17 Aug 2015 Creative Market Review
Creative Market is not your typical microstock agency.
Instead of controlling and presenting all of their content, they provide a marketplace where contributors are in control. Contributors can create themed bundles of content, set their own prices, and customize their own ‘shops’ on the site. They also carry a wide variety of content other than just images. It’s well worth your time getting to know this agency better.
From Artistic Community to Stock Imagery Business
They came up with the idea for Creative Market based on market analysis performed on the consumer base of an earlier product they developed together: the color and design app and online community, COLOURlovers.
Although COLOURlovers’ income curve was not huge, its traffic definitely was, exceeding one million registered members in a single year. When a big brand bought a user-generated pattern on the site, the founders saw new potential for growth. After a few more market tests, they committed to bootstrapping Creative Market as a spinoff platform. The new start-up secured first round funding of $2M in 2011, enabling a public release in late 2012.
Unique Distribution Model
Creative Market wants to make online commerce more organic and personalized. The founders like to compare it to a local farmers market. Growing their business out of an existing online community had a lot to do with this perspective.
Contributors do not just upload images to the catalog. They open their own shops on the site to display and sell their work, at the prices they choose and with no approval process. The site encourages buyers to directly contact the creators whose work they like, promoting individual relationships between buyers and sellers.
Creative Market was conceived as an integrated content source for designers. The founders wanted to eliminate the disruption of the creative process that happens when a designer has to take their focus away from their tools to purchase assets within a web browser. This is a key distinction between Creative Market and other content sellers, such as Envato, who they’re often compared to.
On this platform, all files, tools, and assets are in the same place. They made a big move toward creative process integration in 2013, launching a private API simultaneously with a Photoshop Extension that enabled direct access to their interface from within the design suite. They’re one of the companies that has recently begun offering bundles: fixed packages containing multiple file types, normally designed around a cohesive concept (a theme, a subject, an author) and very competitively priced.
When it comes to business, they have a very contributor-focused structure. They offer a standard RF license (Extended Licenses coming soon) at a high 70% royalty rate for all content, and there is no exclusivity requirements nor lock-in period. But the key features are the self-pricing structure, the lack of a review process, and the absence of sizes –all photos are sold at their maximum resolution.
The only way they curate content is through a restrictive application process. At first, joining the site was by invitation only. Eventually, they added a ‘Become a Partner” tab, but the selection process seems to be strict. However, once accepted as a contributor, you can start uploading and selling immediately.
Although they started with only graphic design elements, at the end of March 2014 they introduced a handpicked collection of high quality photos, and users started creating stock photo shop-fronts. Currently, the stock photo catalog has over 171,000 files available – very small, but limited to the “authentic” images everyone is talking about these days. No stocky stock here.
An Innovative Approach That Pays Off
COLOURlovers was vital to the rapid success of Creative Market. Building a strong community before venturing into stock imagery turned out to be a very effective business strategy. The app’s loyal followers supported the new platform, providing an instant base of thousands of users contributing to the site and spreading the word about it.
For contributors, the model is very appealing. High royalty rates, self-pricing, no review process, no lock-in, personal storefronts, site management promoting their work. Sounds like a great deal to most of them. Although the web is full of successful contributors’ stories, it is clear that to make good money at Creative Market, you must deliver unique and polished designs.
The up-to-date, high quality galleries and shops, ensured by the strict contributor selection, are a great selling point for buyers. Customers know they won’t be surfing through lots of poor designs to find something worth paying for.
How’d They Get So Big So Fast?
By Q4 2013, after one year of operation, Creative Market had grown by over 1,600% and exceeded revenue milestones from other online marketplaces like eBay and Etsy. Their catalog featured over 20,000 collections, generating roughly $1M in royalty earnings for sellers. They added staff members and developed more than 20 new features. The rapid growth convinced investors to contribute an additional $2.6M in funding, enabling the development and release of the Photoshop extension and private API.
The company was beginning a third round of funding in early 2014 when Autodesk, the developers of AutoCAD, came along with a purchase offer for a non-disclosed amount. Epstein, Williams and Monsef had developed, released, and sold Creative Market in 15 months.
After two years of operation, the company reported 325% annual growth in their 2014 review, with a total of over 620,000 members (currently over 1 million) and 6,000 shops earning millions of dollars, with a single shop reaching over $43,000 in sales in one month. They hired more staff and continued to add features and develop their platform.
According to the founders and the CEO, the Autodesk deal was a positive step toward for their long-term goals. They all initially kept their positions, integrated into Autodesk’s main offices, and retained their company’s vision. They believe this new partnership will help them reach new frontiers in the online design world.
Those frontiers are now taking shape with a new category of 3D assets appearing on Creative Market, and the Creative Market content being available directly in Autodesk’s app 3ds Max, with obvious parallels to what Adobe has done with its Fotolia acquisition.