Mar 01 2010

Give Away Your Ideas – Charge for Implementation

Published by at 7:56 am under marketing

In the advertising world, there is much hand-wringing and consternation about doing work for pitches.

The basic argument is that doing work for pitches amounts to doing work for free. Of course, Creatives and many mid-size shops are aghast at this practice and want it to stop immediately.  “Our creativity is our life blood,” they declare, breathlessly.  “Why would we ever give it away?”

But, this approach to business courtship is only growing.  It’s in no danger of dying for marketing, but instead is expanding deeper into the consulting industry, finance, accounting, and supply chain management. It’s also a rock solid way to get ahead in your own career.

And if you want to be competitive, you will embrace the idea of giving away your creativity, and charging for implementation.

Let’s look at why this is a good idea starting from the end of the process: everyone has to eat. The bottom line is that you need to be able to charge for something. Everyone understands that, and it is the whole reason that you are working, instead of playing squash, or backgammon, or watching CSI.

So, what are the right things to charge for?

Creative people want to be able to charge for ideas. And there are some people that can do it. If you are a top screenwriter, you can walk into a pitch meeting with an idea, and walk out with a green light. Andrea King and Andy Marx did just that with Squeezed and Tour de Frank in 2007.

But that is not a bankable strategy because it is not predictable. King says as much in the linked interview – you make more money selling spec scripts that are finished, vs. selling pitches, where there is just an idea.

What is a more consistent solution is to charge people for great execution. That means that your creative concepts are solid, but they take someone who really knows what they are doing to pull it off correctly. You then become the natural choice, because it was your idea, so you know how to pull it off.

Creatives think that this model devalues their work, but they couldn’t be more wrong. The creative solution is still primary to the process. Without the creative solution, there is nothing to execute. The creative solution is the sizzle. But you make money on the steak.

The truth of the matter is that great ideas are all around us. That’s obvious just from looking at the blogosphere. Blogs are the largest collection of creative thought ever created. And more than 99.999% of the blogosphere is people giving away ideas (there are a few people that blog for a paycheck, but usually the paycheck comes from writing long-form articles or opinion pieces, then blogging on top of that…for them, blogging is the frosting and their other writing is the cake).

So, while your idea might be the best idea, you won’t ever be able to see it come alive unless you give it away. Saying to a prospective customer, “we have awesome solutions; hire us and we’ll tell them to you,” is a one-way ticket to the reject pile.

7 responses so far

  • robertmoss

    Giving away the creative and charging for the execution fails to address the problem with pitching. Does it make good business sense – as more and more agencies pitch for a single account – when the chances of winning, though not be as bad as the odds of winning lotto, are significantly reduced and, therefore less and less likely to achieve ROI?

    It costs a great deal of resources to pitch new business: time, talent and money – all of which can be used to keep current clients happy.

    To say as you wrote above that, “…a more consistent solution is to charge people for great execution. That means that your creative concepts are solid, but they take someone who really knows what they are doing to pull it off correctly. You then become the natural choice, because it was your idea, so you know how to pull it off.”

    So how do you demonstrate that you know what you’re doing to pull it off? Case studies? If that’s the case, there’s no need for a pitch – just look at what the agencies have done for previous clients and take some time to see if there’s a good cultural fit. You know, talk, hang out, date, go Dutch even. Does a client respect an agency that puts out on the first date?

    Moreover, does the pitch process accurately portray the real world client-agency relationship? How many agencies *won* a new account by *giving away free creative* only to let it go a year or two later. See Mitsubishi + Deutsch (Marina del Rey, CA) + BBDO (Los Angeles, CA) + Traffic (El Segundo, CA) + TBD, see http://bit.ly/d2YNwO and http://bit.ly/be0sTK Yes, same Lancer photo, different story.

    How many agencies are willing to chase after a smaller and smaller Mitsubishi account with a history of short-lived relationships? 180/LA (Santa Monica, CA), and Cutwater (San Francisco, CA), both Omnicom, and independent Barrie D'Rozario Murphy (Minneapolis, MN), that’s who. And that’s after the RFP and the first cut. The *winner* will be Mitsubishi’s fourth lead creative agency in five years (ah, but she’ll be the one!).

    To get back to the problem of too many agencies pitching one piece of business, a number of Belgian agencies – including JWT, Ogilvy & Mather, BBDO, Saatchi & Saatchi, and McCann Erickson – have staged a virtual strike, see http://bit.ly/df05oP Will it work? I don’t know but it shows there is a problem with pitching that can’t be simplified as give away the creative and charge for the execution.

    What do you think?

  • Thanks for your comments, Robert. You make some great points.

    I think that there are some fundamental changes in how agencies and clients work together that are unfolding now. With average CMO tenure down around 18 months, it's just not prudent for any agency to expect that a pitch is going to end in a multi-year engagement.

    AOR relationships might still exist, but they are becoming less common and shorter.

    That means that agencies have to adjust the investment that they are willing to make in the pitch process to align with this new reality.

    I, too, like the idea of dating before getting married, but clients are more like serial-monogamists now; they are not looking for a “til-death-do-us-part” relationship.

    So, how do you prove that you have great execution? By having not just a killer creative concept, but a thought-out strategy with tactical recommendations in place at the pitch. With the right technology partners lined up. With references and a strong portfolio.

    Oh, and all of us have to get ready to work even faster!

  • Jamie, you’re welcome. I’m amazed that so many agencies claim to understand strategy in their pitches and yet are willing to treat going after new business in the same spirit as an amateur at a Las Vegas bachelor or bachelorette party. There’s not enough Alka-Seltzer in the world to relieve all the agencies that participated in Zappos’s RFP, once it degenerated into such a fiasco, see http://bit.ly/cSodT

    But back to your point. I’ve never worked on a pitch that presented solely a big idea without various tactical executions, e.g., broadcast, print, outdoor, online, experiential/event marketing, guerilla, apps, etc., including bringing on a lot of groovy technology partners to roll the whole thing out. It’s a lot of work representing an incredible amount of non-billable hours, which brings me back to how to reconcile the idea of giving away creative (and I include all the tactical elements that are part of a pitch) and then charging for executions that never take place?

    Can agencies merely reduce their pitch process investment and reveal a slimmer, less costly presentation? Will clients respond with, “Is that all there is?” Or can they acknowledge the times we are in and act as business partners with a mutual goal of everybody being able to earn a healthy profit. If not, we can look forward to fewer people employed, a diminished tax base, reduced public services, and people owing more on their home than it’s currently worth. We’ll need to do more than work faster.

    What do you think?

  • billy bee

    The three of us may be the only people reading, but I find this interesting…so, thanks for posting. The biggest variable is the people/relationships. I don't think it takes very long to figure out what a potential client really wants. Do they want to see creative in a pitch? (And I do agree that creative in the form of case studies is good creative.) Do they prefer to work collaboratively on creative? If an agency doesn't know and can't ask, it should not be pitching the business.

  • iangoldsmid

    providing an ongoing stream of ideas seems to be a dimension Branding – positioning, gaining attention, interest, stickiness: and then the client might just pick you to do some work that they already know they want – because they get your creativity and focus, relate to that, like it …. anyway, yes idea generation is more of an early stage marketing tactic than it is a product to sell – agreed !

  • Your proposal presumes the creatives process can be recouped during execution – but when execution is triple bid and given to lowest cost proposal (not highest quality) that goes out the window.

  • Yes, you're right – that's why agencies must take care to pursue clients and partners in a strategic way, focusing on what they do best, specializing in narrower niches, and saying no.

    Clients must also understand that lowest cost work is like fast food – tastes good going in, but hastens your own demise. Frankly, I don't think this is a huge problem. Most businesses have a procurement process in place that considers cost, but not to the exclusion of quality. It's tough for agencies to hear that their work didn't hit the mark as well as someone else's; it's easier to dismiss criticism as a pursuit of cost savings above execution.