Understand Your Value When Negotiating Fees
Question: How can I negotiate licensing fees and terms? I often wonder if artists are losing their power with image licensing, since many clients want buyouts and won’t compensate appropriately.
The topics of fees and buyouts have always been hot ones in this industry. I think it’s a real shame that equipment has gotten more expensive and the fees and compensation have stayed the same or decreased since 2000. While everyone loves the convenience of digital, it has created more and more loss for the professional photographer. We are seeing more out-bidding by less-experienced photographers giving away all rights while the professional is trying to stand his or her ground. So, what’s the best way to negotiate to be fairly compensated?
1. Understand the Value of the Work
If you’re shooting or illustrating a client’s product that has no stock value for you, then letting them have the copyright for additional compensation is worth it. If the client wants a buyout and you know the styles of clothing or electronics will be obsolete in less than two years, try to get them to agree to two years’ usage instead of a buyout. Remember with usage based in years it is date of first use, since it can take months before the image will be seen because of post-production and printing. It is best to calculate approximately three to four months for print publications, two to three months for printed materials and one to two months for electronic usage.
2. Research the Value of Images
I always like to get a gauge from stock agencies. Many of the largest stock agencies have image calculators where you can search for similar images and then calculate the stock rights based on the usage the client is asking you. The results will be alarming and will give you some leverage in your negotiating. Here’s an example:
I went to www.gettyimages.com and selected a rights-managed image - a royalty-free image is not the proper gauge. I typed in “Little Girl on Phone” and got 824 images, many with phones that are already obsolete - proving my point about electronics. I keyed in the following information:
Individual package for advertising-print, display and TV with specific usage as print ad-magazine and newspaper, up to full ad with up to 2 million in circulation for regional usage for 6 months usage.
The estimated costs were $3,985 for usage. And this is non-exclusive.
With this in mind, you are shooting for clients a custom image with their product for their services that their competitor cannot use, so your fees should be around this rate. Use this information to help in your negotiations.
3. Be Clear in What You Are Licensing
It’s so important that when you’re submitting an estimate - and you should for EVERY job – that you spell out what you’re licensing. I have seen so many photographers and illustrators not state up front what the estimate is based on. If the client asks for two images and you shoot several variations, they don’t have the rights to all images shot. In your estimate terms, state: “Creative fee for execution and usage for two (2) images of little girls on the phone talking to friends.” So when the client sees all the images and wants additional images, you can negotiate usage fees for the additional images. I have several clients doing this with great success. Illustrators should make sure they “cap” the amount of revisions to the work.
4. The Value of You
When you’re negotiating and you’re up against other photographers or illustrators, show the value of what you bring to the table. Create a treatment that shows many images they may have not seen on your website or portfolio that are similar to what they’re requesting. A treatment can also show how you plan to execute the assignment.
At the end of the day, it all boils down to whether an assignment is worth it for you and your career. If it is a great assignment that you feel confident will make a great addition to your portfolio, win awards and help your marketing, but the fees are not that great, is it worth it to you? If it’s a project that you would never show to your dog, but the fees will offer financial gain, is that worth it to you? Or if it’s a project that will leave you feeling used and frustrated, is that worth it to you? Only you can answer that.
About Suzanne
Suzanne Sease currently works as a consultant for photographers and illustrators all over the world, and is also a partner in the Creative Collision video series featured on Agency Access' blog, The Lab. Suzanne has been heavily involved in the photography and illustration industry since the mid 80s, giving her the opportunity to work with some of the most established artists in the business. She founded the art buying department at The Martin Agency in 1988 and left in 1999. She has also worked for Kaplan-Thaler, Capital One, Best Buy and smaller agencies and companies. Suzanne Sease Productions
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