No. Hell no.

Rob has an important post on APE about GM’s agency refusing advances and requiring photogs to be last in the payment foodchain.  If you get a contract like this, you must say “no.” You do not need to finance both the agency and GM. That’s what it means. And that is IF they pay.

The risk is far too high to take. If there is another reorganization of any kind, you will be the very last entity to get paid, if at all. More importantly, other agencies will claim that “in these tough times…” they require the same kinds of terms. We need to make a hard stand now against this. Get the word out, especially to some of your less educated and more desperate colleagues.

[yes, this has been cross-posted on several forums… we need to get the word out and make a stand about this]

Dating, No.1

Marketing is like dating.

This is the first of a series of posts which will eventually evolve into a presentation, and maybe a book, about how the skills for one are transferrable to the other. And if you suck at both, there will be hints on how to change that.

Why is marketing like dating? Lots of reasons. Here’s today’s:

If you smell bad, you aren’t going to get to first base.

Trying to pick up someone? Smelling good is very important. Truth is, in both the social and the creative biz world, scent matters more than we’d like to admit or may even consciously know. Smell hits our limbic system, one of the most primitive parts of the human brain, and it connects very strongly with our romantic emotions. Pheromones are received through the sense of smell and, well, tell our brain “zug-zug.” 🙂

Women have a stronger sense of smell than men–were coded that way since we have to pick who to be our baby daddy (that means finding a good genetic match). But men aren’t without working sniffometers. I’ve had plenty of male friends who have said about their potential objects of affection, “S/he just smelled funky” or “S/he always smells so good!”

Ever been at a party or a club and someone walks by and you just breathe her/him in? Your head turns to see what could have smelled so good! Pretty much an involuntary reaction, because your pre-historic brain bits are always tuned to “zug-zug potential” mode.

So, our brains are much more smell-oriented than you might have known. And while smelling good may be a relative thing (what you like better may not be what your neighbor likes better), smelling bad is pretty much a universal negative.

Okay, that sounds really obvious, but you’d be surprised. I can’t tell you how many times I’ve been at photo biz events and more than one photographer was pungent, and not in a good way. I’ve talked with buyers who have related horror stories of stinky portfolio meetings. Personally, I’ve noticed those who have just smelled a bit “post-gym-ish” to those who could give a homeless alcoholic a run for his money (urine… I’m not kidding).

I know for some people, there are medical issues, but even then you have got to find a way to deal with that. If it’s some kind of uber-BO then there are medical treatments for that (and excessive sweating, too). For most people, there are answers and you need to find something that works for you. Fair or not, no one is going to give a project to a photographer who smells bad, whatever the reason. Imagine sending a stinky shooter to a CEO’s office for a portrait!

Good marketers have known the importance of smell for a long time. Why does that open house smell of cookies? To manipulate your brain. Lots of examples of that.

Most Art Buyers/Art Producers are women which means your targets are tuned to smell at a high level. PEs & ADs are more evenly split, but still lots of males… mostly males who are more aware of style and grooming than the average male. Regardless of gender issues, clearly it makes good sense (no bad pun intended) to appeal to your target’s nose!

While in the dating world there is a big exception to the “stinky means no chance” reality (if you meet someone at the gym, you get a one-time pass because you are supposed to be sweaty there), there is no such exception in the business world. If you are going to a biz event (even like an all-photographer thing), bathe, use deodorant, consider a little light cologne– you never know when I target might be there too. If you are going to a client meeting, make an extra effort. And even on your shoots, which means metaphorically that you’ve gotten past first base, if stinky is a problem for you, bring extra shirts and wet-naps and take 5 minutes to duck in a bathroom to freshen-up.

After all, don’t you want to “date” this client again and try to make it a relationship?

The Rules

You may not think that a rant against a stupid viral that purported to be about a Danish woman who was looking for the father of her child but was, really, a Danish government paid-for ploy to get tourists to visit would have anything to do with your business. But you’d be wrong. This post is about the rules that all marketers need to remember.

You are a marketer.

These apply to you too.

Rational pricing

A Photo Editor has been posting estimates lately. He has been doing this to try and help the industry–Rob is a good guy and means well. However, the estimates he has been posting are sort of working against their intention. I think he intended to show what real world pricing is like out there but, when you look at the estimates objectively, you can see how pricing is a total fiction. Some examples from the various estimates:

  • 32 images for unlimited media for unlimited time in the US for $25K? That is $782.25/per image. Forever and in all media… including creative fee (because the photog used a combined fee)… Way too low.
  • When you break down the number to per-image prices, you get one image for one-time use for $2500 in one estimate and one image for unlimited global use for $2500 in another. How is that possible?

We need to fix this. We need a system for pricing usage, particularly in the advertising & client-direct realms.

These days cost consultants reign supreme. They are numbers people. If we can find a system that is wholly logical, that works in the minds of the numbers people, we can still get appropriate fees. You can’t argue with facts, only the interpretation of facts. And math, well, that is the least arguable interpretation tool out there. So that is why devising some mathematical system will benefit everyone.

I have argued for tying the Usage Licensing Fee to the media costs–a percentage system and maybe even a sliding scale to take into account economies of size. The only significant downside to this is that agencies sometimes do not have these costs. Okay, that is a problem. Let’s find a solution.

Those costs are ballpark-able by anyone and that will get you closer than just guessing. For example, if the agency says the client is going to do OOH and print ads in one state, but they don’t know how much the client is spending on media, ask them if they know how much the client spent last year or what media the *do* know about.

Perfect? No. But better than wildly guessing. Better than underpricing which is what is happening far too often. Most of the estimates posted by APE are way too low.

And the License Fee needs to be separate. Other license-based industries do this–like software and music. Why? Again because it is logical and fair. A license for one year print in the US is worth $X no matter WHO the photographer is. And the next year that license will still be worth $X (plus inflation, maybe)–not some percentage of $X.

This whole thing about taking a percentage of fees for reuse came about BECAUSE the fees were combined. The clients did not want to pay for the act of creation again, so the percentage worked to take that out. Then it morphed into a way to get more for less. These aren’t stupid people, these agencies/clients! By separating fees we re-take control of our pricing and instead of defending our pricing can turn to the client and get them to explain why a license that is identical to a previous one should cost less (They can’t, not logically). One they “get” the logic, they can see it isn’t you against them, it is just math and logic. No good guys/bad guys. It just works.

Logic and rationalism and math can put us, creatives and clients, on the same page. It becomes an objective system that helps everyone achieve their goals.

Another lesson from law school

Over the weekend I was doing my reading for my Licensing class when I noticed an interesting linguistic flip. It got me to thinking about how we look at licenses and I thought this alternative might be helpful. In the casebook (textbook) the authors refer to a license not (only) as permission for someone to use some intellectual property, but rather as an agreement by which the IP owner agrees not to sue the user (licensee).

Hmm… an agreement not to sue. I like that. It puts the perceived power back in the hands of the IP owner.

The casebook also points out that in “regular” contracts (not licenses, which are also contacts, but let’s not get confused), if there is ambiguity in the language the courts will construe the contract against the drafter. That means if you present a contract to someone else, like to buy their house, and the contract ends up being litigated for some reason, the courts will be more harsh on you, not the other side, because it was your contract. You had the burden, essentially, to get the wording right and clear and if it wasn’t, well, that’s your bad and you have to suffer the consequences. Using the house example, if you don’t expressly note that the porch swing is NOT a part of the deal, it will be included as part of the house.

However, and this is important, a license is construed by the courts narrowly, that is, in favor of the licensor (the IP owner). If a license does not include something, the courts will assume that the something is NOT included–the porch swing would not be part of the house sale, so to speak (don’t get picky here, the house sale is not a license, but I’m trying to simplify some things  for understanding).

These two things can give you more power in your business. When you know that you are licensing ONLY the uses you specifically name in your license and that your license is your promise not to sue (unless the other side screws up), you hold the power in that relationship! While I am all about seeing both sides as equals, too many photographers see themselves in weak positions. Hopefully this will help balance things in your heads.

[as always, this is not a legal opinion or legal advice–just the musings from my own head–consult a lawyer for your legal needs!]

Is it editorial when the mag calls?

Used to be, a magazine would call and a photographer would know that the usage was editorial. Now, you need to ask. More magazines are now creating the ads that run on their pages. This article from the NYTimes explains.

They are customized ads that work with the editorial content in placement and ad content. This means they are done quickly. It also means they may try to call them something like “advertorial” when they negotiate with you. Don’t get confused–these are ads and they are worth just as much, if not more, than regular ads. I say “more” because the combination of specific placement and targeting, they are potentially much more effective than just any ad.

Some important things to note from this…

  • Digital photography makes the ad customization “cheaper and faster to shoot” in their minds. Faster? yes, probably, but why cheaper? This is their mindset and we need to push back on that idea.
  • The ads are being used not only in print, but also are being licensed for use on tv, online, and even packaging. This means photographers need to nail the usage down when negotiating a project!
  • The mags say that the ads are more expensive for the advertisers (see end of article) but at the same time they talk about cheaper photography. Hmmm…
  • In Condé Nast’s case, they obviously value artists in different fields. How can we get them to recognize similar value in advertising photography?
  • Keep in mind when they call that the placement alone (w/o creative!) in these magazines is usually over $100K for one single-page ad; and they are apparently shooting multiple ads (variations) for each project. Add in additional uses as mentioned above, and the value of any project like this is high.

New uses like this are being devised every day. That rapid change is another reason we need to find a more logical usage pricing system (creative fees will always vary depending on photographer and complexity–I’m ONLY talking about usage license prices). It is difficult to quantify value, but if we can systematize usage license pricing, it will make everyone’s lives easier and help hold up the prices as they will be tied to an objective value.

Relative Value

I posted this link on the BAP Facebook page yesterday, but I wanted to go into a bit more detail about it. What the link takes you to is a pdf of the Clearchannel outdoor media rate card–a listing of the prices advertisers pay to rent billboards and the like.

The first think I’d like to point out is that there are a lot more media options than you may have ever thought about. For example, we all know about bus shelters and bus wraps, but we tend to forget about inside of the bus or commuter trains, on top of taxis, or all the ads we see at malls.

Even though there are a lot of things listed on this pdf, these are actually just a few media options. There is media (space rented by advertisers, I mean) everywhere– the conveyor belts and carts at the grocery store, flyers filling your mailbox, and everything digital, of course.

And it all costs to rent. Those prices are pretty much standardized within their relative markets and usually you can get those prices on online media cards like this. By looking at these media cards, you can start to understand the relative value of your work and estimate your fees more accurately.

There are still people who say that basing your usage fees of media rates is an old, discarded way of doing the math. Apparently it was done 20+ years ago, before I got into the biz, and rejected. I have no idea why or what things were like then. But just because it didn’t work then doesn’t mean it’s a bad idea now.

Now it makes sense. As noted in Getting to Yes (Ury, et al), one of the pillars to successful negotiations is using objective criteria–using the media rates (something out of the control of both you and the agency/client you are negotiating with) makes your position rational. If placement costs $800,000 then the usage fee should be greater than placement which costs $300,000. Pencil-pushers can understand this. As I discuss in this month’s Creative Lube, cost consultants are looking at everything to try and get the numbers down–you need to have a rational argument for why you are billing what you bill. Taking yourself out of the equation and, instead, pointing out the simple logic of a more extensive media buy equalling a greater usage fee simply works in these numbers-guys’ heads. They can’t argue with math.

These media numbers are important to know, also, because when you are selling an unlimited license of some sort, you need to know what you are really selling–it’s a hell of a lot more than you may think. Don’t give it away. When you understand the value of your work in the media environment, when you learn what sorts of numbers your clients are used to dealing with, suddenly that $48K for creative AND usage fees for two years GLOBAL unlimited print media doesn’t sound like such a good number after all (see first estimate posted by APE). Yes, $48K is a lot of money to a lot of you, but it isn’t a lot of money in the world of your clients–that is, their perspectives are different. They are used to much higher numbers!

You must learn to separate your personal perspective (“$48K is more than I’ve made this year! I’d be thrilled to get this!”) from the actual, objective value being exchanged in this transaction. The objective value for that broad usage (global unlimited print!) is a hell of a lot more than $48K (and remember, that number quoted by that photog INCLUDES the creative fee as well as usage, so the usage is actually less than $48K!).

Think about it… how many taxi tops, bush shelters, and grocery carts are there in the whole world…

Back again and thinking of next summer

Thanks to everyone for their patience while I slogged through 5, count ’em 5 law school exams. That was insane, but I got through it (hopefully successfully) and am back at it.

And already I’m thinking about the future. Specifically, next summer. I will be hitting the road then to speak at various creative groups. If you are interested in having me come to your city, please contact your local APA, ASMP (AIGA, etc.) group and tell them to invite me to speak. While I’ll be contacting the groups as well, it’s always helpful to have it come from the members. This is your chance to have me in the room, to ask questions, and to learn as much as possible from me. I also try to have at least one day available for one-on-one meetings in each city. I hope to travel mostly in May and the first half of June of 2010… kind of like a concert tour.

Stay tuned for more updates as things start to firm up.

In the meantime, if you want quickie updates and links to articles of interest, etc., I encourage you to become of Facebook BAP fan. I post many more quick thoughts and ideas there.

Creative Lube reminder

Don’t forget to subscribe to the new Creative Lube podcasts. If you were getting Creative Lube via iTunes or through some other feed, you won’t get any new ones without signing up!

Upcoming episodes will include topics like social media, websites, alternative promo ideas, what buyers respond to, and how to edit your work for your book. An annual subscription will mean you get at least two episodes free (as compared to buying individually). Get it here: http://burnsautoparts.podbean.com/