Now here’s the funny part:
The one thing that ad agencies should actually bill clients for, the one thing that clients can’t do themselves work a lick is creative—the ideas. The brilliant tagline. The award-winning commercial. The iconic logo and/or brand identity. But nope, agencies make enough money hustling markups that many would rather treat the creative product like cheese in a mousetrap. Creatives like myself come up with brand-building ideas—catchphrases that become part of the lexicon, pop culture changing moments, imagery that gives a faceless corporation a personality people can relate to… And for our troubles? We get an annual salary, maybe a little bit of change per day or per project as freelancers.
You see, creatives don’t get a cut of the markups or a percentage of the sales or anything like that. We lose ownership of our work soon as our bosses see it. We sign contracts (even as freelancers) making our agency/firm the sole owners of the concepts and campaigns we develop, whether they use our work or not. The agency then signs agreements with its clients making them sole owners of all creative work developed during the relationship whether the client uses it or not. So the client really is getting its creative ideas for next to nothing. So why do things this way? Because it’s a hustle; and in a hustle you’re a hustler, an angle to be worked, or overhead to be used and tossed when the time comes.
Every client and ad agency has one thing in common: they’re businesses. And businesses only understand one thing: Formulas. And because every client is different, and every idea should vary by need, budget, target audience, etc. there’s no formula for determining the true value of marketing ideas and creative concepts. I mean, how do you bill “Just do it”? How do you bill “Where’s the Beef?” How do you bill “Jared, the Subway guy”? In other words: How do you bill clients for tailor-made disposable intellectual property, which is what advertising and marketing is?
As a copywriter and brand consultant, I say it’s simple: Like athletes and actors, creatives should be free agents and negotiate contracts for their services based on their track record, portfolio and potential, and let them get whatever the market bares. Specifically, a creative would get an upfront fee for time and energy spent on developing creative ideas plus some type of usage royalty, licensing fee plus a cut of the client’s sales over a specified time frame. Or better yet, since building a brand is literally about adding equity to a company, creatives who produce top work might earn stock options. After all, in most all cases, a company’s image is just as important to its success as the product/services it actually provides.
But it’ll never happen.
Why?
One: Because it’s a fundamental paradigm shift, and unless they cause it, change scares the snot out of most businesspeople. Plus, most agencies are still so big and/or inefficient that they can’t afford to do anything but maintain the status quo. Two: Just like every kid thinks he can rap, every brand manager, account exec, CEO, etc. thinks they can write a great tagline, a hot commercial or design a lasting logo.
When push comes to shove, many businesses believe the only reason they’ve hired an ad agency or a marketing firm is because they’re too busy to do the creative and media buys themselves. And that’s why many clients still treat marketing as overhead in their business plan. That’s why when business goes bad the first thing to get cut is the ad budget. This is also why agencies treat creative work like door prizes and party favors. And that’s why ad agencies and marketing firms run the hustle that they run.
Suckers.
Anyway, with the sculpture idea, the client could’ve just hired sculptors, told them what to carve, where to carve it, and been done. It would’ve been neat, quick, and effective. And our company wouldn’t have made squat. Oh, we might’ve gotten a small creative fee, but that’s about it. And of course, that was unacceptable. So like good little kids, we did our ads, our bosses sold the client on ‘em, and we promptly out-spent the statue idea—by a lot. And the client paid us. (Ta-da!)
Whether it’s a blue chip brand with a multimillion dollar budget or a mom ‘n’ pop shop with baby bucks, the marketing hustle’s the same: Budgets. Get the budget up, spend the budget up, and then get the client to re-up the budget. The golden rule on budgets: Use it or lose it. (Ask any politician or CEO and they’ll tell you the same.) It’s hard to justify needing “more” later when you didn’t spend “all” now. So if the client wants to go “right” send them “left” because “left” is more profitable for you. I saw it with almost every client almost everywhere I worked.
You see, creatives don’t get a cut of the markups or a percentage of the sales or anything like that. We lose ownership of our work soon as our bosses see it. We sign contracts (even as freelancers) making our agency/firm the sole owners of the concepts and campaigns we develop, whether they use our work or not. The agency then signs agreements with its clients making them sole owners of all creative work developed during the relationship whether the client uses it or not. So the client really is getting its creative ideas for next to nothing. So why do things this way? Because it’s a hustle; and in a hustle you’re a hustler, an angle to be worked, or overhead to be used and tossed when the time comes.
As a copywriter and brand consultant, I say it’s simple: Like athletes and actors, creatives should be free agents and negotiate contracts for their services based on their track record, portfolio and potential, and let them get whatever the market bares. Specifically, a creative would get an upfront fee for time and energy spent on developing creative ideas plus some type of usage royalty, licensing fee plus a cut of the client’s sales over a specified time frame. Or better yet, since building a brand is literally about adding equity to a company, creatives who produce top work might earn stock options. After all, in most all cases, a company’s image is just as important to its success as the product/services it actually provides.
But it’ll never happen.
Why?
One: Because it’s a fundamental paradigm shift, and unless they cause it, change scares the snot out of most businesspeople. Plus, most agencies are still so big and/or inefficient that they can’t afford to do anything but maintain the status quo. Two: Just like every kid thinks he can rap, every brand manager, account exec, CEO, etc. thinks they can write a great tagline, a hot commercial or design a lasting logo.
When push comes to shove, many businesses believe the only reason they’ve hired an ad agency or a marketing firm is because they’re too busy to do the creative and media buys themselves. And that’s why many clients still treat marketing as overhead in their business plan. That’s why when business goes bad the first thing to get cut is the ad budget. This is also why agencies treat creative work like door prizes and party favors. And that’s why ad agencies and marketing firms run the hustle that they run.
Suckers.
Anyway, with the sculpture idea, the client could’ve just hired sculptors, told them what to carve, where to carve it, and been done. It would’ve been neat, quick, and effective. And our company wouldn’t have made squat. Oh, we might’ve gotten a small creative fee, but that’s about it. And of course, that was unacceptable. So like good little kids, we did our ads, our bosses sold the client on ‘em, and we promptly out-spent the statue idea—by a lot. And the client paid us. (Ta-da!)
Whether it’s a blue chip brand with a multimillion dollar budget or a mom ‘n’ pop shop with baby bucks, the marketing hustle’s the same: Budgets. Get the budget up, spend the budget up, and then get the client to re-up the budget. The golden rule on budgets: Use it or lose it. (Ask any politician or CEO and they’ll tell you the same.) It’s hard to justify needing “more” later when you didn’t spend “all” now. So if the client wants to go “right” send them “left” because “left” is more profitable for you. I saw it with almost every client almost everywhere I worked.
This thing is bigger than mean and you.
This is big business. This is the American way.
—Nino Brown
This is big business. This is the American way.
—Nino Brown
Oh, one more thing:
Truth be told, marketers really can’t guarantee much of anything. Maybe consumers will like my product, maybe they won’t. Maybe they’ll respond to an ad campaign, maybe they won’t. Maybe they’ll pay $10 for this movie and $20 for that CD, maybe not. But “maybe” don’t pay salaries. “Maybe” doesn’t land new accounts or get budgets approved. Banks don’t do loans for “maybe.” Shareholders don’t buy stock in “maybe.” I need guarantees. The only guarantees are budgets and BS. So, out comes The Hustle: Inflate the overhead. Wag the dog. Flex the formulas. Get those budgets as fat as possible. Right or wrong, it’s consistent income and businessfolks love consistency. Sure, clients could revolt, but then who’d do their work? As it stands, most companies still don’t know how to market what they make and they know it. But more importantly, we know it.
Still, most marketers work hard to do right by clients. But the revenue must flow in order to keep The Beast fed. So at some point the artificial markups and blown budgets come. And as they come, the markups get passed on the client who then passes them onto you, the consumer. Now if everything works out and the consumer bites (and buys), then everyone’s coffee gets cream. But if it doesn’t, if sales slump and we all just take the L while our accountants, comptrollers, and CFOs duke it out with the taxmen and shareholders. Meanwhile, it’s back to the drawing board.
Still, most marketers work hard to do right by clients. But the revenue must flow in order to keep The Beast fed. So at some point the artificial markups and blown budgets come. And as they come, the markups get passed on the client who then passes them onto you, the consumer. Now if everything works out and the consumer bites (and buys), then everyone’s coffee gets cream. But if it doesn’t, if sales slump and we all just take the L while our accountants, comptrollers, and CFOs duke it out with the taxmen and shareholders. Meanwhile, it’s back to the drawing board.
I know half my advertising budget is wasted
every year, I just don’t know which half.
—William Wrigley, Sr.
every year, I just don’t know which half.
—William Wrigley, Sr.
