13/06/2014

BLOG: Getting on with Business

People might like to demonise the ‘suits’ from the ‘creatives’ but, in reality, business and creativity can co-exist quite nicely if you just get a grip.

There’s nothing worse than walking in to a shop and being confronted with a million different types of product. You wonder why the shop exists, what is its purpose? Well, the exact same thing goes for agencies. I see too many small creative agencies trying to be anything and everything to all clients.

They do too much: design, apps, brochures, videos. It’s too broad and it’s bad for business because when you become non-specific your marketing spend becomes a drop in the ocean. There’s no way you can hit an audience that wide, you’d need a budget the size of a multinational!

Now, marketing yourself might be a dirty concept among creatives but unless you’ve got clients banging down your door then it’s necessary. Marketing has been the lifeblood of my agencies; it’s meant that when one of our big clients leave we are in a position to quickly win new business. Any company, creative or not, should have a refined proposition and know how to sell themselves.

That’s not dirty – that’s reality. When first opening shop, the name of the game is defining your agency. Bizarrely, many creatives fall into the trap of thinking that means producing stand-out project after stand-out project, irrespective of whether they turn a profit. After you’ve taken the decision to set up a business, you can do that once or twice but afterwards every piece of work should make you money or else you’ll end up as busy fools. Otherwise, what are you in business for?

Start-ups in the creative world often feel as though every piece of work has to be award-winning. That’s wrong, maybe 20 per cent has to be award winning and the rest has to be profitable. Churn it up, get it out the door and make money on it. Those jobs help fund the award winning pieces which, due to the extra time and creative they require, probably won’t make much profit themselves.

That’s not to say any of my companies have ever set out to create poor work. It’s always to a standard, but we only ever really push the boat out when you have a client who has financially afforded you that luxury. You might be a creative but you also have to realise that you’re in business to make money. If you make money you can grow and that enables you to go off and be more creative.

There are so many two-man bands who don’t get that; they never grow and normally shut up shop around year two. It all really depends on who you fit in to your organisation and what it is you want out of business. For many the ambition isn’t to grow but to survive with a lifestyle company – and that’s fine. If you want to grow, however, you need to decipher who the profitable clients are; and in my experience they are not always the most creative ones. We keep time sheets for every job we undertake and at the end of the year it becomes crystal clear that 20 per cent of our projects weren’t profitable, they were underfunded and expected too much.

One popular argument for undertaking unprofitable work is that it might get you a great brand’s badge on your website but, really, how great is a company if they can’t even pay full rate? And do you really want to take the risk of bringing on 10 staff for a supposed ‘great, creative project’ only to have no wages for them come month’s end? How much is that badge really worth?

I’m never worried when we turn away business over price issues because we price our margins accordingly. If we then lose work because somebody has undercut us, then I’m confident that they’re not going to make money. If that’s how they do business then they won’t grow and thus are not a competitor to me. They can do what they like.



MUBALOO

Mubaloo has taken the same creativebusiness approach to apps as founder Mark Mason’s previous venture, Mason Zimbler, took to advertising; and in four years has produced work for the likes of The Met Office, BP and William Hill.

Illustrated by Rebecca Kaye

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