Pricing & Negotiating for Commercial Photographers | Phase One Chicago

PRICING & NEGOTIATING Commercial & Editorial Assignments

Bill Cramer/CEO

Copyright

Terminology: Licensing vs. Usage

Charging For Time vs. Usage

Licensing Agreements

Types of Usage

Editorial Contracts

Commercial Contracts

Treatments

Negotiating Points

Pricing and Negotiating

COPYRIGHT ▹  “The exclusive legal right to reproduce, publish, sell, or distribute the

matter and form of something (as a literary, musical, or artistic work)”1 ▹  An image is copyrighted as soon as it’s affixed any media ▹  Photographers grant specific use of images to their clients using a

licensing agreement ▹  Generally, photographers don’t SELL images, they LICENSE them ▹  Work For Hire ▹  Copyright Registration

1”copyright” Merriam-Webster.com. 2012. http://www.merriam-webster.com (16 March 2012)

TERMINOLOGY: LICENSING VS. USAGE ▹  Often used interchangeably, but there’s a subtle difference ▹  License is what you grant to your client that allows them to use your

pictures ▹  Usage is more about what they’re actually going to do with them ▹  You have to grant your clients a LICENSE to USE your pictures ▹  The terms of the license are often different from the actual usage

A Photograph has no intrinsic value.

So how do you quantify it? (It depends on the client, the photographer and the use.)

CHARGING FOR TIME VS. USAGE ▹  Assignment fees are a function of time, skill and usage (licensing) ▹  The time it takes a photographer to execute an assignment determines

the minimum value of the job ▹  Usage (licensing) determines the maximum value of the job ▹  Naturally, you’ll want to charge as much as possible ▹  Value is NOT about what it costs the photographer to create the

pictures, It’s about the benefit your images bring to the client ▹  If you charge for your time but not for usage, you’re probably missing

out ▹  Especially true of advertising projects where it’s much more lucrative to

charge by the picture

LICENSING AGREEMENTS ▹  Client can only use your photos with a licensing agreement ▹  Value is proportional to that licensing, here’s how you define it:

▹  Type of Use (editorial, commercial (publicity, collateral, advertising)) ▹  Prominence (placement, how big, how many, who is the company) ▹  Duration (how long will the pictures be used) ▹  Geography (where will they be distributed) ▹  Volume (number of copies) ▹  Exclusivity (how long before you can license them to someone else)

▹  It’s like appraising a house (sq. footage, bedrooms, bathrooms, neighborhood) ▹  Draw a clear box around the usage you want to allow for a certain price ▹  Licensing agreement defines usage the way a deed defines a property

TYPES OF USAGE ▹  (In roughly order of value) ▹  EDITORIAL (newspapers, magazines, books) ▹  COMMERCIAL (ad agencies, graphic design firms, corporations, institutions,

entertainment) ▹  Publicity – client gives photos to publications for editorial use (press kits, press

releases)

▹  Collateral – client produced and distributed (brochures, annual reports, posters, websites)

▹  Advertising – client pays to place photos in media (newspaper and magazine ads, web banners, billboards, transit ads)

▹  Avoid vague terms like “buyout” or “unlimited”

▹  Web isn’t a usage, it’s a medium

EditorialType of Publications: Newspaper, Consumer

Magazine, Trade Magazine, Book, Other (for Corp. Mag, See Collateral)

PublicityTypes of use: Media Kits, Other

AdvertisingWhat type of media? Newspaper, Magazine, Point of Purchase, Catalog, Billboard, Bus Shelter, Direct Mail,

Packaging, Freestanding Insert, Other

prominence

Anticipated SpaceHow many photos do you plan to use, and

what sizes? Cover? Inside? What about web use, foreign language use, syndication use? Do you want these included or a la carte?

N/ASize of Photo(s):

Are there other photos in the ad or just ours?

duration One Time Use? Other? One Year? Other? One Year? Other?

geographyLocal? Regional? National?

International? Foreign Edition Use? Foreign Language Use? Other?

Local? Regional? National? International? Other?

Local? Regional? National? International? Other?

volume What is the circulation of the publication? What is the advertising page rate?

Number of copies?Number of insertions? Names of publications?

Number of pieces?

exclusivity 30 days from publication or 180 days from delivery, whichever is less. Other.

Proprietary images are exclusive forever, non-proprietary images are exclusive

for one year. Other.

Proprietary images are exclusive forever, non-proprietary images are exclusive

for one year. Other.

creditAdjacent to the photo, or if a cover on the table of contents page, or if a spread, one

large credit.Credit on all prints and slides.

This is a negotiable point. Be sure to get it when you make any other concessions.

PublicityMedia Kits, etc.

CollateralBrochure, Annual Report,

Corporate Magazine, CD-Rom. What is the title of the publication?

AdvertisingNewspaper, Magazine, Point of Purchase, Catalog,

Billboard, Bus Shelter, Direct Mail, Packaging, Freestanding Insert

prominence In what geographic areadoes the company do business?

Front cover, back cover, inside, or both? Will our photos appear with others?

Size of Photo(s): Are there other photos in the ad or just ours?

duration One time? One year? Forever?What is the life expectancy of this piece?

Do you want one time use of photos? One time? One year? Forever?

geography Local? Regional? National? International?

Will the publication be distributed:Locally? Regionally? Nationally?

Internationally? Are there separate foreign editions? Separate language editions?

Local? Regional? National? International?

volume Number of copies? What is the print run?Number of insertions? Names of publications?

Number of pieces?

exclusivityProprietary images are exclusive forever,

non-proprietary images are exclusive for one year.

Proprietary images are exclusive forever, non-proprietary images are exclusive

for one year.

Proprietary images are exclusive forever, non-proprietary images are exclusive

for one year.

credit Credit on all prints and slides.Once in the back of the

publication is customary. This is a negotiable point. Be sure to get it

when you make any other concessions.

“Why can’t we use the pictures any way we want?”

EDITORIAL CONTRACTS ▹  Their contract or yours?

▹  Fee plus expenses or all inclusive? ▹  Day rate vs. Space or flat rate?

▹  Large circulation magazines vs. small ▹  Consumer magazines vs. trade magazines

▹  Custom publications for associations and corporations

▹  “Advertorial” ▹  Typical national magazine rates 500.00 – 700.00/day vs. 500.00 – 1200.00/page

▹  Rates have fallen in the past 5 years ▹  More and more, magazines are offering flat fees

Case study

The Penn Stater Magazine

Cover Shoot

- Brothers. Star basketball players.

- Cover, opener, table of contents.

- Posed, in action, with their family.

Case study

Inc. Magazine Portrait

- Brothers. Run an online wine company

- One inside picture. Full page.

- White background.

- Sitting on wine crates. With and without wine glasses.

COMMERCIAL CONTRACTS ▹  Itemized costs, Terms & Conditions

▹  Costs: Estimate (fee+expenses) vs. Bid (all inclusive) ▹  Use an estimating software like BlinkBid or at least an invoicing app like Quickbooks

▹  Consult pricing guides like BlinkBid, FotoQuote, Corbis, Getty (stock vs. assignment pricing)

▹  Pricing by the day, by the image, by the project

▹  Bundle usage with day rate or separate the two (there is not single right way to do it) ▹  Itemize everything (whether you submit it like that or not)

▹  Specify items that the client is providing ▹  Low bid often doesn’t get the job

▹  Review with a consultant, rep or friend

ASKING THE RIGHT QUESTIONS ▹  What’s the concept of the shoot?

▹  Do you have a shot list and comps? ▹  Who is the client?

▹  What is the goal of the campaign/project? ▹  Who is the audience?

▹  What licensing do you need?

▹  What is the intended use (this may be different from the licensing granted)? ▹  What level of production is appropriate (hair/m.u., wardrobe stylists, prop stylists,

ect.) ▹  Who else is quoting on the job?

▹  Do you have a budget? (leave this for last so you don’t give the wrong impression)

What’s a “media buy” and how does it affect the value

of a photo?

BLINKBID

FOTOQUOTE

GETTY & CORBIS

Case study

Airline Ad Campaign

-  Small multi-cultural ad agency

-  Large airline

-  5 pictures, 1 year advertising use

-  3 of people (in terminal, on plane, in city)

-  2 still life (tickets, wine glass)

TREATMENTS ▹  More detailed proposal for bigger commercial assignments ▹  Explains your skills, experience and client list ▹  Expands on your technical and creative approach ▹  Provides sample images including style references ▹  Details production schedule

NEGOTIATING POINTS ▹  Negotiating is about finding a “win/win” ▹  Don’t give up something for nothing (licensing, expenses) ▹  Never give a quote over the phone ▹  What’s in it for you? Portfolio, experience, relationship, money ▹  Does the intended use match the licensing? ▹  Production responsibilities (what can your client do to help?) ▹  Bid vs. Estimate (heads I win, tails you lose) ▹  Working for free or for cheap (loss leader, get something in return)

THE BOTTOM LINE ▹  Understanding the value of your photography can mean the difference

between surviving and thriving

More Look for a copy of this presentation on our blog this Saturday.

To see dozens of examples of assignment pricing, go to our blog and type “Pricing & Negotiating: ” into the search field

Questions?

Thank you!

(The End)

ASSIGNMENT VS. STOCK ▹  Shoot a new picture or license an existing one? ▹  Which is worth more? ▹  With stock, the photographer doesn’t have to do any (new) work.

▹  The client knows exactly what the image will look like.

▹  The client can get the picture right away. ▹  The client doesn’t always know who else has used a stock picture.

▹  With an assignment, the client can get a custom picture for their exclusive use.