MicrostockGroup Sponsors


Author Topic: Sales slump  (Read 65427 times)

0 Members and 1 Guest are viewing this topic.

« Reply #150 on: August 12, 2010, 21:35 »
0
Backtracking a page or two here, but Gostywick said:

"Don't forget that the profitability of the subs model is entirely reliant on customers not downloading all of their entitlement..."

I have seen this stated many times and wondered why that is true? From a maths POV I dont understand the logic ... can someone explain it to me? thanks


« Reply #151 on: August 12, 2010, 22:04 »
0
The site has to pay a fixed amount per download.  If they paid contributors for all the downloads a buyer could take, they'd operate at a loss.  Or something like that.

« Reply #152 on: August 12, 2010, 22:20 »
0
The site has to pay a fixed amount per download.  If they paid contributors for all the downloads a buyer could take, they'd operate at a loss.  Or something like that.

I see them as breaking even with the maths but I suppose it depends too on the level of the contributor ... it's a fine balance these sites are striking ...

« Reply #153 on: August 13, 2010, 01:38 »
0
The site has to pay a fixed amount per download.  If they paid contributors for all the downloads a buyer could take, they'd operate at a loss.  Or something like that.

I see them as breaking even with the maths but I suppose it depends too on the level of the contributor ... it's a fine balance these sites are striking ...

When the calculation was first made, years ago, subscription prices were much lower and the payout per sale wasn't all that much different, so they would have made an outright loss. But even if they would now only pay out what they take in, they would still be working at a loss after paying for equipment, staff and advertising. Their profit margins must be similar to those of sites that pay between 50% and 20% in commission, to achieve that they need at least half the credits to go unused.

« Reply #154 on: August 13, 2010, 03:23 »
0
Their profit margins must be similar to those of sites that pay between 50% and 20% in commission, to achieve that they need at least half the credits to go unused.

They need their customers to use a lot less than half the allowed downloads.

Look at Fotolia as an example.
Their marketing says "Images from 14 cents". That's the theoretical cost of an image with their biggest subscription (full year, 250 pics a day, single user). For comparison: the "most expensive" of their standard subscriptions (one month, 25 pics / day, unlimited users) comes to a price per image at 40 cents.

But they do have a fixed payout per download of 30 to 37 cents (depending on the contributor's rank).

So to reach a profit margin similar to let's say paying 50% commission, they must expect that users only download around one quarter or less of the biggest subscriptions and around half of the smallest ones.
To reach a profit margin comparable to paying 20% commission it's obviously a lot less...

Microbius

« Reply #155 on: August 13, 2010, 05:28 »
0
The site has to pay a fixed amount per download.  If they paid contributors for all the downloads a buyer could take, they'd operate at a loss.  Or something like that.

I see them as breaking even with the maths but I suppose it depends too on the level of the contributor ... it's a fine balance these sites are striking ...

They have staff costs, over heads etc. to cover. So they would't be breaking even, they'd be running at a loss if their income only managed to cover payouts to contributors

« Reply #156 on: August 13, 2010, 05:52 »
0
The commissions SS pay us for PPD sales and EL's equate to roughly 34% of the total sale value (it varies somewhat depending on the package/discount). My guess is that they are paying out a similar % on subscriptions too which would that mean the average customer only downloads about 1/3 of their entitlement.

Getting back on topic I can't say that I have noticed any difference in sales at Istock before or after the site changes. Things were pretty crap before and they still are. In the unlikely event that the new site design sent the buyers elsewhere they would probably still have credit packages to use up and so there would be an inevitable lag before we saw the effect. Buyers choose where to shop for a number of reasons. The Istock buyer presumably values the variety and quality of work at IS, the search results, customer service, etc none of which has changed because of the site re-design.
« Last Edit: August 13, 2010, 06:12 by gostwyck »

« Reply #157 on: August 13, 2010, 09:13 »
0
I don't think the few people commenting here has any statistical relevance.
You are totally correct. That's why I kept out of this thread. But I enjoy reading the observations of the big guns here. It's one of the better threads. (XL and L sizes sales on iStock the past 2 days more than made up my 3 no-sales days after F5 - this might be the time of year: I had an unusual high number of level 5 credit sales the past 2 days on DT).
« Last Edit: August 13, 2010, 09:20 by FD-regular »

lagereek

« Reply #158 on: August 14, 2010, 01:22 »
0
Same here Ive been fine with the F5, no problem at all but I dont think thats the issue in this thread, somehow.

« Reply #159 on: August 15, 2010, 07:27 »
0
Yesterday i bumped into someone who works for a big production house that buys a lot of stock.
He said they have always used istock, but recently moved over to Shutterstock as istock got way too expensive. He was also complaining about so many images that cost easily $50/image. (Vetta).
Because we're so involved in stock we know what Vetta is about, but apparently not all buyers are aware and the fact that Vetta's are pushed to the front of the best match so agressively doesnt seem to be helping istock... that in combination with the other price raises makes maybe istock for big buyers isnt as interesting as it was anymore.
Of course this is only one company but i thought it was interesting to hear. (and was relieved they prefer shutterstock over TS ;))

« Reply #160 on: August 15, 2010, 08:08 »
0
Yesterday i bumped into someone who works for a big production house that buys a lot of stock.
He said they have always used istock, but recently moved over to Shutterstock as istock got way too expensive. He was also complaining about so many images that cost easily $50/image. (Vetta).
Because we're so involved in stock we know what Vetta is about, but apparently not all buyers are aware and the fact that Vetta's are pushed to the front of the best match so agressively doesnt seem to be helping istock...

That's my feeling.
I think Vetta is a good idea, however vetta images are increasingly filling up the front of the searches. Take a search for young women. Out of the first hundred pics about 76 are Vetta. Over 50 of those have sold less than two times and about 35 have never sold. Some of these have been on-line for nearly a year. The fact that so few people are attracted enough to buy these images even when placed at the front of the search suggests that istock is losing touch with its customer base.

 I don't think that trying to force buyers to look at and buy these expensive offerings, many of which are of no interest to them, is the way to attract new buyers. It may even be putting old buyers off. Of course non people searches don't have nearly so many Vetta files but people searches are some of the most popular.

« Reply #161 on: August 15, 2010, 09:05 »
0
I think Vetta is a good idea, however vetta images are increasingly filling up the front of the searches. Take a search for young women. Out of the first hundred pics about 76 are Vetta. Over 50 of those have sold less than two times and about 35 have never sold. Some of these have been on-line for nearly a year. The fact that so few people are attracted enough to buy these images even when placed at the front of the search suggests that istock is losing touch with its customer base.

 I don't think that trying to force buyers to look at and buy these expensive offerings, many of which are of no interest to them, is the way to attract new buyers. It may even be putting old buyers off. Of course non people searches don't have nearly so many Vetta files but people searches are some of the most popular.

Ouch __ that's bad considering that Vetta are supposedly limited to just 1% of the collection. Not giving buyers the ability to 'opt out' of Vetta on searches, which is frequently being demanded in the forums, is looking like a bad idea and a frustrating experience for customers.

« Reply #162 on: August 15, 2010, 09:14 »
0

Ouch __ that's bad considering that Vetta are supposedly limited to just 1% of the collection. Not giving buyers the ability to 'opt out' of Vetta on searches, which is frequently being demanded in the forums, is looking like a bad idea and a frustrating experience for customers.

Buyers can opt out Vetta files using the advanced search but it's not well publicised. Also a lot of buyers never use advanced search.

PaulieWalnuts

  • On the Wrong Side of the Business
« Reply #163 on: August 15, 2010, 10:03 »
0
Yeah I was thinking that new potential buyers, or buyers who don't keep up with istock changes, might see all of the high prices and just go elsewhere. So some current buyers probably have left and Vetta may be scaring off some new buyers who only see the high prices and just assume the entire site is higher priced.

Vetta and the normal collections should have been separated and clearly defined on the homepage. "Vetta Collection - Premium fresh creative images for 20-70 credits" and "Whatever Collection - huge selection of quality stock images for 1-40 credits".

I hate to use Photos.com as an example but they have "Photos.com" and "Photos.com Plus" that at least defines the different options.

lagereek

« Reply #164 on: August 15, 2010, 10:35 »
0
Vetta is a good thing and theres some great imagery there but to push it to the very front, bad idea!  and it gives the impression of touting as well.

PaulieWalnuts

  • On the Wrong Side of the Business
« Reply #165 on: August 15, 2010, 10:45 »
0
I agree it's a good thing. We need higher prices. Micro now gives buyers a lot of macro quality images at micro pricing.

Istock should have done a better job at defining the collections and showing the buyers the differences. I think it's okay to have Vetta up front in searches, but it there should be two separate clearly defined boxes for search results. the upper box should be Vetta with a "see more from this collection" at the bottom of the box and then the lower box should be the regular collection that also has a "see more from this collection". Or just some way of separating them. Vetta and regular tabs or whatever. Mixing search results together isn't the best way IMO.

lagereek

« Reply #166 on: August 16, 2010, 01:16 »
0
If buyers are complaining ( which they are)  that the Vetta is so expensive, etc,  why cant they just separate the Vetta from the main collection, giving buyers the option?
On other hand, its gone so far that buyers seem to expect pictures for nothing! I mean Vetta is more expensive then the main but its still nowhere near the price for a "proper" RF or RM shot,  so whats the beef, really? probably they dont want the Vetta images pushed up in their face when searching. Dont know.

« Reply #167 on: August 16, 2010, 04:08 »
0
microstock is dying  ;D

grp_photo

« Reply #168 on: August 16, 2010, 08:21 »
0
microstock is dying  ;D
Everything has to die (sooner or later).

« Reply #169 on: August 16, 2010, 08:53 »
0
Long live macro!  ;D

« Reply #170 on: August 17, 2010, 08:30 »
0
Long live macro!  ;D
Where did Macrosaur go? I always enjoyed his sarcastic comments till his cover was blown away.  ;)

lagereek

« Reply #171 on: August 17, 2010, 10:33 »
0
Yesterday i bumped into someone who works for a big production house that buys a lot of stock.
He said they have always used istock, but recently moved over to Shutterstock as istock got way too expensive. He was also complaining about so many images that cost easily $50/image. (Vetta).
Because we're so involved in stock we know what Vetta is about, but apparently not all buyers are aware and the fact that Vetta's are pushed to the front of the best match so agressively doesnt seem to be helping istock... that in combination with the other price raises makes maybe istock for big buyers isnt as interesting as it was anymore.
Of course this is only one company but i thought it was interesting to hear. (and was relieved they prefer shutterstock over TS ;))

See!  trouble is,  when you launch a so called "special collection" which is fine ofcourse, you got to make very, very sure it really is a special-collection and in every sense. Lots of "arty" , comical and far out shots are not enough, art, very seldom sell anyway. You could probably take Bruce Webbers or Newtons most famous shots here and they simply wouldnt sell.
All this was tried and tested by The-Image-Bank in late 80s. Bunch of world famous photographers put their images on sale and it was a total flopp from start to finish.

Vetta however is selling pretty well Ive heard but its still regarded as too expensive for what it is. Its like comparing a buyer going to the Getty-RM wading through the files just to find out the shot will set him back say 500 bucks when hundereds of very, very similar Micros will cost him a fraction of the price.

There is also a new trend moving all over the world, its about ordinary, ordinary, real people, ordinary jobs, ordinary things, etc, plasticky looking models seems to be tabu, its better to show an overweight madam eating a dripping hamburger, etc.
Latest Range-Rover campaign really sums it up, for the first time instead of this rich, luxuary couple stepping out of the the car,  out comes these two ordinary fellas, scruffily dressed in fishing gear, going fishing.

I think that if Micro is going to survive this dip, they really have to start concentrating on the real world.

donding

  • Think before you speak
« Reply #172 on: August 17, 2010, 11:24 »
0

There is also a new trend moving all over the world, its about ordinary, ordinary, real people, ordinary jobs, ordinary things, etc, plasticky looking models seems to be tabu, its better to show an overweight madam eating a dripping hamburger, etc.
Latest Range-Rover campaign really sums it up, for the first time instead of this rich, luxuary couple stepping out of the the car,  out comes these two ordinary fellas, scruffily dressed in fishing gear, going fishing.

I think that if Micro is going to survive this dip, they really have to start concentrating on the real world.

I agree 100% lagereek. There are still the "model" studio shots needed out there, but a lot of the buyers are starting to want the candid "real people" shots. You've heard it a lot lately. I've heard it from several buyers and they are going elsewhere to get those real shots because there is a lack of it on stock sites. These stock sites need to really start listening to the buyers.

lisafx

« Reply #173 on: August 17, 2010, 12:30 »
0
There are plenty of "real" looking ordinary people in microstock. 

Problem is they are nearly impossible to find, drowned as they are in a sea of Yuri's and Monkeybusiness's  perfect looking, cookie cutter images. 

If the micro sites don't find a way in their search engines to allow the real people type images to see the light of day, they will continue to lose buyers to Flikr and the like.   And adding the keyphrase "real people" isn't helpful because buyers don't know to search for it. 

abimages

« Reply #174 on: August 17, 2010, 12:38 »
0
There are plenty of "real" looking ordinary people in microstock. 

Problem is they are nearly impossible to find, drowned as they are in a sea of Yuri's and Monkeybusiness's  perfect looking, cookie cutter images. 

If the micro sites don't find a way in their search engines to allow the real people type images to see the light of day, they will continue to lose buyers to Flikr and the like.   And adding the keyphrase "real people" isn't helpful because buyers don't know to search for it. 

Very true! We have heard buyers moaning about this for years, I tried it once or twice and it wasn't terribly successful. Buyers still seem to buy shiny happy models ???


 

Related Topics

  Subject / Started by Replies Last post
20 Replies
5672 Views
Last post June 07, 2007, 16:44
by hatman12
13 Replies
3570 Views
Last post July 19, 2011, 11:10
by ToniFlap
8 Replies
2242 Views
Last post July 04, 2012, 16:58
by wut
17 Replies
2088 Views
Last post February 04, 2014, 17:40
by Rinderart
5 Replies
1673 Views
Last post March 04, 2014, 12:01
by gbalex

Sponsors

Microstock Poll Results