Ask Anything – The Buyout

- - Ask Anything

Former Art Buyers and current photography consultants Amanda Sosa Stone and Suzanne Sease have agreed to take anonymous questions from photographers and not only give their expert advice but put it out to a wide range of photographers, reps and art buyers to gather a variety of opinions. The goal with this column is to solicit honest questions and answers through anonymity.

QUESTION:

I wanted to ask you about a common thing I have been asked by my larger clients. They are asking for buyouts on many images, which can be good, however I am not sure what to charge that is fair and still keep them as a client.

I know it’s a delicate balance, I can say that they are large corporations, and some are smaller companies that have a license on different products. I think I lost work because some clients can only afford to pay for photography and retouching fees, yet they want a bunch of end uses: internet, Direct Mailers, Promotional items and in store imagery.

I have no idea how to keep them as a client, and get paid fairly, yet not have them totally take advantage of me.

It is a constant effort to educate my clients about image usage, some are great about it and ask permission while others I find out that they run my images in ads when I find them in magazines. Then I have to have a dialogue, invoice them. Kinda awkward but they still send me work.

If it helps I am in NYC. I do not have a rep, I am solo freelance still life/editorial studio.

Amanda and Suzanne: There is not ONE equation you can apply for every client – but we hope you can find YOUR equation that works for you. If you can be guided by the answers below, evaluate the project as a whole that is being requested to estimate and find your comfort zone to estimate the request confidently. If our community can feel comfortable doing this, we know it will raise the bar for everyone.

ANSWERS:

ART PRODUCER #1
This a always a hot topic for discussion in my world. Most of my clients want this buyout option. However, in hoping that I don’t seem like a word/usage snob, I like to educate my clients that what this means to them really is an exclusive, unlimited in perpetuity buy. The photographer is never going to completely give up their rights to any images and should be able to use this on their website or for any promotional use. I will also say that I’ve had to refer clients to our signed estimate and what the usage terms really mean when I’ve gotten calls from clients asking me to call the photographer and request that their image be removed from their website/promo material. Yes, this really has happened. Usage terms can really be a huge deal, especially when national exposure is involved. It’s hard to give a specific number to use as a guide for this sort of buy just because for me, it’s usually evaluated on an individual basis. Just keep in mind that not giving this use away for free (or a lower than market value dollar amount) may cost you business, but it also may cost you future business from other clients. So think about this when negotiating costs for this extended use. I want to know for whom a photographer has shot (and will research this) before getting them involved in a project (so that I don’t walk into any surprises with my creative team or client), and may not think of them as an option if they have shot a campaign for a competitor. I can combat this if the campaign images are no longer active.

It’s all kind of crazy in my mind though and I know I’m preaching to the choir when I say that I don’t think I’ve ever seen anyone use an image for more than 5 years. (And that’s stretching it.) Even with an image library, it would most likely be re-done after 5 years so existing work doesn’t look dated. We all know that 2 years is probably plenty. Whenever I’m asked to work off a “buyout” or exclusive, unlimited in perpetuity buy, I always get two additional usage options (outside of the unlimited use, if the photographer will even sell those rights) that are closer to what the client is actually going to use them for. One usually spot on with the proposed media/campaign element plan and another a little larger to allow the client some flexibility so that they don’t feel so boxed in.

ART PRODUCER #2
Sadly, we’ve lost years of client education with the reduction in the number of seasoned art buyers. Art buyers were often the first to go in the layoffs. Now people doing the art buying are folks that haven’t got a clue about the ins and outs of fair compensation.

Don’t shoot the messenger, but from what I’ve heard from local photographers, the clients they are working with that even ask about a “buyout” don’t want to pay anything additionally for them. Despite the “renting not owning” argument, with pinched budgets, clients have a hard time understanding that they paid for all the inputs but do not have all rights to do what they wish with the images. These photographers have tried everything to educate the clients, but with the market the way it is, the client will have no problem finding someone to shoot it without charging additional usage.

That said, I urge photographers as a group to consider what now constitutes “ownership” now that 100% of the time, images are retouched/enhanced/completely recreated by digital artists. Who truly “owns” the final work? I would hope that the art director also had input into the creation of the image with their layout and with their direction. Isn’t it more of a collaboration now than ever before?

ART PRODUCER #3
First, if you’re finding your images somewhere they shouldn’t be, there is no awkward situation- they need to pay you and they know it. If it happens on a regular basis, after educating them, they are not as good a client as you think.

Now, you’re right, most clients don’t know the difference between buyout and 3 months internet use. They only see photography of their product. And with today’s economy, they want to get as much mileage as possible out of that image. The main question you have to ask yourself is, “will I be able to use this image for any other client/purpose?” If it’s a specific product and/or client specific image, the fee should be easy to swallow for your client considering the outside use will be limited. As the image gets more ambiguous, you need to determine what other realistic possible uses there are for it. Like the blue book value of a car, the more options you add, the more expensive the car. It should also be handled per client. Larger corporations would pay more then mom and pop shops. But standardize it for each client (a still life image on silo is $xxx.xx, a still life in the environment is $xxxx.xx, a lifestyle is $xxxxx.xx)

PHOTOGRAPHER:
For my larger national clients that make it a requirement to “own” the images, I have this in my contract:
“unlimited time and usage for Worldwide distribution. Photographer retains promotional rights with permission and copyright. No third party rights granted.”

To Summarize: A term we like to use is “Unlimited Use in Perpetuity” if they request a BUYOUT…and be sure to add as noted above “Photographer retains promotional rights with permission and copyright. No third party rights granted.” The simple equation is: what are they asking for + what is the industry standard usage they are asking for – what is their realistic budget = what are you willing to shoot this for without walking away from this project and losing this client.

Call To Action: Figure out what you are comfortable with asking for and if you can’t find that comfort zone, ask your peers for support on forming this structure for yourself and your business.

If you want more insight from Amanda and Suzanne you can contact them directly (here and here) or tune in once a week or so for more of “Ask Anything.” Amanda and Suzanne review your comments for 2 days, and then they are off researching next week’s question.

There Are 18 Comments On This Article.

  1. Good news, bad news. Bad News: I lost a job this past week because they wanted unlimited rights for a job but only had a budget to cover 2 years of usage. I stood my ground, explained myself and presented an estimate for what it would cost for what they wanted. Good News: Agency called me and said this bidding experience made them realize a few things; 1- they had to simplify this current job to make it happen in their budget and 2 – to obtain the quality of work the client is asking for with the usage, they are going to have to be better prepared for the next job they do with the client and will plan to adjust their photo budget higher to allow it happen.

    I may have lost this job, but feel confident I will be working for them in the future at the right price. I like to think this was a win for me and the industry.

    • Amanda & Suzanne

      @Casey Templeton, Thank you for raising the bar. And for the client to call you back says they are ONE SMART client and I am very impressed with their insight and willingness to share their feedback to you.

  2. There’s nothing wrong with firing bad clients and/or walking away from bad deals – make enough bad deals and you’ll quickly find yourself out of business.

      • @Ed Hamlin, I don’t know, I didn’t see the show. It’s good advice though – the best marketing is taking care of your good clients.

        • @Shane, No totally the opposite, treat people with respect and be the best business person you can be which one reason I read a PE.

  3. Stand your ground, you’ll win some and lose some, but you’ll never feel like a chump for running through brick walls for undeserving clients for nothing or far too little.

    My experience has been that when you stand your ground:
    1) The designer/ad agency is usually fine with your price because they know it’s fair.

    2) If they come back saying “the client thinks it’s too expensive”, ask what they want to spend, then tell them what you will give them for that budget. In this case I use the same formula to do each shot I did in the estimate, and tell them I can give them a number of shots that is proportionally fewer to the number originally estimated. Often they go for this number of shots, at your original price per shot. The formula is something like: Price = (Post $/shot x # shots) + (Usage/per shot x #shots) + (Time for adjusted # of shots x Rate) + Expenses.

    3) When they’re “not sure” of the exact number of shots, price the number they think they’ll need, and tell them what extras or few will cost per shot if you can. Your numbers may not be dead on, but that’s why they call it an estimate.

    The info at the following can be adapted for Photography as well. http://ht.ly/1VU4R

  4. I’ve found it helpful to explain that if they want a “buyout” or unlimited rights, then I’ll have to price that assuming that their use will be the absolute maximum–international ads, billboards, etc in perpetuity. So it’s going to cost a lot of money. They usually respond that their usage won’t be nearly that extensive, at which time I point out that they don’t really need a buyout then–it’s more cost effective for the client to only pay for the usage they really need.

    Also, the term “buyout” can mean quite different things to different people, so it’s important to strictly define it. I like the quote from Photographer:

    “A term we like to use is “Unlimited Use in Perpetuity” if they request a BUYOUT…and be sure to add as noted above “Photographer retains promotional rights with permission and copyright. No third party rights granted.”

  5. This is a never ending issue. Are they really going to use these pictures for ever? This argument rarely works but I try it every time. I can already feel the industry strengthening – competitors not undercutting nearly as much and clients shopping for what they want, not just the price they want. Its only a matter of time before we can get what we are asking for more often or talk them out of demanding what they don’t need. Go Casey!

    • @Callie Lipkin, I get this feeling too. I hit a new record last Friday knocking a buyout request down to a 2 year license in under 5 emails. I think a big part of it comes from finding out your clients needs. In this case they wanted to publish the images without attribution, to do that they thought that they had to obtain the copyright. A little bit of client education combined with a strengthening industry and we can all go back to fighting tooth and claw amongst ourselves.

  6. I also like the “unlimited use in perpetuity” and sometimes enhance that with “for web and print use”. I find it that clients are much more accepting of this language and that I can then limit the number of photographs they can use and include in the contract an amount (usually about 10-15% of my fee) for the use of each additional photograph they might want to use at that time or later down the road.

  7. Please take time to look at ASMP’s Best Practices. There are so many ways to skin the cat, but sound advice is available for those who seek it. Jim Cavanaugh is making a Copyright Counts presentation in Atlanta this coming Tuesday. Only two more are scheduled for the year http://asmp.org/asmp-seminar-registration-workshop . If you seriously want to take on “the buy-out”, learn what’s at stake before you bid.

  8. Hope I’m asking this question in the right place. I’m a photographer but I also own an online gallery (http://www.artzillaonline.com). I recently met with an artists who has done some amazing photo collages. My question is this,
    he takes images from magazines and manipulates them to the point where they are almost unrecognizable. Is this a copyright violation? How can I tell if this is over the line in terms of a violation that would put me at risk? The work is wonderful and I really would like to feature it.

  9. Great insight and commentary! In your (collective) opinion, what’s the real value of an image over time? At what point can we apply the Law of Diminishing Return?
    Put another way, asking for Unlimited In Perpetuity only makes sense (if I were the buying client) if I believe that the image I’m paying to produce has VALUE In Perpetuity. Is a big part of answering the request for a Buyout really discovering the Client’s perception of long term value of the image?

    I run a startup talent marketplace and we provide Real People for Unlimited / Unlimited projects all the time (some Pro talent will sign off on Unlimited Use, some won’t) but I’m beginning to wonder if this is simply an opportunity to engage the end client with dialog around their perception of the long term value of said imagery.

    Given there are real Administrative costs associated with self-policing image usage against the Rights agreement, it’s no wonder that a corporate client would love to end-run that responsibility. That’s bottom line profit.
    But do they really believe that a commercially valuable image in the moment, has sustained value over 4 years? or 5?

    This is a sweeping and broad brush I’m painting with but it seems there is a opportunity to engage a client on a deeper level about the importance of fresh imagery, thereby deflecting or perhaps reorganizing their Buyout hunger.

    Spoken from a non-creative (I’m in awe of creative talent btw), marketer and solutions (read, process) perspective. Thanks for your collective wisdom!

  10. I wish to know if it exists a Rule, Law or Regulation for the term “buy out”. Thanks.