Pricing & Negotiating
February 1st, 2012
by Jess Dudley
One of our Midwestern photographers recently asked me to prepare a cost estimate for one of his custom publication clients. Custom pubs look very similar to regular magazines, but they’re commissioned by a single sponsor and they’re designed to reach a targeted audience of customers, users, members or employees. Custom publications can be produced in-house, by custom content firms or by traditional ad agencies and design firms. It’s big business. They even have their own association, the Custom Content Council.
Custom publication estimates can be structured in the same way as a regular magazine contract but the rates tend to vary more widely. If the publication is focused on a commercial brand or product, you can expect to charge more than your typical magazine rate. If the custom publication is for an association or charity, you might get less. And if it’s a magazine for an airline or hotel, which tend to have content that’s comparable to regular editorial (and often contain third-party advertising), the fees will be about the same as regular editorial.
The publication in this quote was produced by a small ad agency. Though they aren’t a custom pub specialist, they are definitely experienced with custom pubs and their client is a Fortune 500 company. The assignment was to shoot an environmental portrait of a worker at a manufacturing facility in New York City that uses the client’s services, plus to provide documentary coverage of other aspects of the factory.
To get started, I called the art director at the agency to learn more about the project:
- Who is the audience? Company employees.
- How often does the publication come out? Quarterly.
- How many copies do you distribute? 500,000.
- How many images do you plan to use? 2-4.
- How many pages have you allocated for the images? 2-3.
- Would you like to see pricing on any other licensing options? 6 Months Intranet.
- We’d like to scout the location the day before the shoot. Will we be able to get access to the facility? Yes. The art director will attend the scout as well.
- Do you have an opinion about the style of the pictures – available light? Strobe? Existing light for the manufacturing shots. Strobe for the environmental portrait.
- Will we need to handle any wardrobe, propping or styling of any kind? Subject will arrive camera ready. No additional styling, props or wardrobe needed.
- Will anyone from the Agency or Client be present at the shoot? Just one art director from the agency.
- Will your AD want to review images on a monitor the day of the shoot? No. No need for a digital tech or display.
- Should we include catering on the shoot day? No. You can just order in lunch on the day of the shoot. The AD will pay for his own meal.
- How many other photographers are you considering? 2.
- Are any of them local to the shoot or would all of them have to travel? All three would have to travel.
- Do you have a budget in mind? Nothing set in stone, but generally we don’t spend more than about 10-12k per assignment.
With all that in mind, I assembled the estimate and terms & conditions:
-For the fee I looked at a comparable editorial space rate as a starting point. If the space at a publication with a comparable circulation (like Details, Latina or Town and Country) was in the 500-750.00/page range including concurrent web use (check out our day v. space rate post for more on how to structure that type of contract). Three pages would be worth 1500.00-2250.00. I looked at previous projects I had quoted for this agency and other similar custom pubs. I considered the prominence of the client and the fact that the assignment was coming through an agency that liked the photographer enough to pay for travel to a market saturated with photographers. I decided that the fee was worth 3500.00.
-We budgeted 350.00 for a local assistant (assistants in New York City tend to be a bit more expensive than in other parts of the country).
-The Digital Capture Fee covers the time, equipment, software, internet access and expertise necessary to create the web gallery for the agency to edit from. For most editorial clients, we charge 150.00-300.00 for a simple shoot (for bigger productions, we’ll charge for a digital tech instead). But 500.00 is more reflective of the actual value of this part of the job.
-We budgeted for 2 tech/travel days. The day before the shoot, the photographer would travel and scout the location. And the actual shoot day looked pretty long, so I planned on a third day to travel home.
-The photographer used his own photographic equipment (in this case, two camera bodies, four lenses and a lighting kit), but we tend to charge a separate line item for that instead of bundling it into the fee. We looked at what it would cost to rent the gear locally, then backed out the baggage charges.
-I got a quote of 468.00 for the airfare, but I rounded up. Airfares can change a lot between when you send out the estimate and when it gets approved. So it’s important to say that you’re going to charge for the actual cost.
-The photographer told me he’d need to check three bags, so after referring to the airline’s baggage policy (25.00 for the first, 35.00 for the second and 125.00 for the third – each way) it came to 370.00.
-Lodging in NYC is expensive (and it’s one of the reasons that we chose to hire a local assistant). I found a hotel near the factory for 378.00/night. Again, I rounded up. I’d rather have the invoice come in a little bit under the estimate than a little bit over.
-The file prep charge covers color correction, blemish/spot removal, minor retouching and delivery of three high resolution images.
-Miles, Parking, Meals, Taxis, Tolls, Certificate of Insurance & Misc. covered all of the estimated miles to/from the departure airport, parking at the departure airport, meals for the entire trip, local transportation in NYC, a certificate of insurance likely required to shoot at the manufacturing facility and any unforeseen miscellaneous expenses that may arise.
-Lastly, just to avoid any confusion, I listed the items that would be provided by the client, the agency and the subject.
January 10th, 2012
by Jess Dudley
A well-known publisher recently commissioned one of our New York photographers to shoot the exterior of a building for the cover of a non-fiction book. The publisher initially agreed with the photographer on a price just to execute the shoot with the understanding that if they decided to use one of the images, they would then negotiate a separate licensing fee.
It’s somewhat unusual for a client to pay for a shoot and not get any reproduction rights to the photos (or at least the option to use the photos at a predetermined price). This is normally a recipe for an awkward negotiation. But in this case, the publisher wanted to get moving on the art, and they were comfortable that they could come to an agreement with the photographer once they saw the photos and once they knew how many copies they were going to print. Worst case scenario, the client wouldn’t license any of the images and the photographer could put them into her stock archive.
The shoot fee the photographer had already negotiated was 3000.00, plus digital capture and web gallery (500.00), equipment rental (315.00 for her own camera body and two lenses), transportation (50.00), meals (50.00) and misc. (50.00).
As it turned out, the publisher loved the pictures and wanted to license one for the front cover of the book, with an initial printing of 500,000 copies. At that point, the photographer asked me to help negotiate the usage fee. The publisher sent over the following contract:
Rights Granted – In consideration of the payment of fees as outlined below, you grant Publisher and its affiliates, exclusive rights to use and reproduce the Artwork, in whole or in part, on the cover of all print and digital world English editions and formats of the Work or derived from the Work, throughout the world, now known or hereafter devised, and for such other uses as set forth below, and for use in advertising, publicity or otherwise in connection with the Work for the life of the Work as set forth below (“Book Use”), and such other formats and uses as outlined below. You will retain copyright in the Artwork itself and all other rights to the Artwork, except that you will not license or sell any rights in the Artwork (including any other photographs from the same photo shoot or artwork substantially similar to the Artwork) for any Book Use. Publisher will own the copyright in the cover of the Work. In the event Publisher receives a request from a foreign publisher to use the Artwork for its foreign translation editions of the Work, Publisher will direct such foreign publisher to negotiate directly with you.
Fees - (a) Book Fees: For all rights granted herein with respect to all Book Use, Publisher will pay you a fee of $ [insert fee here] (the “Book Fee”), following acceptance of the Artwork to Publisher (together with any required releases) in accordance with Publisher’s instructions plus preapproved and documented travel expenses in a form acceptable to Publisher. (b) Fees for Additional Formats/Uses: In the event Publisher elects to publish, use or grant to a third party the right to publish or use the Work in formats set forth below, Publisher will pay you the following additional fee, which will thereafter cover all exclusive uses in that category: (i) CD, DVD and other physical audio and/or video editions: $750.00. (ii) Ancillary/Merchandise: [insert fee here]
In simple terms, they wanted use of the picture in English language editions of the book, in any format, world-wide. They want to use the picture to promote the book. The photographer will retain the copyright to the photograph (including the right to negotiate separately with foreign language publishers of the book), but can’t license it to any other book project. The publisher wants to own the copyright to the cover art containing the photograph. They want to split the licensing fee into three parts: print (book) use, digital (cd/dvd/audio/video) use and merchandising use. They specified that they want to pay 750.00 for the digital use, but have asked us for a price for the book use and the merchandising use.
There’s a subtle difference between a printing and an edition. A new edition happens when there are revisions to the content. There can be multiple printings within a given edition.
The fact that they’re printing 500,000 copies on the first go-around gives us a good sense of the value. But since they’re asking for the right to use the picture on all future printings and editions makes it hard to know what it’s ultimately going to be worth. It’s not unusual for clients to ask for very broad usage. But it’s up to the photographer to figure out whether to quote a big price for big usage or to offer a more moderate price for more moderate usage. In this case, I was concerned that the price for all editions might be too steep, so I chose to amend that language and work up a price for just the first printing (keeping in mind that part of the value of the picture is that it would be used in advertising to promote the book). I also crossed out the line stating that the Publisher would own the copyright in the cover of the Work which would conflict with my “first printing” revision.
To determine the “Book Fee,” I consulted a number of estimates I had done in the past as well as BlinkBid, Fotoquote and Corbis. BlinkBid’s pricing consultant doesn’t seem to cover book publishing and Corbis and Getty require you to contact a sales rep to get pricing. The projects I’d worked on previously were stock quotes for somewhat smaller projects, with print runs of 5000-10,000, and the negotiated fees generally landed around 1500.00. Fotoquote provided a lot of options and good information for this particular use (English language, front cover, 500,000 print run) and suggested a licensing fee between 2173.00 and 4397.00. Considering our revisions, the fact that it was a much better than average photograph, the fact that the publisher had already paid the photographer 3000.00 to shoot the picture and that an additional 750.00 fee would be paid for digital use, we decided to price the book use at 3000.00 for the first printing. The 750.00 fee for supplemental CD, DVD, Audio and/or Video Editions was fine considering all of our pricing sources included the concurrent digital use in the base fee. Lastly, we wanted to negotiate Ancillary/Merchandise fees as needed, since the term is so vague and could include any number of uses. So, instead of inserting a fee, we wrote “to be negotiated separately.”
After reviewing the changes with the photographer and initialing the amendments, we sent the contract to the publisher. They flatly rejected it, saying they did really want those terms. So that left us to decide what the value was, not knowing how many copies the book would sell. Fotoquote suggested a range of 3600-7200.00. My gut instincts told me to double the book rate to 6000.00 for the unlimited number of printings (we left the digital at 750.00). Almost immediately, the publisher came back and offered 5000.00. The photographer accepted the fee and signed the agreement.
The 3000.00 shoot fee and 5750.00 licensing fee brought the total fees for the project to 8750.00. That might seem like a lot of money to some people, but considering that an author’s advance for a big non-fiction book can be $500k, $8500 is reasonable and proportional. Also, as useful as the pricing guides are, they don’t in themselves justify (for better or worse) the value of a photograph. The value ultimately comes down to how much the client is willing to pay for it and how much the photographer wants for it.
One little detail I’m still not sure about are the ramifications of the publisher owning the copyright to the book cover (which of course contains the photographer’s photograph). I can understand that they would want that. I’m just not sure that they need the photographer’s permission in order to resister the copyright to the whole package or to defend an infringement. (See more about derivative works.)
December 9th, 2011
by Bill Cramer
For about six years now, I’ve been shooting assignments for AARP. I’ve mostly worked for their member newsletter, AARP Bulletin. And more recently, I’ve shot a few things for their website. They also have a nice magazine called AARP The Magazine, which has a paid circulation of over 22 million according to Audit Bureau of Circulations. The subjects they have me shoot tend to be senior citizens (as you might imagine) and the stories cover just about anything, from nursing home romances to social security swindlers.
Recently, photo editor Bronwen Latimer hired me to do an environmental portrait of a guy named Bob Dunn, who each year flies from his home in Delaware to play Santa Claus at a mall in Oklahoma. (Interestingly, I learned from him that there are three main companies who are in the business of representing professional Santas, and until recently Kodak was one of them.) The photo was for a story on seasonal workers and Bronwen asked me to make a picture of him at home in his Santa suit. I’m not sure how many photographers would think to put AARP on their list of dream clients, but I’ve always enjoyed working for them. Everyone there is really nice, they pay pretty well, they have a pretty reasonable contract and they have a massive audience.
I’ve found that a small percentage of magazines I’ve worked with over the years have no contract at all. In those cases, I send them mine. Of the rest, about half have a contract that governs assignments into the indefinite future, while others, like AARP, send out a contract for each assignment. When I do get contracts with no time limit, I tend to add an expiration date. Here’s the AARP.org contract (click to enlarge):
Here’s how it breaks down:
1) Assignment. Who my assigning editor is and how the pictures will be used.
2) Description and Logistics. Who the subject is and when the shoot is scheduled. I can’t recall if it was the case here, but I frequently get calls for shoots that have already been scheduled. I find that some clients like to lock down the subject first, then find a photographer who’s available on that date. In cases where I’m already booked for that date, I’ll ask the client if I can check the subject’s availability for another available date rather than turning down the shoot, and often that works out.
3) Due Date. Strictly speaking, my normal schedule to turn around a web gallery is 48 hours. But as a practical matter, I deliver it as soon as I can. I don’t necessarily charge a rush fee even if the client asks to see it sooner than that. My normal turnaround time for reproduction file preps is another 48 hours and I frequently do charge rush fees (usually 75.00 additional for 24 hour delivery).
4) Compensation. I normally get 600.00 or 650.00/day plus expenses (assistant, digital fee, mileage, parking, tolls and meals (when appropriate) for assignments for The Bulletin and AARP.org. Many publications pay based on the actual space the photos occupy in the magazine in addition to or instead of a day rate. But space has never been a consideration because the pictures tend to be small in the Bulletin and on their website. They’re capping the expenses at 700.00, which I think is reasonable for web assignments. They seem to have a bit more latitude on Bulletin assignments (and I suspect even more for the magazine). Most contracts will establish that the photographer is an independent contractor rather than an employee, which is fine. However, there may be situations for some photographers who work at the client’s office/studio and with the client’s equipment, that then should be paid as an employee, with the client matching the payroll taxes.
5) Use. Even though the Assignment paragraph says that the picture is for “online and other digital media,” the Use paragraph says that AARP can use it “in any media provided that the photographs remain associated with the Assignment Article.” It’s vague to me whether that means any AARP publication or whether they’re referring just to AARP.org. They can use it for promotional purposes. Third party use is extra. Even though I think it could be more clearly written, I chose not to try to correct it. However, I’ve seen many cases where magazines offer very low budgets and ask for lots of use beyond the basic first print use and I’ll usually strike most of those extras.
6) Recording. Not sure if this applies to “behind the scenes videos.”
7) Deliverables. They ask that the photographer add metadata to the images. That’s unusual, but perfectly reasonable. (Now I just have to get into the habit of doing it.)
8) Representations and Warranties. Fine.
9) Miscellaneous. The agreement lasts as long as the term of the copyright to the photographs. I’ve never seen that before. It’s fine though, and I don’t know that it makes any difference. We will all be long gone. AARP returned a signed copy of the contract to me, which is really nice. Typically, whoever sends the contract signs it last. In cases where the photographer sends a client their contract, the photographer shouldn’t sign it first, because if the recipient makes revisions, it looks like the photographer agreed to those revisions.
Santa was a good sport, as you can see:
Here’s how they used it: http://www.aarp.org/work/working-after-retirement/info-09-2011/holiday-jobs-for-retirees.html
Here’s the invoice and model release (click to enlarge):
Invoice comments: I always refer to the date of the contract on the invoice so it’s clear which contract applies to that job. I have a full-time assistant, but I find most magazine accounting departments want to see an assistant invoice anyway, so I just create one. I usually charge magazines 300.00 for a web gallery and 25.00 for basic file prep. I normally only charge the client for meals if it’s a full day shoot. This one was just a few hours, so even though we had lunch on the way, I didn’t bill it to the client (though I did pay for my assistant’s meal.)
Release comments: I’m not sure what the “good and valuable consideration” would be in an editorial situation like this, but I don’t normally pay subjects for magazine shoots unless they’re hired as professional models. The release says that the model “understand(s) that AARP owns the copyright to the photos.” Not sure why it would matter why the subject would need to understand that. It contradicts the photographer contract.
Interview: When I cornered Bronwen for an interview, she deferred to MaryAnne Golon who was kind enough to answer a few of my questions. MaryAnne is Consulting Director of Photography & Multimedia for AARP. And for those of you who don’t know, she has had a very accomplished career as a photo editor, including running Time Magazine’s photo department for a while and winning lots of awards along the way. She will be on the POYi jury this year for the University of Missouri and she is an advisory board member for Facing Change: Documenting America (www.facingchange.org), “a group of seriously talented photojournalists and writers creating a historical look at America during these turbulent times.” You can read more about MaryAnne at http://en.wikipedia.org/wiki/MaryAnne_Golon.
I know that AARP hires photographers for AARP: The Magazine, AARP Bulletin and AARP.org. Does AARP use photography in other ways or for other products?
AARP assigns original photography for the magazine, the Bulletin, and the website based on established industry editorial rates and licensing. Other areas of AARP may assign photography for advertising, marketing, and promotional uses across all platforms including print, broadcast, and the web. The Brand area of the Association handles celebrity ambassadors and experts and assigns accordingly either for specific uses or as work for hire.
I’ve read that AARP has over 50 million members. Roughly how many people see the magazine, the bulletin and the website?
All 50 million members of AARP receive AARP, the magazine, and AARP The Bulletin by mail. Web usage by members has been on the rise. Here are some interesting factoids from 2011: AARP.org has 5.5 million unique visitors every month with 825 million individual page views.
How frequently do the Bulletin and the magazine come out?
The Bulletin publishes 10 times a year and the magazine 6 times a year.
How do you describe the Bulletin in terms of the format/paper, compared to the magazine (tabloid, newsletter?)
The Bulletin is AARP’s nimblest print vehicle and is intended to be newsy. It is printed on a high grade newsprint and can very much be seen as a newsletter. The magazine is bi-monthly and is printed on high quality stock and is a glossier lifestyle publication.
How much does the Day Rate vary from photographer to photographer or from project to project?
There is little variation of the day rate unless rights beyond editorial are negotiated up front. The magazine day rate is $800 per day and the Bulletin and website pay $600 per day.
Space has never come up for The Bulletin because it tends to use photographs fairly small. Does the magazine pay space over the day rate when they use a lot of pictures from an assignment or large pictures?
There is no space over day rate at AARP. The rates are comparable or above industry standards and include non-exclusive online and one-time print rights for the publications.
Do you have any thoughts about how editorial photographers are going to have to adapt generally, to the changing marketplace?
Freelance editorial photographers will need to develop multiple client bases if they have not already done so. The editorial market is shrinking in the journalism realm, but growing in other areas including lifestyle, fashion, and portraiture. I think social media is a great tool for freelance editorial photographers to link out to their websites and highlight their recent work. Twitter and Facebook are the giants of the social platforms. LinkedIn is a more serious business-oriented site for posting. There are available platforms, such as Tweetdeck, that freelancers can use to post simultaneously to several sites at once to market their work.
