In advance of some coming 'Growth Surgeries', IP innovator Erica shared her thinking around actionable ways that agencies can unlock value that's hidden in their businesses.
When we met Erica she told us about a question that crops up repeatedly in the creative agencies, studios and consultancies she works with: ‘What do we own?’, which is quickly followed by ‘What can we do with it?’
In an industry that largely follows a ‘work for hire’ principle, the model leaves agencies owning very little, and clients owning the rest. But in reality, when looked at from a different angle — most companies do own various intellectual assets/IP which are just waiting for their chance to generate income. These assets may be hidden, their value unrecognised, or there is little understanding how to generate revenues from them — or they are given away.
And when people talk about IP, they mentally park it in the ‘lawyers’ remit. But this could not be further from the truth… IP is meant to help creative people benefit from what they create.
In advance of a series of Growth Surgeries we hosted a quick fire presentation, and following Q+A to help interested agencies understand what IP and intellectual assets actually are, and where to find them in their company.
Here's what we learned.
Too often, clients regard creativity as a service, but Erica’s core belief is that “creativity drives value” – she champions creativity as a capital expense and investment. To demonstrate this, she highlighted that “UK creative industries are worth 90 billion, and yet it wasn't even identified as a sector in the governments figures until 2010. Yet aerospace, automotive, manufacturing and defence collectively still equate to less.”
Therefore, she is striving to create a new way of thinking in agencies to make them more resilient. Her aim is for her clients to have “6 months money in the bank, and a whole raft of different revenue streams to make you have businesses that are really viable in the long term.”
What you own: Intellectual Assets
Most companies are unaware of intellectual assets, yet this is where power really lies. IA is “absolutely everything that has got you to here now. That includes your childhood, what you loved at primary school, who you worked for, who the rest of your team has worked for... everything.” But what is key to IA is how one takes these assets and reinvents them – IA is worth very different things to different people. To explain, Erica used a baking analogy:
If you make a sponge cake you use sugar, eggs, flour and butter, and baking know-how. These are your intellectual assets. Bought for about two pounds, a sponge cake is usually eaten around teatime – it has a limited window. However the same ingredients could be used to make more expensive products like meringues, cupcakes or pancakes. While they all require baking know-how, these three very different foods, all with completely different sale models and audiences.
She applied this when working with Mary Portas’ agency. “What has come out has been extraordinary,” she explained. “That team came up with nine different revenue models within the agency itself of things they could do to earn revenue in different ways that they had never even thought of”.
What you own: Intellectual property
From design rights to trade secrets, next Erica shed light on the key areas in IP, placing emphasis on the following:
You have automatic copyright for everything you produce. In fact, it was learning this the hard way that resulted in the founding of Lola.
When working with Nat Geo, Erica was part of a team developing ways to repurpose its abundance of archival content. Eventually, they founded ‘Anipals’, a concept that would comprise archival footage developed into five-minute children's films, with the end goal of adopting a game format that could be sold in Tescos. However, upon registering for a URL without copyright, the very next day someone elsewhere registered the copyright out from under them.
Trademarks are an interesting way to build your business, and Erica explained the value of trademarks by looking to one of her clients, Without.
When Erica begins working with agencies, she encourages them to write a list of all the clients with which they have ever worked, and those by which they have ever been paid. When she looked at Without’s list she “realised its clients were all in a really interesting bracket that could be summed up in a name.”
For this reason they developed a name for this group – ‘Urban Adventurers’ – and they registered the name for a trademark. Since, Without has based their entire marketing strategy upon urban adventure and written a book on the trademark, which has in turn brought them a great deal of business.
Patents can fundamentally change a business. The case study Erica used to highlight this was the story of her work with Smith & Sinclair – the brand using cocktails to make sweets. Three years ago she got on board with its founders to help establish the business. A critical stage in the collaboration was Erica’s introduction to Wrigleys’ IP attorney.
Seeing as no other business was able to achieve what Smith & Sinclair was, the attorney provided them with a foodstuffs patent for suspending alcohol in Gelatin; and 4 years on, the brands turnover is two million and is on its way to getting a global patent. Businesses can now not make similar products without getting a license from this company – in fact, this small business’ patent actually halted innovation at Diagio.
What you’re putting out there
The next most important thing for agencies to consider is “what you’re putting out there” Erica explained, as “potential clients see three things: websites, creds and contracts”. And all three can be used to shift power.
“What you put out there is about power,” she continued. “On my website I have a little grid of all the clients that I work with. I work with really great companies, so what I do on my website is say, ‘you can be part of this fabulous network’”.
But in addition to this, it’s vital to be opportunistic and proactive. Don’t just use your website as an opportunity to say what you do, but as a place to say what it is you want to do – otherwise the opportunities will not arise.
Erica’s next advice was, when you are invited to talk about your creds, change your game. “Talk about all the different revenue models, or things you're doing in different ways with different clients. That will excite clients in different ways to your competitors.”
Most contracts are about defensive mechanisms. However Erica advises that they should be about opportunity. She told the story of her work with the new agency Truth&Spectacle.
The team needed help in owning its IP, and approached Erica to write its contract, which they wanted to be about opportunity. She therefore addressed the flaws of commonplace contracts, which would risk putting Truth&Spectacle in a child-like position with client being the parent, and rewrote it to shift it to a partner relationship.
To do so, she introduced a permission clause, which would give the company permission to come up with new and inventive ideas around a business’ model and services, but would also ensure that it owned the IP for those ideas – until agreed how to be exploited with the client under a different contract.
Location:72 Rivington Street,
London, EC2A 3AY,
Start:February 20th, 2018 at 6:30pm
End:February 20th, 2018 at 8:00pm