How To

Concept and Perception Vs Reality πŸ™‚

 

Original image source: aphotoeditor.com

Some of you peeps in theΒ interwebs may have seen the post that I scratched together earlier in the year titled “How does a photographer calculate their fees?“.

In there I skimmed through the basics of how a business can create a simple spreadsheet showing how to work out how much they need to earn to keep their company alive, so they can continue to provide a valuableΒ  service to their clients.

Forgetting the required creativity, skill, technique and equipment that is required for any profession that you choose to follow – this is what happens in the background long before (and after) someone picks up the phone with an enquiry. πŸ˜€

Photography is the example here, but the core knowledge transfers to virtually every business.

I know the title of this post is a bit hokey, but I’ve been watching the imaging industry and trends over the last few months and have come to a fairly simple conclusion on the state of play ….

Unless some changes are made soon, the general freedom of photographers and artists to create their work will slip out of the hands of many of those that rely on their art and creativity in order to make a living.


Can you be arrested for killing an industry?

Fairly broad statement, but I feel it reflects the truth of the industry as it stands today.

If we were to split the market into 2 with Social on one side Commercial on the other, I’d say the social photographers are surviving better than the commercial photographers.

Wedding/portrait photographers lament about amateurs undercutting the pro prices so they lose out on weddings or portrait sessions and they blame the influx of consumer digital cameras and the plethora of photographers that do workshops and share their knowledge (sometimes for free).

Really, I don’t think this is that great a problem and sharing information only leads to better results for those willing to learn and apply the information.

There have always been keen amateurs and digital has made it more accessible to them as they no longer have to pay for film and processing, but If an engaged couple don’t recognise the quality and value in hiring a professional service, then they surely know that they risk not having the story of their day delivered well.

There will always be someone else getting married or wanting family portraits tomorrow and as long as that continues then there will always be a need for competent and professional photographers. If you’re worried about amateurs taking more jobs away from you, than I’d say you need to look at the quality of your work (yea I know that sounded a bit harsh)

Commercial photography is another matter – and it is in more dire straits than the social market. Not only are the commercial guys contending against amateurs, but they also have to contend against social photographers widening their scope (tends not to happen the other way) as well as a mass of press photographers being thrown into the already saturated marketplace as printing presses shut down and redundancies are handed out.

Typically a press photographer earns (and subsequently bills) 1/3 of the value of commercial jobs and this undercuts the existing commercial market. Added to this many large corporations now try to get as much content for free as they can (e.g. BBC or Redbull). What would be bread & butter work is fast dissapearing.

Despite all of that ….. I still don’t see it as the #1 cause of the decline in the industry today.

Its Stock Libraries

Getty/iStock, Alamy, ShutterStock, DreamsTime to name just a few – all those heavyweight agencies are efficiently killing this amazing industry in a way that no army of hobby photographers ever could.

Collection of Stock Images

And the sad thing is – photographers are helping them stick the knife in further.
What used to be the photographer’s pension is now being sold to the lowest bidder through these agencies.

I’ve observed news feeds from various sources telling of Stock agency X cutting it’s contributor’s percentage by yet another 10% or some microstock dropping prices and selling work at a penny per picture and so on.
More recently Getty/iStock announcing that it’s changing it’s contracts so that any Rights Managed image that they ‘manage’ that hasn’t sold in 3 years will automatically become Rights Free and open to syndication (I think they’re forgetting who owns the pictures).

I’ve seen many reports from photographers saying their stock sale incomes have halved or quartered in the last year or two, despite the same number of sales being made.

This, I believe, is the core of the problem in the industry.
Value is being eroded by these billion dollar companies undercutting each other in order to try to retain a majority market share. This then bleeds into to public/corporate consciousness. "Why do you cost X amount when we see images in libraries for sale at a fraction of the price?"
As I read in a recent BFP newsletter, it’s become "a race to the bottom".

How can these companies claim to be struggling when their commodity is given to them for free to sell for a 60-90% share of the item’s value?
Instead of dropping their prices, they should be increasing them and improving the quality vetting standards to ensure quality images. This will attract more quality photographers and therefore more clients and help boulster the value of our service.

Perhaps if they had to make their commodity themselves they would be less keen to drop their prices? πŸ˜‰

A traditional Agency will try to sell your value and should(?) work towards improving both you and your subsequent sale value.
If they start asking for better quality and then start underselling you and tell you (not ask) that they’re increasing their percentage, then you’d sack them off in a heartbeat.

That’s exactly what the stock libraries are doing and yet they’re still being blindly fed new images every day.
They cite "If you don’t like how we work then dont use our service"
And I think that’s the solution (and hence my "Jerry McGuire" moment)

I see 2 workable solutions:

1) If one of the big agencies were to increase their picture costs by 33%, then they only need to sell 66% of today’s volume to make the same profit.
Photographers will swarm to it. The clients will get better images as the good photographers will leave lesser paying agencies.

Chances are low that (1) will happen, so here’s a better long term solution:

2) Photographers make 100% of stock sales (at the price they set) by self hosting their stock library.

Simple eh?

We already pay for webhosting, and online diskspace is becoming much more affordable.
e.g. 1,000Gb of space and unlimited bandwidth is not uncommon for around £50/year in the USA, so why not use all that space to host and manage your images.

Get rid of the middle men and sell to clients direct?

Personal/Online Disk Space is Cheap
Personal/Online Disk Space is Cheap

I’ve actually been looking for a simple solution to this for a long time, before caving and purchasing a 30Gb Photoshelter account so I could at least set my own prices with Photoshelter taking 10% of all sales (despite me paying about £250/year for the privilege).

PhotoDeck offer a very similar service (which I found later) that’s cheaper per year, they offer 25% more diskspace and they take 0% commission

However …. I’ve finally found a workable solution for self hosting/management which is a one-off cost of $49 (£35), and if you’re vaguely tech savvy (or have someone that manages your website) then you can easily set this up by yourself.

The website app I found which will run alongside your existing site (if you have one) is called "PicSell"
Website: http://vm.xmlswf.com/picsell
Demo: http://www.xmlswf.com/picsell

People click to add the images to a ‘lightbox’ and then pay at the end to get an instant download of each images at the size purchased …. just like the service stock libraries offer πŸ™‚

It’s still fairly early days, but it will be refined over time and it already seems to do pretty much everything a photographer needs to sell digital images online to clients without having to manage and monitor your library through the process. Go on holiday and it will be quietly and efficiently serving your clients while you’re away.

Best of all, it’s built on an open source website content management system called Joomla.

So the only real cost is for a one-off PicSell license and the time it takes to set up a folder or subdomain (e.g. http://stock.mysite.com) to manage your images. A good webdesigner should have it running in well under a day with the majority of time coming from customising the look of the site/library.

I build my own websites and I’ve yet to look further into this, but I know for a fact that when my PhotoShelter account expires, I’ll have everything in place ready to switch to my own hosted library – for the same cost as a meal out.

So all you pro image makers out there – let’s leave the stock agencies to the holiday point ‘n shoot brigade and retake our industry’s future back into our own hands πŸ˜€

Providing (or hiring) Photography as a service requires a minimum fee which is calculated the same way as any other business.

Business Costs + Expenses + taxes = minimum turnover required.

Divide that by 230 and you have your average daily minimum requirement.
Why 230?  …   5 days x 52 weeks, minus 20 days vacation and 10 bank holidays = 230 πŸ™‚

This is also assuming you have daily paid work, print sales or licensed image income πŸ˜‰

Social photographers often work for 2 days in order to generate 1 complete day’s portrait work and Wedding photographers will work for 1-2 weeks on each wedding, but spread over a 6 month period.

We also have to take into account that photography is often seasonal. Busy summers and quiet winter months. Plus there are many days when business owners have to work on accounts, marketing, meetings, networking, testing, blogging πŸ˜‰ and so on …

None of which is time generating a direct income.

So….. below you’ll see I made a simple table showing estimated costs from a hobby photographer up to a studio +1 assistant where the photographer wants to earn the UK National Average salary of £24,000.

The numbers look a bit whacky, but thanks to the lovely tax man they do add up.
I even kept it conservative by choosing the lowest marketing budget where it should really be the biggest spend (existing business owners will know of the many tax benefits, but I’ve kept it simple)

So there you have it.
Try it with your own expenses and numbers and you’ll find your own minimum day rate πŸ™‚

I should point out that I’m not taking anything away from highly skilled hobby photographers, but if someone is hiring you for work then you should at least get insurance to protect yourself, your equipment and also your client … and also put a proper value on your skill.
… and pay tax πŸ˜‰

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