6 Reasons Why Microstock Earning Will be Down in 2015

Microstock sales has been on a declining trend since the middle of 2014. It looks like this dreadful trend will continue to 2015 and more. Below are 5 reasons why this downtrend will continue.

1. The strengthening of US dollar against Euro and other currencies may seems to be positive thing at first. But in reality, buyers are taking a major hit. European, being the biggest buyers of microstock is having a tough time as Euro has hit 11 year low vs the USD. This means, buyers will be buying less stock images because it is much more expensive now. So far, my number of sales has gone down by about 30%.

2. More and more well establish stock factories are producing amazing number of qualities images everyday. To be honest, I am not sure if they could actually cover up the expenses to produce these images given the golden era is over, but this intense competition is not a good thing for lone ranger like us.

3. Another bad news would be iStock HQ is being moved from Canada to USA now. This means, we will have to pay 30% tax to US government if the purchase is being made from USA. Moving forward, I predict my earning will be at least 10% less from iStock now.

4. Stock agencies are getting more and more sneaky by manipulating numbers and playing with their system to benefit themselves more than us, the contributors. Cutting royalties, and introducing confusing sales packages and partners site are some examples of such manipulations.

5. Microstock is now being treated as commodities. The prices are getting hammered due to stock agencies pricing war. Nobody win in this situation, except the buyers. 

6. Smaller agencies such as CanStockPhoto, Crestock, GraphicLeftovers, and GraphicRiver are starting to feel the pressure with lack of regular sales. Inactivity is the scariest thing for Internet business. Check out all the 0 sales for new vectors at GraphicRiver http://graphicriver.net/category/vectors?page=1. It is very demoralizing to see such sight. With the weakening of smaller agencies, bigger agencies will soon take even more control. This is not a good thing.

As a conclusion, I predict 2015 will be a pretty bad year for us. There will be a lot of contributors giving up this year. It may no longer be worthy to be a stock vector artist now. In 2009, you can make $100/month. In 2015, you can only make $10/month with the same images.

Shutterstock Vector Sales Not Doing Well

Vector graphics earning in Shutterstock had been on increasing trend for a very long time. Contributors were working very hard to produce more and more high quality vectors. The competition was stiff as ever, but we survived. Not this time, though.

Reading posts from everywhere around the Internet, I can see that we've probably hit the peak somewhere in 2013. 2014 is a decline for Shutterstock and it is still declining. Yes, probably only Shutterstock is declining because other agencies have been neutral. Sad, but true.

I am seeing a sharp drop in my sales at Shutterstock just like everyone else. Many have come up with theories such as:
- search algorithm changes by Shutterstock
- server uptime issue
- summer holiday
- tight competition among contributors
- Getty giving away free images
- ... and many more...

Everything above could be true, but I personally don't think of that. I think Shutterstock is losing clients.

Fotolia introduced DPC (I have opt out because I don't like the idea).
IStock introduced subscription model.
DepositPhotos and 123rf are advertising heavily.

All these are hurting Shutterstock sales and we don't see our overall earnings spread evenly because the income of our vector images are getting less and less everyday in other agencies when they "silently" played around with their royalties, ranking system, and buyer packages.

The trend of "race to the bottom" is also worrying one. Agencies are fighting a price war. Contributors and agencies are suffering because of this. Jon Oringer knows this (who would have know better, if not Jon?). If I am Jon, I will probably start diversifying my investment into other new revolutionary ideas.

Single and Other Downloads Brings Joy to Shutterstock's Contributor

I have been submitting my vector graphics to many different agencies in the past 3 years, and it seems that only Shutterstock is improving in a very constant and improving ways. The IPO of Shutterstock must have really been working out. To be frank, I have been really skeptical about the IPO because it means "change". I don't want to it to change because it has been good so far. But, Shutterstock proves me wrong. Not only the sales has been improving, but the feature of the sites are upgrading too. One very good example would be the Follow, Set, Same Artist, and Customer also Liked features. These features bring back sales to old images and open up an opportunity to new images too. I love how they want their buyers to maximize their download, instead of playing cheeky -  since the more subscription downloads a customer used, the less profit for Shutterstock.

Let's get back about sales in Shutterstock. The very special thing about what's happening recently is the "Single and Other Download" sales  A customer cannot see this package in Shutterstock's Subscribe Page.
So, how exactly Shutterstock bring in these "Single and Other Download" sales? I suspect this is done by a real salesman that walks into a customer office, and sell it.

The prices of "Single and Other Downloads" varies from $0.88 to $120.00. Nobody knows what's exactly happens to it and how did it took place. But, recently Scott Braut from Shutterstock hinted us about it. Here's a snippet of his explanation:

While individual user reports might be describing a variety of customer purchases, we also had a single large-volume educational book publisher purchase a large number of licenses today. 

High "single image" royalties are often the result of a prenegotiated agreement with volume buyers such as large publishers and advertising agencies. These volume buyers may require additional license or workflow features, such as the option for sensitive use, indemnification, multi-user accounts, prenegotiated pricing, and special billing and workflow features.

There goes the two very important point, "large-volume education book publisher" and "prenegotiated agreement". This is important because this means Shutterstock is doing something more than just online marketing. They are now sending marketing agent to workplaces and sell our images. One of my friend told me that IStockPhoto agents do come to his office and sell/market/negotiate prices. They show his boss about new and interesting photos + "gently warn them" not to steal their photos.

Contributors has been reporting a good sales on "Single and Other Downloads" recently, and I hope this continues. While we are really happy about it, we should also hope Shutterstock can cover the cost of their marketing, because when it don't, we are the first to be doomed.

Shutterstock's Strategy: Boosting Sales For New Stocks

Have you ever wonder why your newly uploaded stocks at Shutterstock gets more downloads compared to other agencies? That is because Shutterstock has a strategy that keeps new stocks get better visibility.

Let's compare the search filtering choices we have.

Shutterstock
1. Most Popular
2. Newest
3. Oldest
4. Random

IStockPhoto
1. Best Match
2. Age
3. Downloads
4. Contributor
5. Rating
6. Size
7. Title

Fotolia
1. Best Match
2. Date
3. Price
4. Downloads
5. Popularity

Dreamstime
1. Relevency - Descending
2. Relevency - Ascending
3. Download - Descending
4. Download - Ascending

5. Upload- Descending

6. Upload- Ascending

7. Resolution- Descending

8. Resolution- Ascending

Shutterstock only has 4 choices (Most Popular, Newest, Oldest, and Random) on the search filter. Let's understanding them better. Oldest filter is pretty much useless because I don't think buyers want to look for old stuff. Random is also useless because it don't return you with good results at all. So, Shutterstock literary forces its buyer to search for Newest and Most Popular. I don't know the actual algorithm behind the Most Popular filter, but from my experience, it is able to give chances for new stocks to appear on it pretty quickly. If your stocks has a few downloads each day after the first few days of upload, it can then be quickly shoot to the top of Most Popular. I believe Most Popular has something to do with number of views, downloads, and age.

Because Shutterstock's search don't have other choices like Number of Downloads and Rating, older stocks don't have the advantage of being grandfathered, thus new stocks have chance.

I believe Number of Downloads or Rating basically kill off new stocks. Simply take a look at other agencies, 3 years old stock will always be on the top of Downloads due to obvious reason. Rating is prone to abuse and I believe that it favors older stocks in some ways as well.

The more search choices an agency has (that does favors new stocks), the less visibility we have for new stocks.

So, if you are a grandfather in stock agency, then you will feel that IStockPhoto, Fotolia, and Dreamstime love you in a constant way. And you may not feel the same for Shutterstock because it doesn't favor your 10000 stocks which is 3 years old now.