What's The Big Idea?

They did a little retrospective this morning on the CBS Morning Show about Andy Rooney who just passed away last week. I always enjoyed his commentaries, (a fellow curmudgeon bond) and I can only hope that I might still be commenting on the state of things at 92 years old. He did not suffer fools gladly, and one his pet peeves was that people often asked him how he could keep coming up with ideas for his writing. His response was along the lines of “How stupid is that? With all there is going on in the world you would have to ask about finding ideas?” He had a point – there is a universe of great ideas out there, and some people seem to be effortlessly plugged into it. If you are one of them, congratulations, if not – well, welcome to the rest of the world.

"Imagination is more important than knowledge."  - Albert Einstein

Generating fresh ideas can be difficult for anyone, however it can be a particularly thorny problem in a creative business – but only if you let it. If you read many of these posts you will know that I am a big proponent of innovation, in fact I would say that particular skill may be the single most important factor in the long term success of a licensing artist. And the beauty is – it’s a teachable skill, not just a gift. Researchers have learned that the creative process is much more systematic than previously believed, and you can learn how to better access those parts of your brain. Much work has been done on how to teach creativity by everyone from academia to corporations to the military – and it’s all out there for the taking. A Whack Upside the Head, Thinkertoys, Cats, The Art of Innovation, Creative Intelligence, and about a thousand other books are devoted to teaching you how to find and exercise your creative muscle.  Which is how you should try looking at it – it’s a muscle like any other that needs training and regular exercise to be at its optimum, and like any muscle in training, the more you work it the easier it gets.

Tidbits

I tend to save various quotes and pearls of wisdom that I come across on a many-page running document that I can pull up and read when I need some inspiration. Some can find their way into a blog post and others are so well said that they need nothing more – none are mine but they all can relate to our licensing world… so here are a few to start those wheels turning…

• No one can possibly achieve any real and lasting success or get rich in business by being a conformist.
  - J. Paul Getty

• Have more than one good idea handy.

• Remember, you can’t SELL anything to anyone; however you need to be there when people are ready to buy.

• Nice people can still have a competitive mindset.

• Markets and profits have changed with the new retailer driven market. Getting an item into Target used to be a very lucrative proposition; you could earn thousands of dollars over a period of several years. Now, you will often make only hundreds because they have beat the wholesale prices down and cranked their profit percentages up, and the only person left making decent money is the last one selling it.

• While the calculator on the ENIAC is equipped with 18,000 vacuum tubes and weighs 30 tons, computers in the future may have only 1,000 vacuum tubes and perhaps weigh only 1.5 tons.
  - Popular Mechanics article, 1949

• You can’t build a reputation on what you are going to do.
  - Henry Ford
  

• Most artists exhibiting at trade shows do not make back the cost of exhibiting.

• Small business is uniquely different from big business in just about every way - they are two entirely different animals. But there is an incessant parade of articles, books, papers, and research of giant businesses with the intent of showing us small business people what we can look like if we grow up and become a giant.  Most of us don't want to be a giant.

• Inspiration usually comes during the work, rather than before it."
  - Madeleine L'Engle, American writer

• 10 years ago I thought “I can’t wait to sign up to something… so they can tell me what to do, and give me bus, and give me a tour so I can sing” and finally realized… that doesn’t happen. They’re waiting for you to say “this is what I’m going to do and this is how I’m going to do it.”
  - musician Jason Mraz

• Ten percent of all the photos ever taken were taken in the last 12 months.

• You have ten seconds to get someone’s attention – don’t waste it by asking them what they need – tell them instead.

• “I’m looking for someone to fill that hole in the market.”
    - Simon Cowell about the X Factor

• Each year over 30,000 people graduate from art schools in just the U.S.

• And of course that old Wayne Gretsky standby – so overused but so true:
  “I skate to where the puck is going to be, not where it has been.”

Any thoughts or have any to add? Let's hear 'em...

I hear the train a'comin'...

It's rollin' round the bend...ya just gotta love Johnny Cash.

There is a measure in traditional publishing called “sales per book” that has often been used as a measure of the health of the industry. How many total sales, how many books published. Not a refined measurement, just a single number that can be tracked. This number is predicted to dive - big time - next year, as digital innovation wreaks havoc in a mature industry.

An industry is defined as mature by a number of factors, one being that it has passed the “emerging” and “growth” phases and has reached a plateau where it grows, or shrinks, along with the rest of the economy. (Sound familiar?) This is usually a time where companies tend to be stable, growing slowly if at all and improving profitability is their focus. For investors, mature industries tend to be a safe haven, and while individual companies in the industry may continue to come and go, the industry practices and products are mostly homogeneous.  The timeframe here can be years, decades or even longer – look at tires, oil, tobacco, steel, insurance, utilities, even airlines – not much has changed below the surface. This is blue chip territory.

While it sounds pleasant and relaxing, it’s a dangerous place for an industry. The only way to increase market share is to take it from your competitors, either by price or by innovation.  The trick is to not fall victim to game-changing innovations that you did not see coming. Ask Kodak, Xerox, Borders and a hundred advertising agencies – they can tell you.

You could also ask a hundred graphic designers. 

For many, many years the graphic design model has been based upon a step by step client/designer relationship: Here’s my project/OK here’s an idea /No, not what I wanted/ OK how about this/ I like that/ Here’s my bill. For a freelancer, agency or employee it was basically the same script. The mass access to design software took away many of the simpler projects, but being able find their way around the software did not automatically make them competent designers, so the business model continued to work.

 And then design went global. Websites popped up offering design work, many through “contests” that have dozens of designers submitting work - to spec – to “win” the fee, often 100 – 300 dollars. DesignCrowd, Mycroburst, 99Designs, 48Hourslogo, Crowdspring, Choosa, Brandstack, GFX Contests, Design Outpost, Design Contests, Pixish, Blurgroup, ODesk, Hatchwise, ShopForDesigns …see the problem? These sites already account for literally tens of thousands of designers and have paid out millions of dollars. And don’t kid yourself – a fair number of those designers are top level talent who are thrilled to get a 200 fee. That goes a long way in many parts of the world.

So what does this have to do with Art Licensing? Let’s put it this way – that train is rumbling down our tracks too. Already some of these sites are offering illustration, and what I expect will happen is this: these companies are going to come around to licensing as a way to utilize these assets – both the crowds and the huge libraries of designs that they are building.

 This has the potential to be a definite game changer, but instead of deciding if it is good or bad, think about this - now that we see it coming, how does one stay in front of it? Any ideas?

Don't drift - paddle!

There is some interesting discussion out there in blogworld about the “new” route to success in this business, part of which concerns the apparent shift away from the requirement that an art licensing artist has well developed drawing skills. Not very many years ago there was zero chance for success without those skills, but the continuing refinement of design software has opened up the field to some of those who did not spend their childhood sleeping with crayons under their pillow. This is not to say that the design standards are necessarily lower, or that average work will get you licensed - actually quite the contrary - but there are more ways to get there. It is now possible to express artistic talent through software, and like any sea change this has its share of detractors, and some are declaring it invalid.

Go read this interesting take on it from the UK’s Blue Strawberry here, and then come back…

Not too sure about their Real Artist conclusion but I love the idea of “product drift” in design software, though I would be inclined to call it a user access shift but let’s just run with the first tag.  Drift concepts have application in a variety of disciplines, one of the more familiar is language study (linguistic drift), where it relates to how a language can retain a basic format but exhibit certain significant variations, or drift, in various geographic areas. You writers should be familiar with that. Probably more applicable for us is the enormous category of “concept drift” which is the domain of mathematicians, computer scientists, statisticians, and other areas of study we really don’t want to fully understand. It deals with the inevitable effects of a dynamic datastream on a predicted target variable – in short what you thought you knew (the target outcome) actually changes as you collect new data, therefore the model you are using to predict that outcome needs to adapt constantly to reflect the new information and accurately predict a new outcome. (I know you theoretical math people are choking on that, but it’s the best I can manage in one sentence… and hey, we’re talking art licensing here…)

Machines and software find this almost impossible to do, because it requires them to “learn”, however our brain should be able to accomplish the task – if only we will let it. If you have been in this business for a while, don’t give up your advantage by struggling against the drift. This is a product driven business, and it is not so much about how you get there as where you end up - best to save the art snobbery for the galleries. If you need to change your way of thinking and working (your model) to get that product on the market (your target outcome) then you should take a deep breath and adapt. You can consider it a difficult time or an exciting time for Art Licensing – the choice is yours to make.

Cha, Cha, Cha, Changes...

When you are licensing art for products you will, sooner or later, be faced with the situation where a manufacturer requests, or requires, that changes be made to your design before going into production. These can be as simple as moving some text or a border, or they can be complex, like a total colorway change, a character redo or more. How you handle the request may be more important than you think – it can kill a project and even make or break your future with that licensee.

A good license agreement will have language that specifies what can happen, and who can do it. This is from our standard contract:

Any alterations or modifications of Artist's original artwork for Licensed Product(s) deemed necessary by Licensee shall be performed personally by Artist unless Artist explicitly consents, in advance and in writing, to modifications performed by Licensee.

Pretty simple and straightforward, it allows for control of the situation while leaving the door open for the licensee to make the changes – which is often the most efficient route. We very rarely see any objection to this clause except in a last minute rush situation. Below are a couple of paragraphs taken from agreements that we have seen (and rejected…):

[Manufacturer] shall have the right to make changes or alterations to the Design Art, including but not limited to changes or alterations in shape, color, shading, form, size, and positioning of the Design Art, which may result in derivative works of the Design Art (hereinafter the “Derivative Works”). Changes to the Design Art may be made by [Mfr] in [Mfr]’s sole discretion.  [Mfr] does not require approval from Artist for changes made to the Design Art. 

 Licensor hereby grants to Licensee a license to use the Design in the preparation of the work in the following respects (the “License”):

a) Modify the Design

b) Reproduce the Design

c) Sell the Design

d) Incorporate the Design into other products created by Licensee

The first one is bad enough but the second is a complete mess – none of the clauses A to D are acceptable for a variety of reasons that go far beyond design changes.

The point here is twofold: think about what changes you might be willing to accept long before you are confronted with them (if for no other reason than to get comfortable with the idea), and make sure that you will have some input regarding those changes through the language in your agreement. Ninety nine percent of the time all of this can be effortless because you put everyone on the same page from the get-go.

Defend yourself!

My friend Ketra is one of the more astute people I know, she has one of those nimble minds that can quickly hone in on the realities of a situation. She is also unencumbered by years of experience in the “old” licensing world - which gives her a fresh perspective, something that is difficult to achieve for those of us limited by our hard-earned certainties.

She used the phrase “a property that is defensible in the market” in conversation a while back, and it keeps popping up in my head. It’s a little twist on one of the commandments of investing – that the company you are considering is able to maintain a defensible market position – but it nicely highlights what is happening in our business right now. I have harped aplenty about the changes wrought by technology and the influx of new artists, but when I think about it in terms of maintaining a defensible position, I come to this conclusion:

It is no longer possible for the majority of artists in this business to gain a competitive advantage in the market, and without that they are simply another one of many with essentially the same offering.

When that happens, in any discipline, the perceived value drops away and your customers are no longer willing to pay a significant price for your services. You need to look no further than logo services or website design for examples – either can be had for 99.00 now. It’s not that there won’t always be a need for another Santa or snowman or stylized flower – certainly for the immediate future that will be true. But will it be worth your time to compete with 500 other artists to supply it? Actually, is it now?

But we don’t have to worry about the competition because we all have a unique product!

But do you really? From Julie Rains of Wisebread:
“The harsh truth is that your customers may not understand, need or even value the differences between your company’s solutions and those of your competitors. Cheaper versions that fulfill similar functions are preferable.”

When your product is a commodity, customers tend to choose solely on the basis of price or even on how much they can get for free. However - if you can bring a rare and truly unique set of skills and designs to the market and can show them something they haven’t seen before, or they can’t get from anyone else, then you can stake out your turf and charge admission – and that's a whole lot more fun.

Think Like A Brand

Most artists in this business would agree that their goal is to someday be a “brand”. So have you spent any time picturing what that would look like? Visualization is a powerful tool for helping to achieve your goals – so lean back and think about it…if you were a brand, you would….

Define the essence of your brand. Successful brands are perceived by their customers as the best or even the “only”. But this is a lot more than just product awareness, it is an almost automatic recognition of what they are, or in your case what you do. Can you define that for your brand? No? Then most certainly your customers can’t either.

Know your category cold. How much data do you think Coke and Pepsi have on soft drink consumption? How much do the Radisson people know about business travelers? How much do you know about art licensing? About your customers?

Protect your territory. Do you think the people at Lee are Tweeting their followers at Levis about a great new distribution channel they found? Of course not. You may have noticed that the big names in this business almost never reveal client names or share specific opportunities. If you want to be a professional you need to act like one.

Nurture your followers. Brand followers believe that “their” brand exists for the benefit of the customer, and successful brands work hard at never giving them any reason to doubt that. Brand loyalty, and how to keep it, is primary in everything they do. If your client wants it tomorrow, send it tonight. If they ask for an alternative sketch, send them two. Happily.

Be consistent, and consistently excellent. A tall order for sure, but a basic building block of a successful brand. Whether you walk into a Starbucks in Seattle, Minneapolis or Miami, you know the experience will be the same – and it will be almost perfect. The same goes for a McDonalds, or an Apple store, or a Nordstrom…this is what makes them who they are.

Innovate. Constantly. Everyone expects the best from the best. Brands have a laser-like focus on making their product better and keeping it the best on the market. Followers look to their brands for the next big thing, and if you can’t provide it they will soon look elsewhere.

Believe in your product. The people at Tom’s of Maine know they have the best personal products on the market, at Method they know they have the best soap, at Ben and Jerry’s they know they make the best ice cream. If you know you are putting out the best art available for that product then your clients will too.

If not, well, go back to Starbucks and learn how they do it….