What Business Are You In?

If you ask most creative business owners what business they are in, effectively they will tell you they are in the product delivery business.  Could be a floral arrangement, interior design, photograph, logo, dress or dance floor.  And once upon a time, you were.  Technology just was not there for it to be much more than a trust me game.  “You want twenty purple floral centerpieces?  Here are some pictures of some stuff I have done before, a sample of what one of the twenty will look like (even though it bears little resemblance to what the room will look like with twenty of them on the tables).  It will be fabulous, trust me.”  Just substitute your art for “purple floral centerpiece” and you get the idea.  The world does not look remotely like that today.  The ability to acquire, generate and present information is staggering.  I wrote about the importance of presentation in April and stand by it even more now.

The point of this post, however, is to go even further.  Every creative business I can think of has been transformed into an information management business first, product delivery business second.  Resist as you might, content will always be king, delivery his parliament.  I will only say that your life will be increasingly more difficult if you persist in making your creative business about the end product.  Those of you who wish not to be persuaded, okay.

For those of you who are open to a new world order, let us talk about what it could mean for your creative business.  With the focus on information acquisition, generation and delivery (to clients, employees, vendors and colleagues), we can imagine collaboration and value in a whole new light. But first we all have to agree that creation has huge price inelasticity.  Yes, I was an economics major so it rolls off of my tongue, but price inelasticity is an incredibly important concept for creative business.  It means that, at the margin, an increase in price will not change demand for your product/service.  A fantastic example is a Bentley automobile.  A Bentley Continental costs $189,000.  My guess is that if Bentley increased the price $25,000 not many buyers would say “whoa, whoa, whoa, way too expensive for me now, I am going to buy a Maybach”.  So my main premise for creative business is that the more creative, iconic the art and artistry, the more price insensitivity.  By focusing more and more on the creation, the idea, the information behind the art and less on the actual art, you will make your creative business more iconic, more creative. Only you can think like you do.  In short, by focusing on the idea first, the product as a happy side effect, you will be able to charge more, make more and sustain the margin longer.  The essence of you and your art has no competition.

So here you are as an information management business.  Surprise surprise, your work has to now be on the improvement of the acquisition, generation and delivery of information much more than it is on improving your actual product.  What does it mean?  It turns the typical vendor relationship on its head as much as it does turn your client relationship.  Rather than an antagonistic relationship (no matter how nicey nice on the surface) where the vendor has to deliver more for less, the premium is on information, ergo collaboration.  What if, instead of price, you chose your vendors based on the number of actionable ideas they provided you each month? What if, instead of taking or receiving commissions/discounts, you required a coop of sorts to pay for a graphic design firm so that you can present the ideas most effectively to your clients?  What if you hyper-specialized as the absolute expert in the delivery of, say, purple centerpieces?  What if you created a repository of information that heretofore has not existed.  Just a thought, but there is no TripAdvisor or Michelin Guide for creative businesses.  Directories do not count.  Vetted, relevant information for a specific audience does.

Watch this video about how Kiva Systems robots are revolutionizing how warehouses deliver products to you today.  What does it have to do with this post?  Amazon bought Kiva earlier this year because as soon as you hit “Place Order” Kiva robots are fulfilling your order two to four times faster than any human ever could.  Such is the speed and value of information flow.  For creative businesses, the opportunity is as big as Kiva and right in front of you.  My hope and vision is that you dare to make the leap.