Pricing conundrum

January 21st, 2009
Gwyn Headley

by Gwyn Headley

Managing Director

Setting prices, billing and collecting the cash is one of the most important services fotoLibra provides to its members.

Apparently for rather more than the cost of fotoLibra’s Pro Membership you can buy a software program that suggests prices if you’re selling photographs in the United States. That’s about all it does.

Unlike fotoLibra, it doesn’t store your images, promote them, sell them, deliver them, invoice, collect or pay you money. It leaves all that to you. I am lost in admiration for its business model.

We have 1,447 set prices for rights managed images, derived from a complex algorithm that takes into account Size, Circulation and Repetition. Embedded in this are other licences such as territory and duration. We cover most bases, but occasionally we find we’ve missed something out.

Like today, when we were asked for a price for an image that covered the following rights: editorial use; book; 5 year licence; single territory; 5,000 print run; half page; eight languages.

Straightforward — till you get to those eight languages!

What’s the answer? I’ll post our price here as soon as somebody makes an educated guess.

I wonder how that software program would have coped?

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3 Responses to “Pricing conundrum”

  1. Kim says:

    Okay, I don’t have an educated guess but I’m really interested to know the price..and how you came about it. Please do tell!

  2. John says:

    Is having 1,447 price sets a good thing? Sounds like it’s a nightmare for customers. Photo licensing needs to beocome more simplified.

  3. Gwyn Headley says:

    I agree, photo licensing needs simplification. But you have to forget it’s an image and price the usage instead — hence the 1,447 prices, which as you see from this post doesn’t begin to cover all the required uses.
    What we do have is an effective and efficient price delivery mechanism. It only takes 4 steps to get to the precise price the buyer wants, e.g. Editorial> Books> World All Languages> Half Page. And there’s the price. So it’s not important that behind this simplicity is a complex construct of prices for all purposes — the buyer states the usage, the buyer gets a price. It’s simple — as long as we’ve thought of the usage first.
    The alternative is Royalty Free pricing. The buyer pays according to the size of the image purchased, and no further fees are payable. This won’t guarantee exclusivity, so you could find your competitor using the same image as you are.