What Is An Idea Worth?

8 responses.

The most exciting and profitable part of my business is often also the most frustrating — valuing our ideas.

After all, clients don’t come to us because they want to be patrons of the arts. They call us up and hire us because they have a problem and they need to find someone to help them solve it. Of course this is not a new phenomenon. Based on my reading I often wonder if the Medicis hired Michelangelo in 1512 because they wanted to support his talent or because the ceiling of the Sistine Chapel was stained.

Creation

Sometimes client problems are really problems of implementation – they need a website built or a brochure created by a certain date. Maybe they need a media plan strategized and carried out or maybe they need a new signage and wayfinding program. They come to us because we’re good at what we do, sure, but they also come because they know we can get it done – on time and on budget.

But the clients who really value what we do and who get the real money making ideas from us are the ones who come asking for a strategic solution to a big problem. How do they change their brand to address the new demands of a more diverse marketplace, for example, how do they profit from the new realities of an economically powerful Latin America, or how do they introduce and manage new media into their successful but quickly aging traditional marketing plan?

These clients know they need to change and they know they need new ideas, they just don’t know how to find them. And so they come to us.

Our best clients, the ones who give us the latitude and the resources we need to do our job, are also the ones who get the best results. That’s because we can come back to them with breakthrough ideas that change their consumers’ perceptions and create the powerful brands that build business.

When Michael Earley was named CEO of health care company Metropolitan Health Networks, the stock price was in a death spiral and had fallen to a record low of 85 cents. We helped Michael create and build four brands, including MetCare, AdvantageCare, Symphony Health Partners and ContinuCare. Last month, Michael and his team sold Metropolitan Health Networks to Humana for approximately $850 million at a share price of $11.50.

AdvantageCare_Logo-copy

When Bill Talbert took over the reins at the Greater Miami Convention and Visitors Bureau 23 years ago, the community was rocked by a number of disasters that kept visitors away in droves. Today, our “It’s So Miami,” campaign is on everyone’s lips and Miami is one of the most valuable tourism brands in the world with record attendance of over 13.4 million visitors in 2012.

ISM-Ads

When Hank Yunes hired us to reposition his company’s retirement communities, the financial crises had forced housing prices to new lows. Just one year later, our Younger Next Year branding program had increased home sales by over 62% in their properties outside of Orlando and Phoenix.

Avatar-YNY-Billboard

With successes like those, you might wonder how valuing ideas can be frustrating. After all, we’re very well paid to help our clients build their businesses. But here’s the problem: before we go to work, and before our efforts pay off, our pitch of great ideas and compelling brands is just a promise. It’s not until after our ideas are implemented and begin to bring in business and dollars that our clients can truly see the advantages.

Because of this disconnect, we’ve had clients who have looked at our solutions and said, “I could’ve thought of that.” Needless to say, they hadn’t thought of it yet, but that reality didn’t stop them from devaluing our ideas. After all, if you sit an infinite number of monkeys at an infinite number of typewriters, one of them will type Shakespeare. But you have to read an infinite amount of monkey babble before you find it.

Of course great clients like Earley, Talbert, and Yunes see the value up front and encourage us to do whatever it takes to respond to their needs. And these are the kinds of guys who look at our presentations and never say, “I could have thought of that,” but instead nod, smile, and say, “I should have thought of that.”

Recognizing the value of an idea, and the difference between “should’ve” and “could’ve” is often the difference between success and failure. And de-commoditizing our services to better differentiate our solutions from other generic practitioners is our challenge for the new year. My guess is it’s yours, too.

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  8 Responses

  1. on March 6, 2013

    Good points Bruce. I like your use of case studies. So, what’s the difference between a $10,000 identity mark and a $100,000 identity mark? $90,000 of assurance from an expert.

  2. on March 6, 2013

    Thanks for the post Bruce. Devaluing creative work such a slippery slope. The bane of so many young talented creatives who set off on their own only to compromise the value of their product in hopes of getting traction for their business. I saw Bob Gill of Pentagram speak many years ago and he said that when a logo is done right, people should look at it and say ‘Of course, what else would it be?’. A great lesson I’ve learned many times over-it takes a lot of hard work to make something look simple. I use that for context when clients want to make suggestions on design, copy, art direction, etc. If we’re making it look easy enough that they feel they can do it, then in a way it’s a compliment to the work we’re doing. Not good management on their part and not good use of our time or their money but at least it helps us keep things in perspective.

  3. on March 6, 2013

    The value of an idea – is the value you give it.

    -RG

  4. on March 6, 2013

    Great post and I’m glad you wrote it as bluntly as you did for it applies to other forms of consulting, not just branding.

    It comes back to the core reason why someone wants to hire a consultant. Is it to approve a favored conclusion? Other nefarious reasons? Or is it that the competency, creativity and innovation sought is not resident within the organization and there is a clearly defined, short term need.

    A client that knows the outcome (value) they want and can clearly articulate the competencies and type of relationship sought from a consultant will reap the greatest value.

    My firm doesn’t do branding – we do business strategy and customer experience consulting. Customers like Good Technology, Social Dynamx, Dot NetNuke realized value well in excess of the fees they paid because they knew how to partner with a consultant.

    If one goes about hiring external help based on the cheapest price, throw-it-over-the-wall, shop-by-deliverables approach, that company will not reap the fullest value from the relationship.

  5. on March 9, 2013

    I’m going to take what I am sure is going to be an unpopular tack here. This has been an age old question for sure. However, the reality is that the value of ideas is the value the market places on them. What is the value of a lifeguard who saves your life at the beach? Surely more than the minimum wage he/she is making. However, the job is so popular and there are so many choices of qualified applicants that the city doesn’t have to pay them the value of a life – in fact they barely pay them more than minimum wage.

    And herein lies the problem. The true value of something is very often far more than the amount the market will bare due to competitive forces, supply and demand, and perceived differentiation in product and/or service. Very often this relates into a true bargain for a client. However, what happens on the flip side when the idea fails miserably? Is there a refund or a penalty? Until agencies or consultants are willing to participate in the downside it is unlikely they will get access to the upside.

    Now let the skewering begin :)

  6. on March 11, 2013

    I don’t think any skewering is coming, Len, because your points make a lot of sense. “The value of ideas is the value the market places on them” is absolutely correct. And agencies and others who want to benefit from the strength of their concepts do need to take the good with the bad when they negotiate performance corridors.

    The values of ideas are also the value the creator places on them. After all, a transaction requires at least two participants and if the seller is not willing to accept the buyer’s price then nothing happens. Fame, celebrity, reputation, track record, and all sorts of other soft assets all work to make one creator’s idea worth more than someone else’s.

    Thanks for jumping into the fray!

  7. on March 12, 2013

    Thanks Bruce! And yes, when the sellers are willing to walk away they can stand firmer on their price. Herein lies the issue in the agency world though – the prisoner’s dilemma! As long as some of the agencies are willing to break ranks and accept lower value, they force down the entire competitive market. And with the barriers to entry so low, there is always going to be someone willing to play at the low end. Those who have the fortitude (and the liquidity!) to hold out, be selective in clients, and stand firm behind their value, though, will likely have the greatest success in the long-term (assuming the quality of the work is there). Thanks for the engaging discussion.

  8. on March 12, 2013

    Right again, Len. “The prisoner’s dilema” is a smart way to describe the problem.
    A while ago I wrote about “The Auction You Cannot Win.” I used it to explain a different point but it also talks to your idea of the steady downward spiral of lower and lower pricing. Here’s the link: http://turkeltalks.com/how-to-beat-the-auction-you-cannot-win/
    Thanks for your insight.

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