Category "Pricing & Negotiating"

Real World Estimates – Pricing Photography for Image Libraries

By Jess Dudley, Wonderful Machine Producer

Lately, I’ve noticed more and more corporations and ad agencies are requesting that photographers quote on producing “image libraries”. An image library is a pool of pictures that a client will commission, where they’ll license rights to use the photographs from a shoot in a variety of different ways, and they’ll often make them available over an intranet to different departments across their organization. The productions tend to be broad in their approach, loosely covering a variety of situations, sometimes in generic ways, rather than having a single specific objective. On rare occasion, library images will be used for ads, but most tend to be used for internal and external communications, and for publicity.

In the past, it was mostly institutional clients like schools, hospitals and other non-profits that liked to work this way. Those types of organizations tend to have a variety of different (often low-budget) publication and advertising needs that require a lot of pictures on a regular basis. But increasingly, where big companies once had photographers on staff to cover these types of projects, corporate downsizing has them now turning to freelancers.

One reason clients are willing to pay for broad (or unrestricted) licensing is because it’s often very difficult to maintain control over the use of the pictures when they’re available for use by so many people within their organization. So rather than risk a licensing infringement, they’ll negotiate unlimited use. Other times, clients expect to use such a high volume of photographs that they feel they can get a better deal by effectively negotiating a “bulk rate”. Still other times, a client will be willing to pay for the additional usage simply for the convenience of never having any limitations on their use of the pictures. In all of these cases, unlimited “library” use is worth significantly more than limited use.

But in a world where photographers traditionally price their product based on usage, what is “unlimited” use worth? There have always been photographers who intentionally or unknowingly ignore the subject of licensing, or otherwise simply give away unlimited use of their pictures without charging a premium for it. Those tend to be young photographers who don’t know any better, or established photographers who have found that it’s the only way they can compete, or they couldn’t be bothered with the extra work involved in understanding how image licensing works and explaining it to their clients.

However, in most of these cases, pricing photography “by the day” is a dysfunctional system, and not in the interests of the photographer or the client. There’s an inherent conflict when a photographer is compensated in inverse proportion to her productivity. The more photographs she produces, the less she is paid for each of them. Any photographer’s natural motivation will be to produce enough work to satisfy the expectations of the client, and no more. That is no way to run a business.

A much better fee structure is one that links the photographer’s compensation with the value to the client. My normal starting point for a medium-sized corporation and a middle-of-the-road photographer would be to quote a modest day rate (usually around 2400.00 plus expenses) which would include unlimited use, excluding advertising, of up to 8 images. Then I’d price additional images at 300.00 each (plus file prep). That way, the photographer is incentivized to be as productive as possible, and the client gets the benefit of committing to a low cost up front and then just paying additionally for any additional images that they pick. (Naturally, this pricing could be higher or lower depending on the nature of the pictures, the caliber of the photographer and the size of the client.)

Generally, I try to steer clients away from “unlimited use of all the pictures forever”, because it unnecessarily drives up the fee. There are many ways to satisfy the client’s need to use the pictures broadly. The photographer can license “unlimited” use in a limited way by restricting the time, geography, and/or realm of use, while leaving other parts unrestricted. Are the pictures really going to be useful after a few years? If not, why pay for forever? Do you really plan to use the pictures in Indonesia? Then why pay for international use? Do you really intend to put the pictures on billboards? If not, why pay for outdoor advertising use? When the photographer and client each understand what the other values most, they can come to an agreement that works best for both of them. (That’s known as a “win-win”.)

In addition to corporations, ad agencies seem to be increasingly interested in creating image libraries. We recently quoted on a project for a west coast ad agency who was working with a theme park client that needed a variety of pictures for use on their web site and in advertising. The agency asked us to quote a four day shoot, where the still photographer would work along-side a video crew, photographing families enjoying the various rides and attractions in the park. (See our related post on working with video crews here.)

In spite of my best efforts to persuade the client to agree to more specific licensing, they decided they really did want “unlimited use of all the images forever”. Determining an appropriate fee depends on a number of factors. Here are the questions I asked the art buyer (and the answers I got):

Who is the end client and how prominent is their advertising presence? (In this case, the theme park was a household name, but aside from the web, their advertising presence was not very prominent outside their region.) The larger and more prominent the company is, the more they stand to gain by using the photos. (In a normal licensing situation, the client has to share how they intend to use the pictures because it becomes part of the actual agreement. With any kind of unlimited use, the client has no obligation to tell you how they plan to use the pictures. And in fact, it’s in their interest to down-play their intended use. In these cases, it’s prudent for the photographer to overestimate, by a decent margin, the probable use by the client.

How many situations do you want to shoot in those four days and what level of production are you looking for? Would you rather cover more pictures with less production value (lighting, hair/make-up, props, wardrobe) or fewer situations with greater production value? (We’d like to cover variations of about a dozen different situations. We’re looking for a “real” look, so the pictures don’t need to be overly produced.)

Will the shoot days be consecutive? (Yes.) Just as you would discount your per image rate for multiple images, it makes sense to offer a lower rate for consecutive shoot days and a higher rate for non-consecutive because you can be more efficient with your own time on consecutive days, and you can typically get better rates from your subs as well.

Do you have a shot/situation list you can send me? (Not yet. We’re still working that out with the video crew. That list will be used as a starting point for the still photographer, and then we’ll work from there. We’d like to do a scouting trip with the photographer to determine which rides/attractions would offer good picture opportunities.)

How many final images do you expect to use? (It’s hard to say how many we’d actually use, but I’d like to see between 30-40 useable images per situation.)

Do you want us to deliver raw or processed files? (We’d like to have raw, color corrected images.) This can be a welcome change from the normal retouching and approval process. But the downside is that you are relinquishing control of the final image quality, and your ability to charge a fee to supervise that process as well. The down-side for the client is that they take on the responsibility of that processing, and they risk not getting the full impact of the photographer’s vision.

Thankfully, the art buyer was sensitive to the demands of working with a video crew and was very communicative regarding any overlapping production expenses. (For more on shooting along side a video crew, check out our previous blog post on the subject).

After considering all of the factors, we came to rest on the following:

(By the way, It’s very important for the photographer to convey the licensing to the end client rather than the ad agency. Otherwise, the agency would potentially be in a position to use the pictures for another client without further compensation to the photographer.)

A few notes about our production expenses:

In this case the “grip” was basically a 3rd assistant whose job was to be primarily rigging lights and managing underwater camera housings for the water attractions.

The groomer/wrangler is responsible for making sure the talent was where they needed to be for our shots and ensuring they were camera ready. You have to be careful when working alongside another production. They can handcuff your shoot should they dominate the talent’s time.

It’s unusual to charge for both digital capture and digital tech but due to the high volume of images generated on a shoot like this, the digital tech can’t keep up with the file management. So their job was to bring their workstation and display, transfer images intermittently when not needed on set and during breaks, and process a handful of images for review. This left a fair amount of basic workflow for the photographer after the shoot.

If you have any questions, or if you need help estimating or producing one of your projects, you can reach me at jess@wonderfulmachine.com

Real World Estimates – Publicity Pricing and the Value of Subject Follow-Up

By Jess Dudley, Wonderful Machine Producer

A typical magazine assignment generates a modest fee, a couple of portfolio pictures, a little notoriety – and if you’re lucky, it can also provide an opportunity to make valuable connections with people who can give you work. Follow-up is key to capitalizing on those connections.

Though your subject or the contact person on the shoot might not be the ones who hire photographers for their organization, they probably know who does, and they will often have an influence on that process. When you’ve completed your shoot, find out from them who would be most appropriate for you to reach out to.

After a magazine has published the story, it’s normally okay to let the subject and their handlers see the outtakes from the shoot (certainly not before). Sending a print of your favorite picture from the shoot or a link to a web gallery is a great way build on the rapport that you developed during that assignment.

Explain that if they like them, they can license the images from you when the magazine’s embargo period is up. And that they can hire you for assignments as well. All things being equal, people are inclined to work with photographers they’ve met, like, and even better – ones they’ve seen in action. Don’t assume that a subject will know that you’re interested and available to work for them. Tell them so.

This strategy paid off for one of our photographers recently after he photographed a hotel executive for a business magazine. After the article came out, our photographer sent the subject and their corporate communications director a link to the pictures. They responded that they might want to use some of them in their press kits. We sent them a quote, then heard nothing for months. Eventually, they called to say that they needed pictures at a different location instead. So they asked us to work up a price for a new shoot.

Whenever I quote an assignment, I think (broadly speaking) in terms of time, materials, and licensing. I’ll want to understand what the final picture(s) need to look like, what we have to do to create them (factoring in all the production elements), and how the images will be used.

Here’s how the client described the pictures they needed:

Two different group portraits of eight people from their branding team, shot at one of their hotel properties

Here’s the licensing they needed:

Publicity and Internal Collateral Use forever

Here are the questions I had for them, and their answers:

Q. What are the locations that you’d like to consider using?
A. Both were local to the photographer.
(We’ll need one scouting day, paying attention to the time of day in anticipation of any outdoor pictures we might do.)

Q. Would you like to have professional hair/make-up?
A. Yes. (With eight subjects [more than half of them women], we’ll need two people doing hair and make-up. We’ll stagger the subjects’ arrival times somewhat to minimize the wait time for everyone.)

Q. Would you like to have a wardrobe stylist, and pull wardrobe?
A. No. The subjects would each bring two sets of clothes.
(Our regular hair/make-up stylists also have wardrobe styling experience. I’ll have them bring a steamer and they can tweak the wardrobe in a pinch.)

Q. Would you like us to arrange for catering?
A. No. The hotel will provide food and drinks for the cast and crew.

If this had been an advertising job, I wouldn’t have asked any of these questions. We would naturally plan on all of that stuff. But a publicity project like this is naturally going to be more modest in scale. Getting a sense of proportion from the client ahead of time will put our initial estimate pretty close to the mark. And when the client or subject is providing catering, wardrobe, or other production elements, it’s important to specify that in the estimate to avoid any confusion later.

I didn’t need to ask any more questions to decide on the other expense items. I knew it would be overkill to have a separate digital tech on site (in addition to me producing), so I decided to handle both myself. (Turns out we ended up moving around so much, and so quickly, that a digital tech was impractical anyway (and I’m a pretty good assistant when I need to be!) The client was happy to look at the LCD on the camera, using a loupe.) Photographing eight people in a big space would require a moderate amount of lighting equipment and two assistants. That was the extent of the production elements we needed to include in the quote.

In terms of licensing fees, Publicity Use and Internal Collateral Use have moderate value. Publicity Use is when a company gives away photos to publications to encourage them to produce stories about them. It’s impossible to predict how much mileage a company is going to get from those pictures, but it’s somewhat proportional to the size of the company.

Internal Collateral Use has a relatively small audience, generally limited to publications aimed at the company’s employees (usually in the form of a newsletter or intranet use.) So that value is also somewhat proportional to the size of the company.

Then there’s judging the value of “forever”. With some exceptions, publicity images showing staff people are going lose value at a pretty steady rate over the first few years, and be nearly worthless after five years. Clothes, haircuts and trends go out of style, and the subjects will age and change jobs. So licensing the photos forever in this case isn’t as valuable as when the picture is of something that won’t change as much over time. In this case the photographer was shooting group shots of trendy employees of a trendy hotel. So as a practical matter, the shelf life of the photos is just a few years.

I like to build estimates using a per image licensing model. It’s the best way to create a win-win for the client and the photographer. The client doesn’t have to commit to a ton of money for the pictures upfront, and the photographer is incentivized to be really productive.

I decided to quote the pictures at 1500.00 each plus expenses. Here’s how the estimate and terms & conditions looked:

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The client signed off on the estimate.

After a quick scout of the two locations, the photographer determined that one of them clearly had more and better options to offer than the other. So that choice was easy. To make the shoot day more productive, the photographer went back to the chosen location and shot about a dozen quick test pictures and printed them out. The morning of the shoot, the photographer and client reviewed prints of the different situations and picked five to concentrate on.

The shoot went well. We ended up squeezing in six situations. The client loved having all the choices, along with the option to license more images in the future. And it was all due to some good-old-fashioned publicity of our own.

If you have any questions or if you need help estimating or producing one of your projects, you can reach me at jess@wonderfulmachine.com.

Real World Estimates: Day Rate vs. Space Explained

APE: When I worked at Outside Magazine we had a flat day rate for assignments but then had to create all these other rates to accommodate certain photographers or certain situations where the use was more extensive. It turned into a huge mess where we didn’t know what an assignment would cost and we would need to pull old invoices to see what we paid someone last time. When I went to Men’s Journal I redid the system and changed to a day rate against space structure which was much more elegant and logical. A fashion shoot that took one day but had 8 pages of images resulted in $3200 for the creative fees, which was more reflective of the level of talent we were pulling from and the overall amount of work that went into that one day of shooting. It’s good to see Wonderful Machine shedding some light on this concept in our monthly column, because it works well for both the magazine and the photographer. When shoots are “killed” some money can be saved and photographers have a guaranteed minimum but are paid based on the total usage.

By Ben Weldon, Wonderful Machine Producer

Many magazines have contracts with rates and terms that they offer to photographers (which are generally negotiable). Others don’t have their own contracts and instead work on a case-by-case basis with individual photographers. For those situations, it’s good for photographers to have a contract template on hand. We tend to structure our editorial fees based on a day rate against space. It’s an elegant solution to the problem of how to scale editorial fees, and it’s widely used by many national magazines, but some people find it hard to get their head around at first.

Pricing for editorial photography tends to be different from commercial photography for a couple of reasons. When a company decides to produce an ad or brochure, they already know what they need (in terms of photo display and usage) before the photographer is brought in. So it’s mostly a matter of the photographer coming up with a price and terms to fit those unique specifications. Magazines, on the other hand, need to work much more spontaneously. Editorial opportunities often come up on very short notice, and they also tend to morph from the time of the assignment to the time of publication. When an editor and art director send a writer and photographer out on a project, they never know what they’re going to come back with. And the play in the magazine is going to depend largely on how interesting and relevant that result turns out to be, compared to other stories that they’ve got cooking.

So photographers and magazines are best served by a contract that can be put in place for a couple years at a time (which allows for last-minute projects) and is scaleable (to account for variations in the amount of time required, expenses and the number and size of the pictures used). After all, it’s reasonable to charge less for a project that takes a day to complete vs. one that takes a month. It’s reasonable to charge less for a project that you can do alone in your back yard with a fill card than one that you have to take a crew of 7 and a dozen cases of rental equipment to Tunisia for. And it’s reasonable to charge less for a 1/4-page photo inside the magazine than a cover and 10 pages in the well.

The day rate vs. space structure takes all of these variables into account. The day rate is a minimum guarantee that compensates the photographer for his time on the project. It tends to be fairly modest, to accommodate small projects that won’t have a big presence in the magazine. The space rate comes into effect only when the magazine ends up using multiple or large pictures. The expenses are what they are. The structure nicely scales from small assignments that the publication can have done inexpensively, while incentivizing the photographer to produce a lot of great pictures. And it minimizes the need to renegotiate after the fact, when the final piece in the magazine is different than imagined.

Here is our standard day vs. space agreement (in Adobe PDF ):

dayrate1

And here’s an explanation of each paragraph:

Continue Reading

Real World Estimates: A Mash-Up of Product and Architectural Photography

By Jess Dudley, Wonderful Machine Producer

I recently helped one of our photographers estimate, negotiate and produce an architectural interior/product shoot. The client was a high-end furniture manufacturer in the northeastern U.S. working with a mid-sized ad agency in the southeastern U.S. And the project was to create a series of ads showing entertainment centers in beautiful residential settings.

Though this project has a lot in common with many routine architectural interior assignments, it ended up being worth much more. Most architectural assignments come from architecture firms, builders, or building owners, not ad agencies. And even though pictures from those assignments sometimes get used for advertising, the primary use is typically for brochures, web sites, publicity, portfolios and contests. It’s fairly customary for architectural photographers to charge a day rate (often around 2000.00 – 3500.00, depending on how much the photographer is in demand) plus expenses (capture fee, file prep, equipment fee, assistants and travel), for up to about 5 pictures. Architectural photographers can also often bump up this fee by licensing the pictures to related clients for the same property (like the architect, builder and owner).

This job was different because it was specifically shot for advertising use, it was a product picture more than an architectural interior, it required a fairly high degree of styling and other production, plus there were models and special retouching to boot.

Our estimating process normally begins with the photographer speaking to the the art director about the creative requirements of the job, and me speaking with the art buyer, art director or account executive to understand the licensing requirements. I then talk with the photographer so I know what production elements we’ll need in order to support his/her creative approach.

The art director will explain the concept to the photographer (sometimes with sketches or swipe art). And it’s up to the photographer (along with some input from me) to figure out the most effective approach. In this case, the job was to show entertainment centers in a beautiful home. The photographer had to decide whether it made more sense to build a set in a studio, or to work on location. Some photographers might opt for one or the other depending on their past experience, comfort level, and of course factoring in time considerations and cost, in addition to how it will affect the look of the picture. In this case, we proposed to shoot the job on location.

Another important creative aspect of this shoot was going to be the room styling. You can be the best photographer in the world, but if you don’t have anything to photograph, you’re sunk. And while there are many photographers who shoot interiors that are already styled in advance, a project like this requires the photographer to help conceive and direct the room styling. And to do that requires having a working relationship with a stylist who is going to understand both the sensibilities of the photographer and know what’s appropriate for the client and their specific project. We were able to show the client pictures that demonstrated that our photographer had a lot of experience collaborating with a very talented stylist, and this gave the client the confidence that we would deliver a high-quality product.

I’ve found that art buyers are often more comfortable talking money with an agent rather than directly with the photographer. That way, nobody’s taking anything personally. It’s just business. If they really want to work with that photographer (rather than just fishing for a price), they will often cut right to the chase and give the agent a good idea of what their price expectations are. That’s not to say that an agent should simply offer up the price the client wants. But it certainly saves a lot of back-and-forth for both parties when the photographer can scale the project appropriately.

There are times when a client either doesn’t have a particular budget, or they don’t want to say. If the client is inexperienced handling that type of project, the photographer/agent may simply have to work harder to understand what’s at stake in order to deliver a proposal that’s in proportion to the overall goals and wherewithal of that client. Sometimes, the client doesn’t want to say what their budget is because they might want to see several completely independent approaches that they can choose from. Again, in those cases, you’ll be forced to make an educated guess at the level of production the client might want. But regardless of the client’s price expectations, the actual picture requirements and the licensing needs will largely determine the value of the job. It’s also important to understand that the low bid does not always get the job. Sophisticated clients will be reluctant to work with photographers whose bids are “too good to be true.” Most good clients are looking for good value, not cheap prices. So pricing a project appropriately, and in proportion to all the specs, will give you the best chance of landing the job.

After getting the photographer’s thoughts on his creative approach to the project, I spoke with the art buyer. And as is often the case with relatively small advertising projects, she was a little vague about the licensing she needed. After I explained that the price was going to be heavily influenced by those variables, she decided that she wanted a quote on Advertising, Publicity and Collateral in the U.S. for 2 years.

Still unknown, though, was the number of images they were going to need. It’s actually not that unusual to not have all the information you want when it comes time to construct an estimate. What’s very important to remember, though, is that even in cases where your client is vague, your quote will have to be specific. If the specs subsequently change, you can revise your quote accordingly. In this case, I chose to work up two versions of the estimate to show the cost for 4 pictures and the cost for 6. I offered a fairly deep discount on the last two pictures to give them an incentive to do more rather than less.

Estimate Version 1
Estimate Version 2

The client opted for the 6 image estimate.

After we received the signed estimate, the first thing we needed to do was find the locations. Prior to estimating, the client expressed an interest in shooting at two of the many beautiful homes in the photographer’s portfolio, one contemporary and one transitional (you have to learn your vocab when working with architectural clients: modern, transitional, traditional, contemporary). This made scouting a snap. The photographer pulled his files of the homes that fit the mold and presented them to the client. They were so enamored with one of the locations that they chose to shoot both days in the same home.

A nice benefit of shooting both days at the same location was that we’d need less setup time/breakdown time, and it gave us more time for pictures. The client decided that they’d like to add a seventh shot and try out a few variations of the others, including adding models. As I was working up the revised estimate, I decided to simply pro-rate the seventh shot, but I felt that the variations with the models were worth more than the others. The models changed the feel of the pictures significantly, and required another skill set from the photographer. Also, a whole different ad concept could be developed around these new model variations. As such, we felt they should be licensed independently of the original shots.

Also, the client inquired about several exterior stock images to retouch into the windows. The photographer had a stock library for just such occasions. For nominal fees he licenses exterior stock images to drop into windows, turning an ordinary residential bedroom with a view of the shed in the backyard into a hi-rise condo with a view of a metropolitan skyline at sunset.

So we worked up our final quote – adding in the models, the additional situation, and the exterior stock images:

Final Estimate

The client accepted that, so I sent over an invoice for a 50% advance:

50% Advance

Now the production went into full swing:

I coordinated the location. The homeowner agreed to our location fee and allowed us to store furniture and equipment overnight.

I collected location and model releases. It’s very important to get signed releases. Otherwise, the client will not be legally entitled to use the location and models’ likenesses to advertise their product. You don’t want to spend all that time and money producing a shoot only to later find out that the homeowner or model wasn’t clear on your intentions.

Coordinating with the stylist was the most time consuming portion of the production. The rental location gave us a great start, but we had to consider whether the existing carpet, paint colors, drapes, and props were appropriate, and what we needed to add or replace. We had many, many conversations between the stylist, photographer, and client to get all the details right.

Hiring, renting and managing the assistants, digital tech, equipment, caterer, and models was pretty straight-forward. Between the photographer and us, we have a long list of regular sub-contractors, and we also keep a thorough vendor database that we can use when we need to.

Though very hectic, the shoot went smoothly. Between all the shuffling furniture from room to lawn to room, moving around lights and digital cameras and workstations, art directing and shooting – there was never a dull moment. We squeezed in all 7 shots, no holes were punched in walls, and the client was very happy with the results.

Once back in the office, I began the tedious (but important) process of copying all of our receipts and organizing the invoice. We keep meticulous records of every expenditure so that everything is accounted for, everyone gets paid properly, and the client gets billed appropriately. Also, I try to present it in a way that makes it easy for the client to understand. I put copies of receipts in the order that the line item shows up on the invoice. And if a receipt isn’t self-explanatory, I indicate exactly what it’s for. After a long day of scanning and collating, I sent over the final invoice:

Final Invoice

For more information on Wonderful Machine’s consulting services, please contact Jess Dudley at jess@wonderfulmachine.com or 610.260.0200.