Pricing & Negotiating: Portraits of Real Customers for Advertising Shoot

by Jess Dudley Wonderful Machine

Shoot Concept: Environmental portraits of real customers/users on location.

Licensing: National Advertising (Print, Web and OOH) and Collateral use (in all media) of up to eight “hero” images for three years from shoot date. We used specific language requested by the agency: unlimited national print, in-store signage, OOH electronic media and online video use.

Location: Four homes/small businesses in Southern California.

Shoot Days: Three.

Photographer: Seasoned East Coast based lifestyle and portrait shooter.

Agency: Large, based in New York.

Client: Prominent electronics manufacturer with a household name.

Here’s the initial estimate:
Click to enlarge.Click to enlarge.

Here’s how I arrived at those numbers:

Concept/Licensing: The agency came to us with four distinct concepts/ads, each portraying a specific product in use at home or in a business. The client had already selected the talent (real customers), from a casting they did using social media, that considered the subject’s look, their space and their story. The photographer was charged with covering two situations with each person at their home or business; one portrait, posed with product, the other candid, product in use. Since two of the locations were relatively close to one another, we were asked to quote it assuming we could double up the talent and locations on one of the three shoot days.

When determining licensing fees, I usually value the first image higher than the rest. It is not uncommon for a client to build a campaign around a single hero image and then have several supporting images. For projects that feature only one concept/product but ask for alternate talent, wardrobe or slight compositional variations, I routinely set the value of the first image based on the licensing, concept and complexity, then determine a percentage value for each additional image, typically dropping down to 50-75% the value of the first image. The reason being that each of the slightly varied additional images doesn’t go that much farther to help the end client convey their message. In cases where the concepts vary to target different audiences, emphasize different product features, or promote different products made by the same client, I will assign a higher percentage to the additional images, 75-100% the value of the first. In this case, the client makes two different product lines, one for business, one for home. They also make a variety of products within each of those segments. For those reasons, I decided to set the fee for the four portraits at one rate, and the candid variation at 50% of that price.

Considering the use, size/prominence of the client & agency, number of images, various brand messages achieved, volume of work/shoot days, and the photographer’s experience, I set the fee at 8000.00 for each of the four portraits and 4000.00 for each of the candids. For the purposes of the estimate, I bundled it all together as an overall licensing/creative fee of 48000.00. Blinkbid’s bid consultant provided a range of 9450.00-13,500.00 per image, or 226,800.00-324,000.00 for all eight. Corbis quoted 17,500.00 per image for the first year and didn’t have a three year option for the quote pack I’d selected. Fotoquote suggested 30,976.00 per image for the use. None of these resources readily factor in any discount for additional images/variations or the prominence of the client, but they still offer great perspective.

Photographer Travel/Tech-Scout Days: The photographer would need two full travel days and a tech/scout day to get a sense of the locations and talent/subjects before the shoot.

Producer Days: The producer (me in this case) is responsible for coordinating travel, scheduling and crew. This takes the pressure off the photographer. It’s the producer’s job to plan and coordinate the logistics so the photographer can focus on the making great pictures. I estimated two prep days, two travel, one tech/scout, three shoot and one wrap day. When the photographer is traveling, it is not unusual to bring his/her local producer.

First Assistant Days: The photographer would be bringing his first assistant. It is standard for a photographer to travel with a first. Since the photographer shoots with minimal lighting, only one trusted photo assistant was necessary.

Digital Tech Days: The photographer would be shooting tethered to allow for immediate image review and layout composting. The rate included the tech’s fee, a supped up 27″ iMac and all the necessary accouterments.

Equipment Rental: The photographer would be shooting with Canon DLSRs and lenses, basic grip equipment and a few Profoto packs/heads for supplemental light (if needed).

Image Processing for Editing: This fee covers the time, equipment and costs to handle the basic color correction, edit and upload of all of the images to an FTP for client review. Depending on number of shoot days and estimated number of scenarios/images, this rate can vary.

Selects Processed for Reproduction: This per image processing fee for the photographer to handle basic processing (color correction and blemish removal) for the client selects. Anything over and above the basic processing would be considered retouching and be billed at 150.00/hr, which is covered in the terms and conditions.

Location Scout Day: Even though the casting process required submission of scouting shots of each subject’s space, we wanted to get a professional out get some quality shots of each of the selected spaces to make sure we weren’t walking into any unusually difficult scenarios. I also wanted him to check out orientation, windows, and parking options.

Wardrobe Styling: We’d need a stylist to source wardrobe for each of the talent. Two options for each, one for the posed, one for the candid. I estimated two days to shop, three days for the shoot and one day to return. We budgeted 200.00 in non-returnable items for each wardrobe change.

Prop Styling: The prop stylist would need to purchase supplemental props to augment or update each space. We estimated two days for shopping, three days of shooting and one day of return for the stylist, one day of prep and three shoot days for the assistant, 500.00 in non-returnable props per location, and five days of prop-truck/van rental.

Groomer: Since we would only be shooting one talent at a time, we could get away with one wardrobe stylist and one make-up stylist who can also handle light wardrobe adjustments on set (a groomer). We included the groomer for all three shoot days

Airfare, Lodging and Car Rentals: Using Kayak, I priced out airfare & baggage costs, lodging and car rentals for the photographer, assistant & producer. I was sure to also include any taxes, fees, insurance and gas necessary.

Catering: I estimated three days of catering for 12 people at 50.00pp/day.

RV Days: Even though we were being provided indoor locations, I wanted to make sure our crew had the space to handle wardrobe, HMU and gear. RV’s also give the client/agency a space to hang out while shots are being set up and catering a place to stage.

Miles, Parking, FTP, Misc: I included costs for traveling meals, dinners, parking (at the hotel and airport), mileage, FTP for file upload and a little bit to cover any miscellaneous expenses that may arise.

Housekeeping: I made sure to indicate that the client/agency would be responsible for providing all advance scouting, casting, talent, locations and releases. Since these are all elements that might normally be included in a production estimate, I wanted to make certain it was clear that, as discussed, we would not be providing any of them and that the client or agency would be responsible for each.  Lastly, I noted that a 50% advance would be required.

At first, the art buyer told me that our numbers looked good, but then she called back a little later to say that they had another photographer who was willing to give them unrestricted use of all the pictures – for $10k less than we were bidding. She asked what we could do to match that. I have to admit, it’s a little annoying when a client asked us to meet another bidder’s licensing terms. After all, you can find any photographer to bid any price and terms. And it’s not reasonable to expect to have the pictures from one photographer at the price of another. I had a good enough relationship with the art buyer that I was able to call her out on this, asking that she ask the other photographer to raise his rates to meet ours. But, she wouldn’t do that. She also told us that the client wanted to license “outtakes” from the shoot to use on their website. And even though the client only wanted to use them on their website, they wanted the licensing to match that of the hero shots. Not being comfortable just licensing some unlimited number of images, we settled on an additional 32 images. Now, just because a client asks for something doesn’t mean you have to do it. I was pretty confident that my photographer was competing on quality rather than price, so while I didn’t feel that we need to match the other photographer’s terms we did decide to bend, coming down 3000.00 on the fee and including use of 40 images. Adding in the additional processing fees for the “outtakes” actually brought us back up above our original quote.

Here’s the final estimate:
Click to enlarge.Click to enlarge.

After a few days, the job was officially awarded to us and I immediately set to work on the production. The shoot went well and the agency, client and photographer were all thrilled with the results.

If you have any questions, or if you need help estimating or producing a project, please give us a call at (610) 260-0200. We’re available to help with any and all pricing and negotiating needs—from small stock sales to big ad campaigns.

There Are 25 Comments On This Article.

  1. As always…a thorough and well written estimate and explanation. I do wish there was an image or two to share, but understand there might be some restrictions.

  2. I was wandering if the 48,000 for the Photographer was mostly because of the usage? And where did that amount arrive from, was there a program you used? Tx

    • Hi Kristy,

      It’s explained here in the writeup:

      “Considering the use, size/prominence of the client & agency, number of images, various brand messages achieved, volume of work/shoot days, and the photographer’s experience, I set the fee at 8000.00 for each of the four portraits and 4000.00 for each of the candids. For the purposes of the estimate, I bundled it all together as an overall licensing/creative fee of 48000.00. Blinkbid’s bid consultant provided a range of 9450.00-13,500.00 per image, or 226,800.00-324,000.00 for all eight. Corbis quoted 17,500.00 per image for the first year and didn’t have a three year option for the quote pack I’d selected. Fotoquote suggested 30,976.00 per image for the use. None of these resources readily factor in any discount for additional images/variations or the prominence of the client, but they still offer great perspective.”

  3. I just want to say thanks Rob, and the guys from Wonderful Machine for this ongoing series. As an industry junior these case studies have been invaluable for me. If I was a course administrator at a photography college I would collate these and make them required reading!

    I share these articles with as many people as possible in the hope of promoting a more profitable local industry.

  4. Although on a much larger scale than the projects I am involved with it is great to be able to see how larger projects are planned, coordinated and priced. Thanks for posting.

  5. Tim Shisler

    One of my favorite things you do on the site Rob. Any chance you could include one or two that have multimedia components and price out behind-the-scenes video or a video/photo shoot that falls under the direction of one photographer? Thanks

  6. This licensing fee seems ridiculously low considering the scope of the usage. Considering Fotoquote’s suggested number x 4 main images, then a 50% discount (as you’re wont to provide) on the 4 subsequent images the number comes in at $186,000. Even if this number includes photographer’s fees and production charges, your quote seems to substantially undercut the competition. Don’t get me wrong, I’m all for volume discounts for great clients (on usage only), but, yikes.
    Usage alone from Corbis for 1 year (4 main images, by your numbers, and I’ve factored in a 50% discount for the 4 subsequent images) is $105,000. For STOCK photos, not the custom images the photographer was contracted to create using hand-selected talent. Again, for 1 year, not 3. By your quote, it seems to me the client is getting the photographer and production charges for free and the license fee at a third of the price, no?
    … or am I stoned.

  7. I may be numbers dyslexic, but my read on the licensing is the client got unlimited national print ad rights for unlimited size, unlimited insertions, plus all the other rights for $375.00 per image per year. Basically from an agent buyer perspective, it’s equal to a bulk Royalty Free sale from an agency, but with the term limiting factor balancing out the unlimited term and extra rights a true RF image would have.

    Also, perhaps an oversight, or my tired eyes just missed it, but since I never assume what’s not in writing; I don’t see the word “Exclusive” used in relation to the term or rights. Does this mean the photographer could sell the images outside this grant of rights, earning additional outside income from the shoot? If so, perhaps that’s a potential channel to make up for the low per image per year licensing fees for all those images, each and every one of which could now see use in all those glorious national print ads and in-store POP displays. (They may have only asked for extra uses to be on the web, but that’s not what the license says, if I read it correct.)

  8. Finally I am able to comment on one of these posts. Firstly thanks so much for posting these, its really a great resource and gives amazing insight and secondly, you guys over in the States have it easy. I see many people complaining about low rates but my eyes fall out of their sockets when I see the rates quoted and used. In my country of South Africa, most togs work for a day rate close to what you guys pay your first assistants. Very few would get close to a day rate of $1500/day for advertising! Editorial work for magazines you are looking at $350 per full day and if you dont have a contract you automatically loose copyright over your images.

    I would say, be very grateful for being able to get the rates you do get. Our day rate usually has to include everything and here is the kicker, our gear costs on average between 25% and 125% more than what you guys are paying for gear.

    Hopefully one day we will be able to get half decent rates for photographers until then, we suffer in silence.

    BTW, the income from this shoot would be equal to what most photographers in my country make in a whole year, shooting roughly 50 assignments.

  9. This time I have a question regarding usage. How relevant is usage by territory when things go online? ultimately it is visible by anyone world wide. How does one figure out online usage? It mentions online video use. Most companies I quote for want online usage but that is not something that ca be contained within a country, unless you live in China with a government implemented worldwide site ban.

    WOuld it be constricted to company website only, social media only, banner ads only, online videos etc?

  10. This is an amazing article, thank you for sharing it.

    Would you mind if I translated this post into Spanish and posted it on my blog? (with proper credit and link to the original of course). I’ve just finished a couple of articles on how to manage photography budgets and create a cost structure for photography and I find this would be the perfect example to show just how many things there are to take into consideration when making an estimate for a commercial job.

    I hope you let me so we can share this wonderful knowledge with more people in the industry all over the world.

  11. Hey, great article, thank you for sharing.

    As I am more into private shootings I have a question regarding the licence fee: How will get this truck-load of cash? You as the producer?

    Thank you, best wishes…