The World Is On Fire

Again. It’s not the first time, certainly we have seen sweeping changes in the way we live and do business, even in our lifetimes. Mechanical transport, electricity, telephones, air travel, radio and television – all these and more rearranged lives and businesses. But they did so at a relatively ordered pace since the infrastructure required to implement and support the advances did not exist, particularly outside of developed countries, and had to be built. Each one would build upon the previous as they progressed throughout the world. But now, as we are in the throes of the information age, or the digital revolution, or whatever you want to call it, the ordered pace of progress has become a firestorm and it is burning across the entire globe almost daily.

This is a key difference in several ways, but don’t miss this word: global.  

The party has gotten much bigger – instead of a few thousand people influencing your life you now have to contend with 7 billion. You needn’t dig very deep to understand how enormous a change that is. The basic methods of doing commerce have and continue to evolve in new and exciting ways, and as a result well-ordered, step by step career plans have also become a casualty. “Build” has been replaced by “pivot” as the new mantra. Pundits and professors alike are talking about business models that are more akin to chaos theory than an old time business plan, and they are not speaking in jest. (The fact that I can call it an “old time business plan” and you didn’t blink should tell you something.)

The intrinsic value of a patent or copyright has gone up in smoke as well.

A disturbing statement for anyone in the licensing business. Oh, the law hasn’t changed, it still grants ownership rights and a registration grants you more rights and some clout, but you know that doesn’t really matter if someone in Ethiopia or Vietnam ignores it. And it increasingly doesn’t seem to matter to 16 year old bloggers, wanna-be artists or the occasional Etsy designer showing off their, or is it your, creativity. Everything you do gets laid out on a worldwide digital stage. There is a school of thought wherein we are moving toward a cloud state where information and knowledge is a commodity owned by all and the concepts of authorship and origin will fade away. It is seductive in some ways to talk of free expression, shared innovation and the freedom to build upon each others ideas. Unless of course that affects how you feed your family, then maybe not so much, but unfortunately no less real.

I don’t have the answers, and even if I did they would only be right for me…for about 10 minutes. It is an exciting time for those who go to bed and wake up thinking about what they could, how they would, maybe they should… and then they do. It is a frightening time for those who look back at how they used to do things and wonder how to bring that about again – a sad waste of talent. You can’t stop a tsunami, sometimes you can’t even swim with it but you can climb above it. Run like the wind. Go!   

Atlanta Tidbits

Normally I would toss these eagerly awaited gems out there and let you digest them as you will, but this collection from the recent Atlanta Gift Market seem to be wrapping around a couple of messages. The first is that the business is back – it was a great market and there are similar reports from those that followed; Dallas, Las Vegas, Chicago, LA and the NYIGF all reported significant increases in attendance and sales. For instance:

It’s like the good old days

- a showroom client about the Market

It’s nice to see our customers with their chins off the floor.

- a showroom client

The second point that I see being made is that the days of one-off designs, what I call the single snowman problem, are definitely waning. Yes, I've said this before, and yes, there will always be a gift bag here and a paper plate there, however for the first time we are hearing the clients articulate - almost as a group - that they are hunting for something bigger and better. These were all comments from different clients at different times over the six days we were there:

Most anyone can draw a picture, we want more than that.

- a licensee

It’s hard to put a finger on where this market is going so I don’t know what I want.

- a showroom client

We’re really looking for something that’s more than pattern based – everybody can get patterns.

- giftware licensee

We’re looking for properties that we can get behind, develop and sell across a number of categories for the next 2 or 3 years.

- art director of a large multi-category company

No one can afford to do continue doing these novelty collections that are in and out right away, so we want ideas we can carry over to next year and expand upon.

- a giftware manufacturer

And then there are a few random beauties:

This can be a thankless business.

- an agent lamenting the unexpected end of a long term artist relationship

I’m sorry but I just don’t want to be all that helpful.

- a successful artist in a discussion about the social licensing groups

This whole “everybody is an artist” thing makes me want to throw up. It’s just not the case.

- an agent

And of course my favorite:

For God’s sake, how many of these tilty-headed, big-eyed woman designs can this market absorb?

- from an agent walking the show

The Road Well Traveled

I was reading an interesting article yesterday by patent attorney Andrew Spriegel about the realities facing inventors who approach him with what they are sure is the “million dollar idea”. You can find it here. After reading it through, I was struck by the many parallels to our own business and went back to it again with that as a focus.

And you know I love me them there realities…for instance:

For every 1,000 patents, only four or five will actually make it to the market and make any money; the rate is less than ½ of 1 percent. I’d say that in design licensing the percentage making it out of those portfolios would be similar.

Many inventors are too close to their idea and rely on family and friends for opinions instead of doing the market research to see if it there is a demand for the product, and as a result end up spending years and thousands of dollars on something with little or no market appeal. Boy does THAT sound familiar…

There is a network of “for-profit” invention mills that promise results but are only out to take the inventor’s money with no regard for whether the product is actually marketable. Hmmm….

Occasionally the best ideas that seem to have great promise don’t go anywhere. He stresses that the invention/patent process is often frustrating and you just need to keep moving forward. In our business this is absolutely true, and when (not if) it happens to you, stop and use what you’ve learned to retool, reinvent and then relaunch – either an improved version or a whole new idea. Sometimes our pet projects just are not going to work and that’s OK – fail fast, fail early and move on is the mantra.

He cautions inventors about selling out to a big box store like WalMart or Home Depot because their distribution models will produce only a small profit percentage for the IP owner. Well, ain’t it the truth. While big box retail margins stay high, we have seen a steady and relentless erosion of the royalties generated by products sold into big box markets (see the previous post) and there is no end in sight.

The point here is not to “dash dreams or slay hope” as he says, but rather to keep those alive by pointing out that your roadblocks are generally not unique, but instead typical of what one encounters while pursuing a successful creative life. Expect them, scramble over them and keep creating. Cast a wide net when looking for information and inspiration – you never know what will be useful and we can learn much from all those inventors, musicians, writers and others on similar but divergent paths.

And I bet we'll have a few things to teach them as well.

Bring It On Home

It would be funny if it was not so tragic. The headline reads “China Factories Eye Cheaper Labor Overseas”.  It’s well documented that labor costs have been rising – dramatically – in China over the last few years, something like 15 to 20 percent per year, and of course material costs for anything and everything have gone up worldwide.  Shipping is also skyrocketing, to the point where our clients tell us some factories will no longer quote hard prices – just an estimate that may change (upward of course) by the time they place the order. Countries like Bangladesh, Ethiopia, Vietnam and a host more are looking to pick up the slack, but the logistics of manufacturing in the middle of truly undeveloped countries will give anyone pause. Regardless, it’s a weird twist that the products we outsourced to China might actually be made in Africa by China.

Shouldn’t this open up more opportunity for us at home? Well…maybe… Art and design in America is inexorably tied to price – sad but true. We marvel at the beautiful pieces in a Scandinavian Design store and then wonder why we cannot buy them at WalMart. Everyone loves a Lamborghini or Ferrari, but every American company that has tried to build a high design car eventually fails. We crave Missoni, Mizrahi and Michael Graves but the only time we buy it is when Target rolls out a discounted collection. This is the state of consumption in America, cachet without the price, so is it any wonder so many of our jobs were displaced to countries providing cheap goods? You can try to blame corporate greed, but corporations react to what their customers want, and as a nation we want cheaper, cheaper, cheaper. Perhaps now the field will level a little bit and we can make an effort to support our own manufacturers and give them a reason to bring it back home again.

Ah well, a boy can dream.

Another article that hit my inbox today was about the new problem vexing big box retail, and it now has a catchy name: showrooming. This is the rapidly growing practice of using the brick and mortar stores to see, touch and feel the products and then ordering them online for a cheaper price. BIG problem for stores like Best Buy, Target, Wal-Mart and many others, especially for music and high end items like tools and electronics.  The first line in this article (from the WSJ) was “Target Corp is tired of being used” and my first thought was “well, that oughta bring snorts from anyone who has had the pleasure of dealing with them”. But all that aside, the basis of the article was that TGT has sent a letter to their vendors asking them to create products unique to their stores to help shield them from price comparisons (presumably by altering features or model numbers), and if that is not possible they want the suppliers to ensure they can match the online prices. Without hurting their margins of course.

Did you hear the groan from the experienced licensors out there? We already know that, working this backwards, that means retailers will extract more price concessions from the manufacturers, which means the mfrs will need to find ways to cut costs further which means – yup – we will all be invited to participate. Again.

Man, I am getting to dislike Amazon….

Atlanta and Some Exhibiting Realities

Whew. Just in last night from a week-long trip to Atlanta, staring at this pile of stuff on my desk (and floor, and numerous other flat surfaces) and wondering how I will ever get through it. So let’s write a blog post instead. As one of our customers said this past week: “We are a nation of A.D.D.”

We spent six days inside the AmericasMart, three of them exhibiting in the License and Design section and three more meeting with clients in showrooms, and all I can say is - wow. The atmosphere was electric, a wonderful change from the last few years; showrooms were crowded, orders were being written and there were big grins all around. A few comments:

“It’s like the good old days”

“We are up 15 or 20% over last year and it’s only Thursday”

“The showroom is going to set an all time sales record this market”

”I’m happy to see retailer’s chins off the floor”

Hard to argue with that. We had a great show, great meetings, great things happening - follow up is actually going to be fun over the coming weeks.

Speaking of the L&D show, we had a mix of new and seasoned exhibitors and talked to both (hopefully helping out some of the newer folks) but those conversations got me thinking about exhibiting realities. Now a person could write a book--and some have--about this, but there are some things they won’t tell you (or they just don’t know). After investing a couple hundred thousand dollars into exhibiting at dozens of shows we can offer a few tidbits:

1. You are not going to walk out of the show with a fistful of contracts or even firm commitments. Expect none, they don’t normally come until weeks or months later.

2. If there are people at your booth, potential clients will continue walking, so do not sit in front of your, or other, booths chatting and keep your friends away from the front of yours.

3. Make your booth approachable, have chairs (usually out front) for more than one person, make it easy to view your portfolio(s) and think about how you will deal with multiple customers at once. Do not expect them to come inside the booth, they don’t want to be trapped.

4. Carry your portfolios onto the plane or into the motel at night if driving – we never let them out of our sight before the start of a show – then you will always have something to show. Shipments do disappear, are sometimes late, and airlines occasionally lose bags.

4. This is not an art fair or a decorating contest. Wall displays have one purpose – to stop people so you can engage them. If it is too elaborate they often think “crazy artist” and stay away (same for your outfits…). Printed roll-up banners make life WAY easier.

5. This is a professional event so act like a professional. Wear business attire (your clients do). Have a business card and a handout sheet. Arrive well before the show opens and never leave before closing time. Plan on standing up for most of the show. Don’t eat in the booth. Smile.

5. Watch the agents – in addition to all of the above they will engage people in the aisles, listen carefully to and concentrate on their customers. There’s lots of laughing and hugging going on at their booths - it’s a people business and shows are about building and maintaining relationships as much as they are about showing art.

6. Attendees have a short time to see countless portfolios, and many are looking for only one category (such as Christmas or floral) so respect their time. Organize your portfolios by subject, I suggest at least Baby-Juvi, Everyday and Holiday and then get more detailed if you wish. Many will refuse to make appts at shows, and even if they do your meeting may be late, hurried or they may skip you altogether – just get over it, hitch up your dungarees and go back to sparkling.

Remember your art is not for everyone so many people will walk by with just a glance. That's just how it is so don't be concerned. Unless they all do - then it's a whole different conversation...

Ship It Now!

As I look back over the blog titles that did not see the light of day (yet), I am struck by how many of them resonate with the message that things have changed, that our biz is fundamentally different.

 Some were:

The End of Freelance, The Winner Loses (cattle calls), Is Art Licensing Dead?, What Now, Ten Things Your Licensing Coach Won’t Tell You…wow, enough of those, I’m even depressing myself.

So as I write this end of year blog, I am torn between A.) Happy Holidays and Have a Great New Year, and B.)  This Is What We Saw and It Ain’t Pretty.

Well, you know me…

So as I sorted through the multitude of topics, game changers worthy of a year end blog – I discarded the faltering economy, because even though it has significant impact it really doesn’t matter, business is good in some places and bad in others – just like it always is. I passed on the digital revolution, because it is pretty much old news now. If you aren’t rolling with the new opportunities provided by our digital world then it’s time for you to take your ball and bat and go home…game over. The new rules of competition almost made it, but again – if you haven’t figured out how you will innovate enough to stand out from the thousands streaming into the world of art licensing, well, get on the bus to home with the ball and bat person previously mentioned.  The relationship between supply and demand has fundamentally changed, and long term chronic oversupply is the new norm. So where does that leave us?

“Shut up and draw a picture already.”

It wasn’t me who said it...but I certainly could have. I came back full circle to the subject that started this blog, that subject being the art licensing coaches. Only now I can call it the Coaching Industry. Try searching “art licensing” and you will be confronted with line after line of how-to sites, fee and free both, looking to share expertise (regardless of whether they have it or not) about Art Licensing. The Google face of our little piece of the licensing world has been co-opted by merchants of opportunity who are selling the dream. I understand the people who are selling the programs, books, tools, etc. Many either don’t or can’t make any money licensing art, so they want your money and quite frankly most (not all) really don’t give a rip about whether you make any back. Trust me on this.  But then there’s the no-fee crowd, where the Art of Licensing has been replaced by the Art of Talking About Licensing.

Artists who freely admit that they are new to licensing are writing books and teaching classes on how to license, how to exhibit, how to approach manufacturers or how to market yourself. Other newbies are chronicling their step by step journey into the business, posting interviews, promoting how-to articles and short-cut tricks about a business they have never worked in. Am I the only one who finds this ludicrous? (Actually, no need to answer that, I’ve heard…). Sometimes these announcements make us laugh out loud, and others are actually kind of sad because their art is just so…awful... and we can see they will never have a career in this business. I do get the camaraderie and social connection, mutual support and all the rest of it, but there is an unfortunate message being sent with regularity – that if you work hard enough at learning the business you will eventually succeed at it – and unless you have exceptional art skills that message is wrong. Among the disservices being done to new artists that may be the worst.

 

So here’s my best advice for your New Year resolution:

Quit planning. Stop talking, draw some pictures and get them in front of someone who may buy them. Ship, as Seth Godin says. Ready, Fire, Aim. Thumb your nose at the coaches and write the check to yourself. The best way to learn this business is to jump in and do business. You cannot steer when you are not moving. Learn and reinvent yourself as you go, just as the business of art licensing will continue to reinvent itself while you are doing it. You’re not ever going to be ready, so launch and hang on for the ride.

I was awarded this fortune after lunch today at our little local eatery – truly – and I hope it will come to pass for each and every one of you:

Happy New Year!  

Somebody Help This Man!

I wrote a note to Chick-Fil-A today telling them how much they disgust me. Not their sandwiches, unfortunately I kinda like those, it’s really too bad I will never have another one. The actions of the corporation, however, merit the anger of every thinking person in the creative business world (and beyond). This is why:

“Vermont's Eat More Kale is a small, eco-friendly t-shirt business with a mission to promote sustainable food messages. The company's sole proprietor, Bo Muller-Moore, has used the EAT MORE KALE logo in his t-shirt designs for more than 10 years, and he recently applied for a federal trademark on his business name. A federal trademark would block other artists from copying his design (which has happened in the past) and protect the livelihood he's worked so hard to build.

But if Chick-fil-A, a giant multi-million dollar fast food corporation has it's way, Muller-Moore won't be allowed to protect his business. The Corporate Goliath has threatened to block EAT MORE KALE's trademark attempt and shut the business down. Chick-fil-A uses the slogan "Eat Mor Chikin,"and it alleges that EAT MORE KALE confuses CHICK-fil-A customers and dilutes its multi-million dollar industry.”

The above is quoted from a petition drive at change.org intended to help stop this case of arrogant bullying. Yes, you have to protect your trademarks, but do the lawyers at Chick-fil-A seriously believe the general public is so stupid that we just can’t tell the difference between “Eat Mor Chikin”and “Eat More Kale”? And that we will forget to buy their sandwiches because we are so confused by the Chikin – Kale conundrum? (Really, no need to answer that…)

Bo Muller-Moore seems like a really nice guy who cares about his fellow man and the world around him, and he certainly doesn’t deserve to be steamrollered by a bunch of out-of-control corporate lawyers. This is so out of whack that even the State of Vermont has joined the fight to help him out. You can check out his website here, and sign the petition here. You can also go to the Chick-fil-A website and drop them a note from there, which I did this morning. Do those things, and then buy one of Bo's shirts too because it just feels right.

Oh – and eat more kale, it’s good for you.