Karimala accidentally deleted the very lively thread here about the importance of business planning in microstock while trying to move it to a more prominent location. This is a rather important topic so I will begin it here with my last post edited to be a first post.

First of all, "business plan" isn't a buzz word you pull out of your tail at meetings to impress your boss or to apply to your misguided ignorance to make it sound legitimate. It is a very important document. The very first step in starting any business is to write a business plan. Missing that step is the reason for almost all new business failures, and failure to keep your business plan up to date is a major cause of existing business failures. If you go into a bank for a business loan the first thing they will ask for is your business plan. No plan? You can forget it right there because you are a horrible risk.

A plan doesn't guarantee success, but lack of a plan virtually guarantees failure. It is that simple. The reason is that a business plan works out on paper whether this business can succeed and how you plan to go about it. The first step in the plan should be a market analysis. What is happening in the market? Is it stable or in flux? Is it saturated? What is your target market? What are the projected earnings potential over one year, five years, and ten years?

ok...for anyone who is actually willing to listen and learn I'm going to explain what is going on in this market right now. First of all, you can't base anything on what has worked in the past. The reason is that, until this year, the trads (traditional stock agencies) and the early microstockers, were working in a bubble market of old money. A recent article in Wired magazine about "crowd sourcing" quoted a long time photographer saying he was making $69,000.00 per year side money on a portfolio of 100 stock images. Think about that for a few minutes. That is almost $700.00 per image per year average. And this was spare time income on the side using surplus images from contract shoots. A full time port of 1000 images would have made $700,000.00 per year. And there were indeed many photographers making that kind of money and more.

But it was, much like the music industry, an insiders market. Artistic skill meant zip. What mattered was business acumen. You had to work your way into the industry with pure business smarts. Read up on Madona. One thing even her detractors agree on is that she is one hell of a business lady. I have seen musicians with 1000 times the talent starving on the streets. This is ALWAYS the way in a stable market. Business sense is all that matters. As I said before, Bill Gates never made a penny off of his technical skills. He made all his money with business skills.

Insiders in such markets often become complacent as bubbles expand, expecting it to go on forever. And even when the bubbles begin to burst, the old timers always fight to keep patching the bubble and keep their hold on the market. That is what we are seeing in the trads today, both in photography and in music for that matter. And even worse, the newcomers often think this sudden gravy train is here to stay. They think they have stumbled on a never ending flow of money. It is more like the wind from a collapsing high pressure zone. Once everything is stabilized the wind stops.

Many things can contribute to dramatic market changes, but usually it is new technology. A close study of the beginnings of the iron age and bronze age will show how this works. New technologies cause dramatic economic shifts and people can make sudden fortunes, but only until the market stabilizes again. We just saw this happen to the photography industry, albeit not on the same scale as the bronze age. The Internet made it possible for any Joe Blow with a camera to offer pictures for sale in the global market and the old money bubble made the market ripe for that. As a side note, I will never forget the interview I saw once of an oil industry wife after the oil boom was over. She said, "I just don't know how we are going to manage on only $250,000.00 per year!" and that was back when that was really serious money. I imagine it got a lot worse for her before it was over.

Within one year, that photographer interviewed for Wired had dropped to only $59,000.00 per year on a portfolio of 1000 images. Ten times the images producing $10,000.00 less per year. That is down from $700 per image per year to $60 per image. That is what happens when such bubbles finally collapse. At the same time, the new microstockers were reveling in the possibility of making $40,0000 per year or more on portfolios of 1000 images. The gold rush was on. All you needed was a bucket in the form of a camera to make a bundle. No business experience required. Heck, not even much talent or skill required. This is where most of the big names right now in microstock became the big names. Nothing to see here. The only thing they did was show up at the right place at the right time. Emulating them won't do you any good now...the market is equalizing. There is no more gold rush. It's over...done...finished. And anyone with any sense already knows this. Time to update the business plan. (actually long past time because your plan should have predicted this long ago as mine did).

But in fact a common fatal error at such times is the belief that "I made it because I did it this way" instead of realizing you made it because any moron could have made it if they happened to be standing in the right place at the right time. It is like winning a lotto and believing you did it by skill. There are a couple microstock agencies right now making this mistake. They think that what worked then will work forever, not realizing it worked in spite of their actions, not because of them.

Mostly what we are seeing now is a bunch of people running around saying, "hey...I found a dribble over here!" just like in the waning days of the old west gold rush, with a few hearty souls still looking for that mythical "Mother Load" while everyone with brains has gone back to the standard business practices that work in a stable industry. In fact we are in for some really dry times until the influx stops and the gold rushers start drifting off in search of easier pickings. Read up a bit on the aftermath of the American gold rush. That was a pretty sad time for many late comers who hadn't planned past their first gold strike that never came.

This is a very broad "state of the market" foundation for a business plan. But it really does constitute a foundation. Something to build on to determine your best course of action. It shows you where the market is going and what you are going to have to do to stay in it. It isn't the time for "every man for himself, grab what you can". In fact that time ended just about a year ago. It is now a time for establishing trusting, mutually beneficial partnerships with key players and making sure you do what ever you can to ensure the success of those partners over the long range because your success will depend on theirs as well as theirs on yours. It's time to work on branding and establishing client relations beyond the agencies as well as through them. It's time for the agencies to think more of acting as agents instead of mass wholesalers. But most of all, it is a time to recognize there are sharks in the water and food is getting scarce.

Yeh...I'm a dork! ops: LOL Sorry for the inconvenience everyone!

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Part two

When I was a kid I always said I never study history because there is no future in it. I never realized how wrong that statement was until I got MUCH older and gained an avid love for the study of history. It isn't the times so much that interest me, but the fact that humanity, over the millennia, has tried every possible combination of socio/economic/politicism and the results are right there for everyone to see and learn from. If there is a philosophy, it has been thought of and tried under every possible condition and a good student can see exactly what it will do. There are far too few good students in this world today.

Most people don't realize that this is what gave the United states the solid foundation to stand on that has kept it stable for so long. John Adams was also an avid student of sociopolitical history. He studied every historic implementation of government and why they succeeded and failed, then he fought to base America's new government upon what he had learned. Franklin was the same, gathering even from some of my own ancestors, the Iroquois tribes, whose unification agreements actually contributed substantially to the US constitution. There is indeed a future in history...my future...and yours too.

I mentioned the bronze and iron ages in my previous post and how they related to what we see today in stock photography. To produce Bronze you need certain ingredients and resources. Places positioned central to those resources gained a huge economic boost from production and trade in bronze products and the resources required to produce them. They became centers of power and commerce. Not through any action of their own (though they likely believed it was), but simply by pure chance.

However, when iron came along, it required a different set of materials, shifting economic power to completely different areas that were more central to those resources. Many historians believe (and I concur, mythology aside) that the battle of troy was a last ditch effort by old money bronze age industrialists to gain control over the new iron age center of commerce. I'm sure that theory could be nitpicked but my point here is that there is nothing new under the sun. This is the exact same battle we are seeing today between the Trads and the microstockers and you can find this same battle over and over throughout human history. There is no need to guess what will happen next because it has already happened thousands of times and all you have to do is look them up.

There are certain topics that people automatically feel are a matter of almost religious faith because the actual facts are beyond the knowledge of the average person. One of these is economics. Always keep in mind that, just because you personally don't know something for fact, doesn't mean no one knows it. The big disasters in this field are not due to people following time proven rules but from people ignoring them, thinking they are nonsense, thinking that economics or politics are a matter of personal opinion and nothing more.

But those who recognize the validity of true scholarship always lead the way to stability. As France repeatedly tried and failed to set up a new stable government, John Adams was standing on the sidelines telling them exactly what they were doing wrong and why it wouldn't work. Every time he was dead on right and they still continued to ignore him. I certainly know that feeling. But I thank him posthumously for leading the battle to force my country to get it right. It is too bad we have forgotten his lessons. But I digress (which happens to be one of my favorite pastimes).

The battle lines have been drawn between the barons of yesterdays industrial age film photography and the new rising stars of today's digital market. My advice to those of the new microstock age...hell hath no fury like an industry leader scorned. Man has not evolved all that much since the days of Troy. They might not come after you with bronze battle axes but you do need to be very careful who you decide to deal with now, what their real motives are, and whether those motives fit with your best interests.

hahahaha...you don't know how many times I've done something like that on this board :lol:

Join the Dork Patrol :lol:

Don't sweat it...

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yeah... and it gave me a whole fresh new thread to spout off in

Happy New Year All...my wife is dragging me off to some stupid party now... :wink:

Woah, all of that text is making me dizzy - I don't think I can read that much. I'll try tomorrow :lol:

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s e l l p h o t o s . t k

Top Sellers ? Shutterstock ? Fotolia ? Dreamstime ? BigStock ? StockXpert ? FeaturePics ? MostPhotos ?

Increase the font size until there is an average of only about 12 to 13 words per line. That is as much as the human brain can effectively track without losing focus. That is why newspaper columns are so narrow...something many many web designers have yet to learn. I learned it way back in the days of Wang.

so what is the conclusion "Wise One"? What should we be doing so that we are constantly staying ahead?
-> Creativity?
-> Innovation?
-> Survival of the fittest?
-> Forget stock?
-> Take photos that no one will take and hope that it will be what will be bought?

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I'll answer this in the morning, Peiling. It has been a too long day P Happy New Year!

Creativity and innovation can cover a lot of territory. If you are talking about product quality, well...I would love to be able to say that, if you produce high quality products, the world will beat a path to your door singing your praises and bringing gifts of treasure. But we all know that just isn't the way it works. That would be like expecting the smartest people with the best ideas to win all the elections. No good Candidate would need $millions to get into office. Heck, if the most qualified person always got into the office I would be president of the United States (I will leave it as an exercise for the reader to determine whether I am jesting or not).

That would mean that only the most talented musicians and actors would become stars. Ever heard of Duane Eddy? The most successful rock and roll instrumentalist of all time, with over 100 million records sold...He certainly didn't get there on the quality of his guitar work. And virtually every industry is dominated by people and companies like that. I don't think anyone could argue that Walmart is so successful because it produces the best quality or originality. It is nice if you have a quality product, but that isn't going to win the game or even allow you to stay in the game, nor is it even necessary.

And on top of that, how many of you sincerely believe you are going to produce consistent quality that is good enough to stand out in this market? I mean seriously. One or two pictures won't do it. If you want to win with just the quality of your work you are going to need at least 1000 images that are as good or better than anything else on the market. Do you honestly believe you can do that? The best you can hope for is to stay in the competition and not many will do that on just quality.

And as far as niches, all the best niches and even most not so good niches are already filled to overflowing. I suppose I could become the number one source for poison wild plants of the Puget Sound region. I'm sure there would be a huge market for that in microstock. That would be better sold as trad stock but I am willing to bet someone would pile a bunch of competing pictures that are every bit as good onto a micro site at a couple bucks each.

You could, of course, give up and go do something else. Quite frankly, I encourage a lot of people to do just that...especially if you really don't want to be a business person. Go find something you enjoy doing. Take your pictures for fun and leave it at that. Get up and go to work every day and let the true entrepreneurs worry about all this nonsense. There is nothing at all dishonorable in that. You won't have to worry about business plans or marketing or branding or diversifying, or what trade associations you should join or which business alliances to make or bookkeeping or taxes or depreciation or even purple fringing.

So now that we have pretty much covered all the negatives let's look at what we can do. If you are going to survive in business there are three ways to do it (aside from investing in good stocks and letting someone else handle the icky work). The best way is just to become a professional business person, hire a professional staff to do all the work and spend all your time managing and delegating. The number one requirement is a massive promotional campaign to get enough business to pay all those paychecks and still take a healthy cut off the top.

In that case you can put your camera away because you won't be needing it and you won't have time for it, not even as a hobby. You will be lucky to find the time to take pictures of your kids' birthday parties. I'm going to guess that most of you will pass on this option.

The next option is to find a niche and milk it for everything you can get. Become the best portrait photographer or bridal photographer or generic little gold guy 3D illustrator or whatever. But it is going to take more than specialization. You are going to have to convince the customer base to buy your services over everyone else that decides to squat on your niche. That is going to take a really solid self promotion campaign and branding. You have got to become "ACME Generic Little Gold Guys Incorporated." And for those of you who recognize who I am referring to here you may also recognize that he does one hell of a lot of self promotion. It is hard to find a active thread on SS without at least one appearance by Generic Gold Guy. And if you think the buyers aren't reading the forums, think again. They don't post much but they certainly do read.

However, the most popular and most successful path for most of the independent business person class is diversity. This is more often referred to as "self employed". It involves a very wide variety of skills. You become a jack of all trades. There is a discussion on SS right now over what is a professional. One guy said that if photography doesn't account for 50% of your income you are only a hobbyist. I replied that there have been many times in my life when I had two professions. At one time I was doing engineering on my kitchen table by day and janitorial at night. I guess since I made less at the janitorial that was my hobby. He replied that it sounded more like I was just working two jobs. Um...no...they weren't jobs. They were my own businesses and that is how a great many independents operate. I have almost always had at least two different business interests going at the same time and I was very much professional at all of them.

If you plan to be just a general, small time operator then you will do best by at least diversifying within photography, or even better, the profession of imaging including illustration, painting, photography, sculpture...basically any part of the industry you can get your fingers into. And that includes doing commercial contracts, weddings, portrait work, stock imaging, travel photography, artistic prints, Cafe' press mouse pads and T shirts, etc. etc. Merchandise yourself. And again, your biggest task will be self promotion. You are going to have to convince the customer base that you are better than every other Joe Blow with a camera. You are going to have to somehow bring them to your products and convince them these are the right products for them, because there are a million other people out there doing the exact same thing.

So now we have a good idea of the basic options available. Which basic direction do you plan on taking your business? Professional business person, specialist, jack of all trades, or some mix of the three? Of course, if you have a good business plan you already made this decision long ago, right?