IPA - The Stockman Cometh


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The Stockman Cometh

by Brad Holland

July 1, 1999

Many artists think of stock houses as agencies, and many stock houses encourage them to. It’s a prudent strategy for the stock house because they depend on the goodwill of illustrators to give them free work. But as artists, it’s time we realize that these stock houses are our competitors. And it’s time we stopped giving them the work they need to undersell us.

There’s nothing wrong with selling stock. Artists have been doing it for twenty years. But stock houses are something new on the scene. They represent the movement into illustration of businessmen who are amassing large inventories of art to sell to clients at discounted prices. Although they promote themselves to artists as an easy outlet for making a “little extra money”, they promote their inventory to clients as a cheap alternative to dealing directly with artists.

Some stock houses are more benign than others. But even the best take more from us than they give. One prominent company, a self-advertised leader in the field, is a perfect example. When you sign a contract with them, you lose all rights to your work for five years. During that time they can sell your pictures to whomever they want, for whatever price they can get. They take half of the profits on domestic sales, 75% overseas. You must track the expiration date of each contract. At the end of five years, you have a 60 day window to retrieve your rights. You must do this in writing, and you must do it for each picture. If you fail, an automatic rollover clause locks in your work for another five years.

With terms like this, you might expect to be paid at least an advance against royalties. But, in stock, YOU pay the stock house. You pay a “production fee” of $125 for each image. And if they give you advice, you may pay a “consultation fee” as well.

Many stock houses now retail tens of thousands of pictures to clients. One company, with an inventory of over 14,000 pictures, boasts that their ‘critical mass’ makes them a magnet for clients. This may be true, but any stock merchant who amasses this kind of inventory does so knowing that volume will insulate the stock house from dependency on individual artists.

Since they pay nothing for the work they catalogue, the sale of one person’s work is as good as another to them. You may or may not profit from your investment in stock. Indeed, after fees, you could even loose money. But with volume sales and sky-high commissions, the stock house will thrive. To them, that’s the meaning of “critical mass”.

Stock houses imply that many artists enjoy huge incomes through multiple stock sales. Perhaps some do. But since I began speaking about this subject a year ago, I’ve been contacted by many stock artists who paint a very different picture. I’ve heard of fees for $55, $25 and $12.50. Naturally, stock entrepreneurs are not eager for news of these cheesy prices to leak out. They admit them, but characterize them as low-end sales. Still, that only begs the big question: How can anyone with a stake in the future of our business justify selling pictures for two-bit prices? And the answer is, they can’t.

In a recent newsletter one stock house boasted that it took "less than sixty sales to generate $18,000 in income." No doubt they hoped to impress artists with a five-figure sum. But it’s the sales count we should notice. Do your math. Here’s a leading stock house telling us that their average sale is $300.

Stock means, “Honey, I shrunk the fees.” It means “less is more if you happen to own a stock house.” Because if 60 average stock sales represent 60 lost commissions, and if each of those had been worth even $1,000, then at least $60,000 of potential income has been condensed to $18,000. Of which, a few businessmen will take half. We can only imagine how much money that once went to artists to make a living is being boiled down like this to profit these entrepreneurs. But since the residue of this condensation is being passed along to artists as “a little extra money”, we’re supposed to welcome it.

Stock promoters give you many reasons why it’s good to give them your art. But look closely and you’ll see that those reasons are good for them, not for you.

1. Stock houses claim that they’re expanding the market for illustration. I’m sure they make some virgin sales. But otherwise, what would we expect them to say? How dumb would they have to be to hustle us by saying, ‘Give us your work, so we can steal your clients?’

2. They claim that stock sales generate new commissions. There’s probably some truth here too. But the number of commissions generated by stock can’t possibly make up for the huge number lost to stock in the first place.

3. They claim that stock serves clients who need rush art on short deadlines. Yes, but in every business I can think of, rush service means premium pricing. If I want an overnight courier or rush transparencies, I have to pay extra. Only in stock illustration do they say, "If you need it in a hurry, you can have it cheap".

4. They claim that stock serves clients on low budgets. Yes, but Wal-Mart prices create a buyer’s market. They enable art directors to play "How low can you go" with assignment fees. They tempt designers to buy stock cheap and profit from marking it up. In the past, we could use short deadlines to bargain for more money; tight budgets to get more creative freedom. Ready-made pictures at cheap prices undermine that leverage.

5. To downplay the bad news about low prices, stock houses hype multiple sales. But if it’s bad business to undersell a picture once, how does selling it twenty times for the same low price make it better? Every time a client leaves a stock house with cheap art, he’s more likely to come back to them, not you, for more.

Stock houses welcome entry-level artists, and many young artists see stock houses as a door into the illustration business. But, in fact, as stock houses gobble up low-budget jobs, the young artist who could once count on a couple of $400 assignments each month may now have to settle for splitting some $50 stock fees. I’ve been in this business a quarter-century and nothing that I’ve seen disgusts me as much as watching these stock merchants hustle free work and “production fees” from the very some young artists whose freelance assignments are most vulnerable to their lowball prices.

Stock merchants claim the ‘feedback’ they give these artists helps them create “great stock imagery”. But if this means that artists are creating “stock imagery” on spec, as I know some are, then the practice threatens the professional nature of illustration itself. It threatens the professional nature of illustration itself. It threatens to turn our business into a kind of lottery where artists gamble their time and money on a shot at multiple sales with no guarantees of return, and businessman can acquire art risk-free to sell as they please.

I believe there’s a great deal of money yet to be made in illustration. The proof is that these entrepreneurs, who have no motive other than profit, want in to our business and they want as much of our work as they can get. But their business practices threaten our ability to compete on terms that most of us want to become artists in the first place.

Unlike stock retailers, we’re craftsmen. Many of us take pride in the work we do. I know very few artists who define excellence as a multiple sales at discounted prices. Compared with judged competitions, much of the work in stock catalogues is mediocre and derivative. Some is plagiarized. Stock houses glut the market with clichÈs. They explicitly advise artists not to think that their best work will be their biggest sellers. This observation will hardly come as news to any artists who has ever sent five sketches to a client and watched him pick the least challenging. But it should remind us why the interplay of artist and client can often lead to innovative work.

We should not let these marketing people lower the bar for us. We should be careful that their standards do not become the standard that clients demand from the rest of us and to which younger artists aspire.

What can we do to stop losing valuable commissions to these retailers?

1. Stop giving them pictures. Would Sony give stereos to Mitsubishi? Of course not. Only artists think it’s a smart move to give inventory to the competition.

2. If you think you need to be in stock, pick a direct stock service. They’ll charge you to put your work in their catalogue, but they won’t own your work, and you can get out whenever you want. You’ll be in charge, you can set your own prices, negotiate your own terms and keep you own profits.

3. Don’t lowball your own stock prices. We must persuade art directors and clients that if “stock is here to stay”, then it’s a service they can use for a price. “You can get it fast, but you can’t get it cheap” should be the new motto for stock artists.

4. Don’t glut the market. Remember that in general you’re better off selling a picture once for $2,000, than 20 times for $100. You make the same amount of money and you don’t overexpose your work.

Artists and reps should stop seeing stock as an easy way to make “a little extra money”. We are not hobbyists. Every time one artist makes a “little extra money” in stock, another artist somewhere loses a commission. Sooner or later we are all that other artist. The more we trade the higher fees of commissioned work for the chump change of stock, the more we speed the day when professional illustration is degraded to a part-time activity.

Originally published in Communication Arts Magazine September 1998