Pricing & Negotiating: Spokesperson Advertising Shoot

By Craig Oppenheimer, Wonderful Machine Producer

One of our photographers recently contacted me to help him quote on some advertising photographs for a prominent international corportion. He had recently completed a self-assigned fashion shoot, and a promotional mailer from that project caught the attention of the client’s ad agency. Over the past few years, the ad agency had helped the client completely revamp their image, and in the process they had developed one of the most recognizable campaigns in recent years. The agency had now developed an updated concept (which happened to be very similar to the photographer’s promo) representing the next step in the evolution of the campaign, and they wanted  to consider our photographer for the shoot. After an initial phone call, the agency sent over a shot list and requested an estimate.

Here is what we knew: The project would involve 2 days of photographing a celebrity spokesperson interacting with various props and products in a West Coast studio. The agency was hoping to cover 5 situations per day, including very specific but subtle variations within each situation. These variations were intended to create a range of expressions and angles from which the agency and client would choose their final selects. The shot list for day 2 was almost identical to day 1, except it consisted of shooting against a different background (at the same studio), which was still to be determined based on further creative direction.

The agency would be coordinating and paying for the talent, hair/make-up, wardrobe stylists, wardrobe, props and a trailer for the talent. All we needed to account for was the photography fees, photo crew, equipment, studio and catering.

I wanted to start by determining the photographer’s fees, so my first question for the art buyer was about the usage and number of images. She replied that they needed licensing for all images captured, though they only wanted 10 selects retouched and delivered. The licensing language that she asked me to include in the estimate was:

All print media now known or hereafter invented (to include, but not limited to consumer newspaper, industrial, in-store, direct mail, brochures and any other collateral material, out-of-home (to include but not limited to billboards, bus shelters, wild postings, kiosks, wall murals, window signage and display work), electronic media (to include but not be limited to worldwide web and client brand portal archiving)

Even though the client intended to use up to 10 images in the campaign, they asked that the quote include licensing for all of the images created rather than just a limited number of selects. Naturally, licensing for more pictures is going to be worth more than licensing for fewer pictures. But if we’re shooting 10 situations with subtle variations of each, it’s not going to be worth much more than those first 10. We do our best to reconcile the discrepancy between what they’re asking for and what they’re likely to do with the images. The licensing needed to include advertising use in the U.S. and Puerto Ric o for 1 year from first insertion.

Digging through similar estimates that we’ve done recently and other pricing guides, here’s what we found:

BlinkBid: National advertising use in print publications, on websites, in collateral and on OOH (out of home/billboards) = a range between $9,450 and $13,500 per image, per year, though these rates didn’t quite cover the scope of the use.

fotoQuote: The new version of fotoQuote has “quote packs” that cover a wide range of usage in various media outlets. The most extensive pack is labeled “All Advertising & Marketing.” This pack includes print advertising in magazines, newspapers and directories, as well as web advertising, web collateral, use on mobile devices, promotional emails, direct mail, in store displays, billboards and transit ads along with a few additional items as well. For this use, their suggested range for 1 image is between $16,090 and $32,181 for 1-year use. This is more in line with our expectations.

Getty: They also offer “Flexible Licensing Packs” including one labeled  “All Advertising Pack.” This includes unlimited collateral, print advertising and web use, which is further detailed to include direct mail, electronic brochures, billboards, magazine/newspaper ads, freestanding inserts and directory advertising, web advertising, use on corporate websites as well as on mobile devices, and any indoor or outdoor display. Their price for 1 image in the  specific industry for 1 year is $18,790. Again, this is comparable to what we expect to see on projects of this scale with clients of this size and prominence.

Armed with this information along with past estimating experiences, I decided to price the 10 images at $110,000 for this use. Each of the images generated would be somewhat similar to the others. The photographer wasn’t shooting 10 different concepts, he was shooting 10 adaptations of the same concept. The greatest impact and greatest value comes with the first image. In situations like this we feel the first image is worth the full rate and each subsequent image has a lower value. By pricing the first image at 20,000, the high end of the range for this type of licensing, and the additional images at 10,000 each, the low end of the range, we came to rest on a fee of 110,000.00.

Here’s the first estimate we sent over.

 

In addition to the photographer, we accounted for two assistants and a digital tech. The agency wasn’t looking for any extraordinary retouching or compositing on set, so a basic digital tech was sufficient.

The production day accounted for time to arrange the assistants, equipment, catering, etc.

We included the photographer’s own studio at $2,000/day (the normal rental rate which includes a basic lighting setup and grip equipment) and equipment rental of 1600.00 for a camera system and supplemental lighting.

With a project of this scale, in addition to the work that the digital tech does to manage the files on the shoot day (helping the clients see the pictures and making sure the files are backed up), there will typically be additional time required afterwards to organize, edit and process the images, run web galleries, upload/deliver them to the client. I budgeted 2 digital processing days for that. Then we allotted 20 hours of retouching time to process and retouch the 10 selects.

For catering, we accounted for 15 people at $35 per day for 2 days.

Insurance and miscellaneous accounts for various items that may come up during the production and helps the photographer pay for his standard liability insurance.

We made sure to indicate what production elements the agency had committed to manage and pay for directly.

Still no word on the second day’s background, so we left that off this estimate.

Lastly we highlighted that an advance equal to 50% of the bottom line would be required to initiate production.

A few days after submitting the estimate I received a phone call from the art buyer. Our numbers landed in the middle of the two other estimates she’d received. She wouldn’t reveal names or exact numbers, but did share that the other photographers were not local, and they would be traveling from as far away as Europe. She then told me that all of the estimates would put them over budget, and asked for an estimate limiting the duration to 6 months.

So I had to figure out how cutting the licensing duration from 1 year to 6 months would affect the fee. Of course, I can’t just cut the fee in half. Most ad campaigns are going to have maximum value early on and then diminishing value over time. We generally figure that doubling the duration of use might increase the value by a factor of 1.5. Moving in reverse, if we’re cutting the duration in half, we could divide by 1.5 which would leave us at $73,333. However, at that point I was having second thoughts that my 1 year rate was too low to begin with. So I decided to divide by 1.25 instead which got me to $88,000, and submitted the following estimate:

After more waiting, our contact returned with some news. While they were still deciding on creative direction, she let us know that their budget for set construction for the background on the second day was $10,000. So we included it in the estimate and noted that it will ultimately be based on final creative direction. Also, she told us that instead of using the photographer’s studio, they had a specific LA studio in mind, for which I was able to find rates for.

The additional production coordination warranted bringing on a production coordinator so we added one to the estimate. The photographer had a inexpensive young producer he wanted to use. Also due to the studio change, we had to increase the studio fees and equipment rental fees. He was going to need a medium format camera with a digital back similar to the Phase One P65+ ($550/day) with an 80mm lens ($35/day) and a 120mm lens ($50/day). Also included in the rental would be 3 Profoto Pro7B Packs ($70/day each) with 4 PRO7 heads ($20/day each), as well as various stands, modifiers and accessories.

We then submitted the following revised estimates for 1 year and 6 month usage.

The AB came back and simply asked us to reduce the cost of the 1 year estimate by 8500.00. Remarkable considering the the bottom line. After carefully reviewing the estimate I found that the only thing I could really cut was the licensing fee. One of the most basic rules of negotiating is don’t give up something for nothing. But in this case, that’s what we did. Of course, there’s a range of what constitute a reasonable fee – especially on a large project like this one, and the photographer and I agreed that this one was still reasonable. Here was our revised 1 year estimate:

A few days later, an email popped up in my inbox with the subject line reading “Congratulations.” I was delighted to hear that they awarded the project to our photographer! In spite of our hand-wringing over the 1 year quote, in the end the client opted for the 6 month licensing for $88k.

If you have any questions, or if you need help estimating or producing one of your projects, contact Wonderful Machine.

There Are 17 Comments On This Article.

  1. This is such an incredibly valuable resource. I learn more about the business in one blog post than I do anywhere else. Thank you so much!

    Adam

  2. A great source of information and the thought process that went along with the estimate. I have found that potential clients seem to play hardball and play one photographer against another in order to get the lowest rate rather than the best photographer for their project. It’s good to read about a client that has certain needs but is flexible on the bottom line.

  3. It looks like estimating and negotiating a larger project has become so complex that it’s advisable to get the help of specialists.

  4. Appreciate the description. It’s helpful to see other’s experiencing similar situations. My experience has been very close to the one described. I would add that it’s best to get as much information as possible before making the first quote. It seems always to be the case that the clients have often done their homework, they have a budget and a plan “b.” In fact, I’m sure that in most cases they reach for the world when requesting licensing rights just in case they can get it for the price they want to pay. The more flexibility they get, the more it should cost them. I sometimes think they know they will settle closer to their real needs but they start off with more. They are not trying to rip anyone off, they are just doing what’s in their best interest. It’s usually the case that they back off from buying everything and buy what they really need. To me it’s better to sell them what they need than to sell them things they don’t and have them realize they overpaid. They respect the honesty which in turn means they keep you on their preferred list! Great post. I appreciate the time you put into this, thank you.

  5. I brought Michel Tcherevkoff in to do a presentation for ASMP Austin/San Antonio and was surprised when he said that after all his years of experience he uses a service for quotes. He said they were simply so complex and you could lose the job on a simple line item being missing or outside the norm that he was willing to pay to have the quote done.