The Business of Stock: What It Means for Agencies and Photographers
In the second article in our series on microstock and the stock industry, Amazing Aerial Magazine interviews an industry veteran, photographer, and agency owner about the business of stock and what it means for creatives.
Nov 29, 2024
Lee Martin, Sergey Semenov, and Paul Prescott are industry leaders whose savvy understanding of the ins and outs of microstock and premium stock is valuable for other creatives. © Amazing Aerial Agency
By Rebecca Duras
The global stock industry was valued at $3.3 billion in 2020, and set to grow billions of dollars more in the next two decades. Despite the worries about photography’s economic role declining, it is still a massive industry—massive enough to have a place in it for microstock and premium stock, which occupy different niches for photo buyers and photographers.
As it gets harder to earn a living from full-time photography, it is vital that creatives understand the different facets of the increasingly complex business to know how they can find their place in it.
The Business of Stock, From the Perspective of Agencies and Buyers
In some ways, the growth of stock photography has made it easier than ever to be a photo buyer. Lee Martin, a former Getty Images executive currently consulting for Amazing Aerial, remembers the overhaul caused by digital photography and the Internet. “The route to market became so much quicker,” he says in an interview with Amazing Aerial Magazine, listing other advantages that photo buyers now have such as quick turnaround, lower prices, and more photos to choose from.
However, this new age of abundance has created an additional challenge for photo buyers—how to find good photos. Since anyone can upload to microstock, the agency collections are vast, but uncurated, and buyers do not retain exclusive rights to the photos. Digital photography also means that the quality of photos uploaded is declining, as Lee says many photographers are using the “spray and pray” technique.
Finding the right photo quality photo is another problem. Sergey Semenov, director of AirPano and a photographer himself, points out that one thing that sets Airpano’s work apart is the high quality of their photos. “The clients understand they are buying high resolution and very good high quality images,” he says. For big prints, posters, wall art, and other purposes, the resolution is important, but many microstock photos have lower resolutions due to the lower quality of equipment (including cell phones) that microstock photographers use.
The growth of premium stock agencies goes some way towards solving these problems. Photo buyers still have access to large collections of images that they can choose from, but the collections are curated and guaranteed to contain high-quality images, saving them valuable time when looking for images. Amazing Aerial Agency evolved to meet those needs.
Smaller agencies are able to navigate the industry by carving out niches that meet the needs of buyers but may get lost in the vast businesses operated by major industry players. Paul Prescott, founder and CEO of Amazing Aerial Agency, is able to anticipate the needs of buyers and photographers thanks to his decades of experience as a stock photographer, and uses that knowledge to diversify his agency’s income streams. “I think it’s business knowledge that you can’t put all your eggs in one basket,” he explains his process. “Sometimes a new revenue stream works, sometimes it doesn’t, but you just need to try.”
The Business of Stock, From the Perspective of Photographers
For photographers, it is important to know that microstock and premium stock are two aspects of the same industry that require different approaches.
Microstock has low barriers to entry that are forgiving towards photographers at the beginning of their careers, who may not have the portfolio or the connections to get into premium agencies or work with direct clients.
However, for photographers that are a bit further along in their career, the low payouts that come with microstock don’t always make a lot of sense from a business perspective. “The downside is that the price per image got pushed down quite a lot because there were more competitors coming into the space,” explains Lee. “When it becomes quite a competitive marketplace like that, the risk is that in a very fractured industry that the price per image can actually get pushed down.”
Paul Prescott’s experience as a stock photographer inspired his commitment to make Amazing Aerial a premium agency. “I was selling my stuff on microstock and I was earning okay money, but then everything started to collapse,” he says, listing changing algorithms and reduced fees as factors affecting his earnings. After the CEO of Shutterstock recommended that he move towards that agency’s premium platform, he found a lifeline that allowed him to continue the career he loved and inspired him to start his own premium agency.
The way that pricing works in large microstock agencies also disadvantages photographers. Lee explains that most big stock agencies use subscription-based contracts with their biggest clients, and photographers can choose whether or not to offer the images they upload as royalty-free parts of the agency’s subscription. “The price per image in that respect may actually be quite low, but if you don’t have your content in those subscriptions the reality is that you won’t reach those customers directly because of these big deals they’ve got,” he says.
Sergey Semenov from AirPano explains that his agency does not work with microstock anymore because they feel that the payouts do not value the years of experience and expensive equipment that their high-resolution images require, preferring to work with premium agencies such as Amazing Aerial or directly with clients. “That [premium stock] is very good for photographers, that’s satisfying for me that I worked very hard and that I am rewarded with a higher price level than it could be on a microstock platform, the overall satisfaction of me as an artist is higher,” he explains.
The approach to stock also differs depending on the niche that a photographer occupies. Sergey shares that some of his friends that work in seasonal photography or object stock photography are able to make a solid living out of microstock because the cost of producing images is not that high and they can easily mass-produce photos.
However, the calculus is different for travel photographers, who often spend tens of thousands of dollars on airfare, permits, high-end equipment, guides, and more. Sergey believes that the role of premium agencies is to raise the value of travel photography. “The agencies have to work with the client, trying to make them understand the cost of creation of photography, that you have to have an expensive camera, expensive drone, go to remote places where the cost of living and air tickets are significantly higher than going to your backyard and shooting your New Year’s Tree,” he says.
For photographers and managers of smaller agencies such as Amazing Aerial, Lee Martin recommends being very intentional about finding a niche in the industry that matches the unique skills of the creatives involved and which will pay reasonable rates. “I think Paul’s seen a very good, smart niche,” he says.
Photographers and smaller agencies can also leverage the more personal aspect of their businesses to compete with bigger players in their niche. While big agencies may have a larger collection of content, they often offer impersonal customer service, no assistance with finding the right photos, and no idea about who made the photos (or, after the growth of generative AI, if they were made by a human at all). For many photo buyers, a more personable experience is still important. “With all of the technology in the world, people do still buy from people,” Lee says.
Lee’s final piece of advice for photographers is to keep in mind that they are business people now, not just creatives. “I can probably count on one hand the photographers I’ve met over the years that have been very good creatively but also had a commercial acumen,” Lee says. He adds, “That might have been OK back in the day, but today with the exception of very few, you’re not going to be successful if you don’t have a bit of a commercial mindset.” He advises photographers to think of multiple uses for their photos besides editorial images and to develop a proactive mindset of actively reaching out to potential clients or platforms. Networking is also very important, especially for young photographers.
Paul is sympathetic with the struggles photographers face in running their businesses because he himself had to change his mindset when transitioning from becoming just a photographer to becoming a successful agency owner. “I had some kind of blockage in my mind that having money is maybe evil or bad, and I had to work on my mindset. Money is just a possibility,” he explains.
An Industry Full of Challenges for All Players
Various disruptions to the microstock industry are affecting photographers and different industry players as well. These challenges all point to the importance of having different sources of income, such as direct client relationships, premium stock, or other revenue-generating products such as courses for creatives.
One problem that photographers are running into is a mismatch in expectations between large agencies and creatives, sometimes exacerbated by poor communication on the part of an agency. Sergey Semenov is still upset about AirPano’s one experience selling microstock video. “They told us they would keep our price level, which at that moment was a price level of 60 euros per second,” he explains. “They didn’t keep their word and we decided to cancel the contract with them.”
Many photographers have reported similar experiences with big agencies where promised earnings dried up or promised premium rates were replaced by bottom-barrel rates. This dissatisfaction and perceived lack of respect is leading more and more top photographers to turn away from microstock.
The agencies themselves face pressure from clients who are unwilling to pay money for photos anymore. Often, they are actually unable to do so as creative budgets are slashed across the board, especially among traditional publishers that have seen traditional sources of revenue crash due to the Internet. “Photography is sometimes seen as low on the food chain. Photography is an art, not a commodity,” Lee Martin says, explaining that it may not be a priority anymore for media businesses. As a solution for creatives, he suggests looking into other sectors that have healthier finances and creative budgets, such as production companies.
Another challenge facing the photography industry is the growth of AI images. While AI is becoming more popular, it is not high in quality yet (and carries the stigma of cutting corners for photo buyers). Sergey Semenov is confident that for now, the higher quality of the images he and other creatives create can withstand the challenge of AI. “As for AI and any other unnaturally created images, they are at the moment lower resolution,” he explains, and for premium uses they are still unstable. While AI can challenge the microstock market, for now, premium agencies and photographers are somewhat protected.
Among the uncertainty of the industry at the moment, diversifying is the best protection for photographers and agencies. “That’s where I’m trying to be, ahead of the game, looking at trends,” Paul Prescott says, explaining his game plan both with his own work and Amazing Aerial Agency itself. He was one of the earliest adopters of stock video as well as drone photography, and now is diversifying Amazing Aerial’s business towards education, meet-ups, and travel photography workshops. "I think that if you’re not ahead of the game, because things are changing all the time, you’re behind. You have one niche and then it becomes more and more saturated,” he says. “We need to try to be ahead of the game and offer what photographers need and what the markets need, and also at the same time shaping things.”
For surviving the current photography industry, creatives may need to apply the same creative mindset they use for their craft towards the business itself.
Â
Stay updated when we post new articles.
Â
We hate SPAM. We will never sell your information, for any reason.
