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Transparency

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I went to see Hot Tub Time Machine on Saturday — an incredibly silly comedy about going back in time to 1986.  No Internet, no cell phones, no Ipods, almost no device that we all rely on today to manage, inform and entertain us.  Literally, I think many of us would be lost in 1986 as to how to actually function in that world.

Yet, when I look at so many of the models for creative businesses operating today, they look more like 1986 than 2010.  Cost plus pricing still rules the day for so many of you delivering actual goods.  An ephemeral “fee” (no matter how many line items you put on your proposal) prevails for those of you who focus on providing services.  Underlying all of your models is the presumption that you do not have to be transparent with your client – they will just have to trust you to be fair with them.  In 1986, you could rely on your reputation and referrals to legitimize your prices and how you operated.  It simply was not worth the effort to check up on you.  In 2010, your clients often know your costs and your competition better than you do.  Google makes it that easy.

What it means is that you have no choice but to be completely transparent with your clients.  They need to know how you derived the cost of your goods and/or services and how it is that you will deliver them.  You do not have to be the lowest cost provider or apologize for what you charge.  However, you do need to be able to defend why you charge what and how you do, more than “that’s what the market will bear”.  Vicente Wolf wrote a post recently about how he prices his interior design work.  Whether you agree with how he does it or not, you can absolutely see that his clients know exactly what they are buying and how his business works.

Transparency is integrity, respect for your clients and your art.  The grace of today’s technology is that, regardless of your reputation and talent, your success depends on your ability to be fundamentally fair and candid in everything that you do.

Build Trust

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Your clients do not hire your creative business because they NEED your art.  They hire you because they WANT it.  Even more to the point, they hire you on (blind) faith that you will deliver what you say you will.  To secure the business, all you can do is try to form a relationship with them and let your portfolio, reputation and business process carry the day.  What you cannot do is try to win it with a proposal.

Sending a proposal to get business can do nothing but create a hurdle of distrust between you and your client.  How can you say what your art costs before you create it?  Who is to say that what you can create for your proposal is something they will want and/or feel like they have received value for?  What you are doing by earning business on the basis of a proposal is saying to your client: “trust me, I know what I am doing, you are going to love it.”  Would you trust you after hearing that, with nothing of substance to back it up?

All clients have budgets.  Your job is to meet, not beat, that budget.  Win the business because you are the best artist for the client.  Build trust by showing your client what you will do for their budget.  You can and should receive a retainer to begin your process, but only as much as you need to cover your costs to create and present your work.  Once your client sees and approves your art, then they will feel much more comfortable paying your fees.  And, no, they do not get to take their design home with them unless they pay for it.  Creating your design on spec is as bad as trying to win business with a proposal.  Your art is all you have.  Clients have to pay you to create it for them.

Your process has to be about building trust, not just assuming it as a given.  If you give yourself the opportunity to present your art before you submit your proposal, you will have a much easier time justifying why you charge what you do.  If your client does not like what you have created for them, they can walk away (without your design) and you have been paid enough to have made the exercise worthwhile.  Better to suss out a wrong fit as early as possible than go down the road where you stand very little chance of being successful.

For those of you who say that that is just not the way it works, ask yourself how it got that way.  Clients focus on what things cost because they have nothing else to go by – after all, who is to say what a room by Vicente Wolf or Laura Kirar is worth — certainly more than the cost of the goods in it.  For the most part, when a client questions your price it is more a reflection that they do not trust you than it is an unwillingness to pay.  Rather than give in to that distrust (i.e., negotiate your price), focus on the power of your art and your ability to demonstrate its value to your client before you ask them to pay for it.

Love, Passion and Desire

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Talent alone used to carry the day. The reason: it was hard to find out who was talented and who wasn’t.  If you were, and people knew it, you had the advantage of being known in the circle that mattered.  Today, that is gone. There are no more hidden gems, talent is everywhere and everyone knows (and can see, read, and listen to) your work.

With talent a given, the only real difference is love, passion and desire.  Love for the art you create every day; passion for delivering that art to your clients; and an unending desire to use your creative business to grow your love and passion for all that you do.

I can see “it” within five minutes of meeting an artist: the twinkle in their eyes when they tell me about their creative business.  The way their voice goes up when they talk about their favorite design. The enthusiasm they radiate when they show me their art.  You can’t bottle it and you can’t fake it.

I deeply understand how tough the last two years have been for almost all creative businesses.  Even if this year looks better than last, you are still digging out from the hole of 2008.  I also do understand the necessity to keep you business going and do what is necessary to pay the bills.  However, I will challenge you and say that your willingness to compromise might be more a function of apathy than necessity. Crisis saps desire, which kills love and passion.  No artist wants to do what they do because they need to.  In your best place, you do it because you have to in order to feel alive.  If you are, in fact or in worry, constrained by the “real” world every day, your creativity has less and less air to breathe.  And when your art becomes the means to an end, instead of both the means and the end, you are lost.

So do what you have to do, yes, but ask yourself if your love, passion and desire is still there or can be rekindled.  If it is, then get to the business of running your business instead of being run by it.  And, if it isn’t, then please be kind to yourself and give yourself the permission to move on to discover what may truly fuel you.

Know Your Business

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Once all of your marketing, networking and social media efforts drive clients to your door, there are only two things you need concern yourself with: turning potential clients into actual clients and servicing your actual clients unbelievably well.  Yet, all too often, when I ask where the business is in both of these categories, the answer is an exercise in “where are we with so and so…” to your staff, a let me rack my brain to see if I can remember it all, and a scan of your appointment book.

There is literally no more important information for you to know about your creative business.  No clients, no business.  If you are constantly trying to count trees, not only will you miss the forest, you will probably forget a tree.  What level of information you need on your potential clients and where your actual clients are in your production process is entirely personal to you.  Some of you need only know that everything is on track, others might need more detail.  Regardless of your preference, the information should be at your fingertips, always in real time and detailed enough for you to understand where you are, but not so much as to overwhelm you with the sales/production process.

Whether your creative business is just you or if you have lots of employees, the answer is the same as to how you generate the information on your potential and actual clients.  First, commit to providing yourself with the information at least weekly.  And, if you do have more than one employee, assign rotating power and responsibility to keep the information up to date.  Assigning power will require that the task be completed.  Assigning responsibility will make sure it gets done on time.  Rotating power AND responsibility ensures everyone’s cooperation.

The lesson here is for you to get out of the way.  You hired your staff for a reason – to help you run and build your business.  If you have hired well, they are all, as Seth Godin would say, indispensible and integrated.  It can never be that one person’s best sabotages another.  Your job is to make sure that everyone understands that your creative business is a living, breathing organism.  Everything and everybody relies on each other and you will definitely succeed or fail together.

Today, it is not enough to tell someone to sweep a floor and then be upset when it isn’t swept quickly enough or in the right way.  The sweeper needs to understand why she has to sweep the floor how and when she does AND that her job is as important as ANY other in the business.  With that sense of empowerment, maybe she will be motivated to figure out how to sweep the floor in half the time, or, better yet, figure out how eliminate the step altogether.

You instill the value of empowerment and cooperation through the delivery of information.  The better and smoother the flow of information, the more you will empower and inspire.  With staff handling what is in front of your creative business, you can focus on what is most important – seeing around the corner and discovering where to go next.

Can You Change The Game?

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Before Apple introduced the IPhone, nobody could conceive of all you could do on a cell phone.  45 million phones, over 140,000 apps, 2 billion downloads later and we have just scratched the surface.  There may some day be a competitor that overtakes Apple, but it will never happen if they try to play the same game.  You need only look at Palm to see the futility of that plan.  In one master stroke, Apple turned a one-time sale into a growing annuity.  Amazing.

I hear all the time how fiercely competitive creative business has become.  Real Simple Weddings recommends brides find photographers on Craigslist to save money.  Wedding planners express frustration at all of the new very low cost entrants into the field with their willingness to do “day of” planning for next to nothing.  All designers complain about how aggregation sites like elance.com and ifreelance.com turn every project into a bidding war, yet feel compelled to participate.

That the competition exists doesn’t actually bother me.  Darwin’s law is what it is.  Nature is cruel, but fair.  Adapt and evolve or become extinct.  What bothers me the most is the response that so many creative businesses have to competition.  First, you focus on marketing what you do louder than the other guy with all of the tools in your social media arsenal – website, blog, Twitter, Facebook, UStream, etc..  As if screaming louder in a crowded room full of screaming people will make you stand out.  And, second, you try to make sure you look good relative to the planner/designer/photographer next door by making what you offer easily comparable to what he is offering.  I am sure the thought goes, if a client understands that you provide a better value than the competition (i.e., you are cheaper or will do more for the price), they will go with you instead.

Makes me shake my head in frustration.  The point of all creative business is to create a platform that best supports the art behind it.  The artist you are has to have a deep desire to be iconic or else you would not be doing what you do for a living.  Your creative business is no different.  Your goal should be to be LESS comparable to the competition, not more.  To talk to potential clients in a way that NO ONE else is talking to them.  You can and should build a better mousetrap that provides clients with only what is most valuable about you and your art and forgets about the rest.

All that being said, there are many artists seizing the opportunity to change the game – in the wedding world, Style Me Pretty, WeddingBee, Two Bright Lights and LiveBooks come to mind.  And there are start-ups like my Kate Parker Wedding and even the yet to launch NewlyWish Registry.  For interior designers, you only need to look at what Michael Bruno has done with 1st Dibs to see the possibilities that exist for you.

These businesses offer opportunities to help you do what you do better, yes, but what they really offer is insight into how you can adapt, evolve and, ultimately, redefine your creative business.

There Is No Spoon

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With all of the “expert” advice coming to creative business owners these days, it becomes easy to forget that there is no spoon.  The reference is to a line from the movie, The Matrix.  One way to interpret the quote is that reality is an illusion, and once you know that you can shape it as you wish.  A little far out philosophically for me and certainly for my blog.  I prefer the thought that the world is as it is, but the reality of the world is how you choose to see it.

Seth Godin, in Linchpin, tells the story of Richard Branson being trapped in the Caribbean (before he started Virgin Airlines).  The plane he was to fly on was cancelled and there wasn’t another one until the next day.  Sir Branson went to the charter desk to ask how much it was to charter a plane.  Then he put up a sign:  one-way ticket to Virgin Islands ($79), one-time only, limited seats.  He sold them all in ten minutes, covered the cost of the flight and booked the charter.  He got to the Virgin Islands a half-hour later than scheduled.

All of the blogs, seminars, conferences, workshops, etc. out there are completely worthwhile, provided you take them for what they are – an ability to expand your understanding of your world as it is today and even what it might look like tomorrow.  However, it is fools play to confuse the information you receive as THE reality or, worse, an immutable truth for your creative business.

I am not talking here about technical skills, such as maximizing your website/blog for SEO, learning CAD or accounting/bookkeeping basics. The availability of expert information that will make you a more informed artist and businessperson is incredible.  You should be forever learning and it has never been easier than today.

What I am talking about are those experts that are telling you how to apply the technical information to your creative business.  Just because someone has a background in law, accounting, finance, marketing, communications, web development, or retail doesn’t mean their advice on that topic as it relates to creative business will work for your creative business.  Only you can say whether your creative business needs an iron-clad client contract, Quickbooks, a detailed capital structure, a one, two and five year marketing plan, a web site/blog with all of the latest bells and whistles or even to price your work by doubling what it costs you.

No matter how similar (or big) the shoes the person you are listening to has, they are not yours.  And, at the end of the day, the only person with the right answer for your creative business is you.

Advice

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I love what I do.  I get to look at creative businesses all day long and dream about what they are doing, could be doing and maybe even should be doing.  I use the sum of all of my experience to see around blind corners, create new ideas and hone the best of what already exists.  And, like all artists, sometimes I am just dead wrong.  I rely (heavily) on people I trust to tell me when I am going down a road that does not smell right to them.

Everyone should have people in their lives that unquestioningly support everything they do.  These people give us the confidence to put it all out there in the first place.  Often, they see in us what we do not in ourselves.  However, if they can not be counted on to call you on the carpet now and again, these are not the people you should be taking business advice from, no matter how well qualified they might be to give it to you.

Likewise, you should also avoid listening to those that will put cold water on every idea/initiative you have.  We have all had experience with someone who likes to find the weakness of your plan as evidence of why it will not work.  Pointing out a problem is easy, solutions not so much.  Never allow someone to tell you their opinion on what “the problem” is, if they do not also have a suggestion on how to fix it.

The key is to find those who are willing to go down the path with you, but can smell when something is off (and are not afraid to tell you so).  My only caveat is to make sure these are your peers – people who have had real, lasting success in what you are looking to them to advise you on.  Don’t ask your accountant for marketing advice just because you like his newsletter, your web designer for PR advice just because you like her work (or her blog), or your lawyer for thoughts on strategy if you like the term sheet she wrote.

You have to constantly put your ideas out there to discover the gem.  By definition, this means you are going to come up with some lulus along the way.   Art is uncertain and risky.  Without permission to be wrong, you will likely wind up safe, stale, and broke.  However, if you are willing to put the ideas out there in the first place and surround yourself with those that will help you best filter them, the lulus will get their fifteen minutes and then fade away to make room for those that deserve a lifetime.

Fear

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I believe in radical change.  Rip the band-aid off.  Find myself in a wholly uncomfortable place.  I do not do it because this is how change has to happen, only because my fear would stop me if I didn’t.  Fear of failure, humiliation, shame, and all of the judgment that comes with standing apart.  And even after the radical change, no matter how positive, I am always trying to find my way back and somehow undo what I have done.  In so many cases, ripping the band-aid off is the easiest part, dealing with the newly hairless, scarred skin, the hardest.

Regardless of how you make changes in your creative business, beware of your fear.  Knowing where we have all been over the last few years, you probably now fall into one of two categories:

The first is that, with fingernails hanging onto the cliff, you continue to function in dysfunction.  Despite being inefficient at what you do – pricing, production, customer service/management – you survive (note: not live) because of the strength of your art and your charm as an artist.  You probably have cut back on everything but didn’t really change how you do things. You might be taking work that doesn’t fit your art, lowering prices, doing what you can to keep things going.  About now, you are probably on the edge of collapse – financial and physical.

To those of you who are in this category, first and foremost, I am so sorry and do so know the depth of the pain you must be in.  Your fear (maybe of function?) has brought you to the precipice.  However, it has also forced you to choose: change or die (your business that is, not you).  Dying might be a necessity, but likely it is a choice.  Many before you have dug themselves out of much worse.  In the face of your fear (and because of it), you now have nothing to lose and everything to gain from changing the way you run your creative business.

The second category includes those of you that have adapted your creative business to the world we live in today.  Some of you have re-focused on what the absolute strength of your art is and let everything else go.  Some of you now outsource everything you can to reduce the risk of the money you generate.  Maybe you have expanded nationally, even internationally.  No matter what steps you have taken, you can probably say that your business today looks almost nothing like what it did two or three years ago.  To the outside world it might look the same, but, to you, it is an entirely different being.

I am not commenting on whether you are financially successful or not, just that you have adapted.  But to you too, I would say, beware of your fear, especially if the real reason you adapted was because your survival instinct was better than your colleagues who did not adapt.  Change is a difficult process at best and old habits do die hard.  Just when you think you have let go of that which can not work for you any more, there it is again. However, the bigger point is that we are still at the beginning of the seismic shift in how our world operates and what works for you today probably will not tomorrow.  If you can continue your commitment to change, opportunity will also continue to present itself to you and your creative business.

What Are You Investing In?

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Preston Bailey wrote a terrific post last week about how he handles first meetings with clients.

Among many other gifts, Preston’s singular genius is his ability to relate and listen to his clients.  If anyone had license to ego, it would be Preston.  Yet he has none, especially when it comes to his clients.  From the moment they walk in the door, it is all about what THEY want, not what Preston can do to impress them.

Preston KNOWS he can take a client’s vision far beyond her wildest dreams, so he never sells it.  Preston spends his time when he first meets a client trying to understand what she wants, yes, but mostly trying to establish trust.  Every creative business owner should know what Preston does: trust is THE most important currency any artist can have – with it you can do almost anything, without it, almost nothing.  Once you know you have to establish, build and maintain trust to be successful, then you build your infrastructure accordingly.

For me, the most fascinating part of Preston’s post are the pictures of his office.  I count five designers on his design floor and six floral staff on his production floor.  Preston promises his clients that his designs will be incredible, unbelievable statements that will push the envelope of event design each and every time.  To deliver on the promise, Preston has invested his money in the resources that can best make that happen.  He could just as easily have a space on Fifth Avenue, spend a fortune on advertising and outsource everything (including his design team). But would he be able to deliver on his promise to his clients?  Probably not.

Your promise to your clients is limited only to you.  And it is up to you whether you put yourself in the BEST position to fulfill that promise.  Your resources (i.e., time, energy and money) are limited.  Too many times I have seen artists spend these precious resources on what they think they are supposed to be spending them on, rather than on supporting what it will take to best deliver on their promise to their clients.  How many amazing websites/blogs have we seen from designers, planners, stationers, photographers, etc. only to be let down when we discover that that is all there is?  If the money you are spending (whether on staff, technology, PR, etc.) does not ensure that the trust you have with your clients is never broken, you need to stop.  Today.

Lessons

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I am a sponge.  I believe everything and everyone is presented for me to learn something.

Yesterday’s Super Bowl reminded me that there is no such thing as a good or bad decision, just whether it was the right decision for the moment.  Sean Payton’s decisions to go for it on 4th and goal and do an on-side kick made a statement – he was behind his players.  They were the right decisions for the moment.  On the other hand, Tracy Porter’s interception in the fourth quarter, to paraphrase Malcolm Gladwell, is a testament that the willingness to take the greatest risk (and reap the greatest reward) is, at heart, instinctive.

The analogy for your creative business:  there are times when your decisions set the tone for how you want yourself, your art an your business to be represented.  And then there are times when you have to risk everything and live with the consequences.

Then there is Seth Godin’s new book, The Linchpin.  His unyielding desire for all of us to make ourselves indispensible is reason enough to stop everything you are doing and read the book.

Wrap Seth and the Super Bowl with the new series, Undercover Boss, and it comes to me:  the joy is doing the work, not the result; being an artist as much as creating art.  If a Waste Management customer can come out and hug her garbage woman, a port-a-potty cleaner can radiate happiness and a woman can work four jobs in devotion to her family, then the purpose is not what it is that you are doing, but your intention behind the effort.

The humanity (i.e., the art) behind any endeavor is what will carry you and your creative business forward. Everyone is scared of something and the more you run from it, the more it becomes ingrained in you, your art and your creative business.  However, if you do what you do from a place of conviction, you will give your employees and your clients the chance to embrace (and be irrationally loyal to) the art you create with and for them.  Circumstance presents opportunities for decisions, it does not dictate them.

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