully illustrated with nice pictures of sushi and other dishes. It probably cost them a lot of money to produce so I decided to order take-out from that restaurant one night. I knew where the place was located on the map right on Route 66 but while driving into the strip mall parking lot, I started to question whether or not I was in the right place. The reason why is because from the traffic flow directions, there is no line of sight to the restaurant. The view is completely blocked by a Merrill Lynch office from every angle. To complicate matters, on the strip mall marquee, the restaurant wasn’t listed.
Now I can understand that if the restaurant does okay business-wise during lunch when there is foot traffic from Merrill Lynch, but when I went for dinner there was no one in the restaurant except for the owner’s family and another fellow take-out patron. I wasn’t surprised because due to the location of their restaurant, it is impossible to get unsolicited walk-in diners after the work day ends. Heck, I knew where the place was and still was unsure of where it was.
All of the restarant’s dinner customers are being driven there purely by their direct mail efforts. Well that costs a lot of money per customer so as a result, they are probably not as profitable as they would be located in a more strategic location. This strip mall doesn’t have the type of businesses to bring people in during the dinner hours either so really at this rate, they should either consider relocating their business or just shutting down for dinner IMO.
My point is that if there are opportunities to get customers for your business that do not require your direct involvement then that is the most efficient type of sale you can ever get. It is about getting visibility as efficiently as possible. Whether those customers are parents driving by on the highway looking for dinner one night after work or a local hospital looking on the internet for prints to decorate their hallways, a smart business owner considers these factors in their business marketing plan before setting up shop.
When you freelance to pay the bills, (unless you’re already loaded), it’s not about how much gross income you make, it is how much net income you come away with. When you have a full-time job, it’s nice to get health insurance benefits (hopefully), have taxes taken out with every check and money put into retirement. When you don’t have one, then it is up to you to manage all of those things. So the freelancer really has to think of their income as business income, not salary. The IRS says so as well. Regular jobs don’t come with an overhead cost usually, but freelance jobs usually do, particularly photography. If you’ve ever had to do temp work or in an industry with no job security, then you can probably relate also.
I’ve heard a joke from some professional photographers that you can tell the difference between the full-time freelancer and a serious hobbyist just by looking at them. The F/T freelancer has a beat-up camera & lens and drives a 20 year old car. The other photographer has the latest equipment and makes sure everyone knows it. For the freelancer it’s as much about minimizing your expenses as much as it is generating income. So what types of costs are there to consider?
Camera: Do you need the latest and greatest body? It depends. Can you get the job done effectively with your current gear?
Lenses: Can the images I can only make with the image stabilizer lens sell for enough money to justify the extra cost? Can I get similar image quality with a non-Canon L lens? Would it be smarter in the long-run to put this money into a mutual fund or property investment so I can upgrade later?
Car: Does your 15-year old car still work? What is the gas efficiency? How much does it cost to maintain?
Travel: Hotels or camping? Can you get an inexpensive room in the city without fearing for your life? Does camping still save you money once you factor in the driving distance? Can you find someone to split the travel costs with? Haven’t I photographed alpenglow on Half Dome ten times already? Would I ever sell an image from this place if I go there?
Office: Where you handle your daily business – can you get the same amount of work done conveniently in your own home rather than renting studio space? I’ve read and heard all sorts of things from wedding photographers believe that meeting in the photographers home helps to seal the deal, to having a downtown studio sounds more impressive to photo editors.
Other Stuff: Everything else that normal people have.
The moral of the story: It’s hard to earn a living doing what you enjoy but many are doing it. It can be an incredibly rewarding occupation or part-time business. It requires a lot of personal sacrifice however. There are some people making a mockery of photography by giving work away for free or selling royalty-free for pennies. If you are going to shoot serious pictures, then charge appropriately for your pictures. If they are good enough to be published then they will sell for market value. With the general public suspecting each photographer of being a paparazzi member, terrorist or a source for free photos these days, really all photographers are being affected by the actions of a few. This is not simply a matter of economic philosophy. What it comes down to is that photography needs an image rehabilitation and that should start today with you and I. It’s about educating those in need of one.
To start this blog off the right way, let’s take on one of the most popular photo business topics of them all – stock photo agencies.
Quick background info: Stock photo agencies are a source where art buyers (advertising agencies, publishers, corporations, small businesses, etc…) can license pictures for publication. A stock photo agency can range in size from large corporations like Getty Images to a family-owned business such as Galen Rowell’s Mountain Light Photography. Getty is considered to be a general photo agency that has every type of photo imagineable while Rowell’s is a niche agency consisting of his own outdoor adventure and landscape photos primarily.
Getty is the industry leader by far, but not too popular with many professional photographers at the moment due to questionable business decisions and unfavorable contract terms for their contributors. In recent years, photographers have flocked to competitors like Alamy Images and start-ups such as Digital Railroad Marketplace and the Photoshelter Collection.
– Reach markets that you currently aren’t
– Let someone else handle the day-to-day licensing of your images
– Earn $$$ for your photos
– Some agency contracts take more than 50% commission ie. Getty.
– Some agencies require image exclusivity, meaning that you can’t license those images anywhere else for the duration of your contract. ie. Getty, Corbis, Age Fotostock, Lonely Planet Images
– Time consuming to produce and supply a large quantity of digital files on a regular basis
– The market is over-saturated with images
– The need to keyword and caption your images
– Most do not tell you the exact source of your photo credits, some will give you basic info about the type of publication
– Competition with other agency photographers for a share of the pie
Legit stock photo agencies:
The Big Ones- Getty, Corbis, Alamy, Jupiter, Age Fotostock
For a more comprehensive list of agencies check out A Photo Editor’s Stock Photo Agencies list. Be sure to avoid the agencies under the “Crap” category…
(I have images with Alamy, PSC and DRR (distributed via a niche photo agency) and will discuss my own experiences with them in a future blog post.)
Exclusive or non-exclusive?: The idea behind signing an exclusive contract is a matter of maintaining higher prices by limiting the amount of photos available in the market. Getty Images for example makes contributors agree to not market their images elsewhere during the duration of the contract. The goal is to maintain a higher licensing fee because those same images cannot be licensed anywhere else but through Getty. Before the onslaught of high-resolution digital cameras the past few years, Getty routinely licensed images for $500+ so this made sense. Those rates are a thing of the past now partially due to an over-supply of images in the market and some naive photographers giving away rights to their images for pennies. I have read that Getty’s average licensing fee is around $250 now.
So if non-exclusive agencies tend to go for a slightly lower rate, why would the photographer choose to do so? Because you can submit the same images to multiple agencies in addition to marketing them yourself.
Photo agencies that ask for exclusive terms are usually established enough so that can back it up with numerous sales of your images. So the question is can you make an equal amount of sales if not more through your four non-exclusive agencies? Either way, it is pretty hard to get by with only licensing images through stock photo agencies these days whether or not you decide to go with Getty’s 30 / 70% commission split or Alamy’s 65/35% commission. There are a number of photographers out there that have had a fair amount of success using a combination of non-exclusive photo agents as well as running their own licensing business. Much like investing in the stock market, diversification is a smart strategy.