Octagon Rooms

The Cost of Intellectual Property

Posted on: March 27th, 2017 by The Moderator 8 Comments

Welcome to The Octagon. We appreciate you taking time out to Join this Chat Session which will end in an hour. We have two moderators in the room who will only offer guidance where necessary. Please feel free to openly share your thoughts and experiences. Let’s begin with some introductions before going into the discussion. Can everyone let us know who they are and share a bit about what they do? 

 

Jude: I’m Jude. I work in Brand Development and Crisis Management. I also co-own a food company with my brother.

 

 Damola: I’m Damola, I recently started a role as head of business development for A2Creative, a brand development group and also the founder of a brand consulting firm.

 

Yomi: I’m Yomi, I work in brand development as a strategist/account planner. I’m also an entrepreneur and want to be president some day.

 

Isi: My name is Isi Etomi. I trained as an architect, now Creative Director of my own design studio focused on architecture, interior, graphic design and photography. Interesting thing about me…in the past, I’ve pretty much done everything from working in McDonalds, to selling car and home insurance, to door-to-door sales, to working in practice for a firm that restored/repaired/renovated stately homes and cathedrals/museums. I like to think of myself as an all-rounder.

 

Alex: I’m Alex. Digital marketing/Strategy. I also dabble into event planning when I’m not busy being a super hero.

 

The octagon: Nice to meet you all. Let’s jump into the conversation.

As a creative, you will eventually have to face a couple of unfortunate truths in your career in Nigeria. One of the most prevalent ones being a client who does not respect the work you do. A client that believes ideas shouldn’t be paid for, and only the execution of the idea is worth valuing. However, in other parts of the world, Ideation and strategy is a valid line item in billing clients.

Another challenge is the zero respect for intellectual property. There are clients who will take your idea and run. These days people show up to meetings and sign NDA’s before discussing. But are these NDA’s really effective?

The most unfortunate part of this unfortunate truth is that it will all too often present itself in the form of a client who refuses to pay for your services once all of the work has been completed.

Do you think clients should pay for Ideation ? How important do you think the idea is in a project cycle?

 

Jude: There is no question about it when it comes to the value of ideas in any project cycle. An Idea can be the WHAT, the HOW, the WHEN and the WHY of any project. Sometimes, it is all of these things. Ideas are solutions. Solutions end problems.

 

Isi: Clients who do not respect what creatives do can be found all over the world. Case in point: Trump not paying his architect’s fees. Humans by nature only want to pay for something tangible. We struggle to understand things we do not see. Which is suprising, considering how some of us have taken to the idea of religion – believing in a God we’ve never seen. But that’s an argument for another day.

NDA’s –  I don’t mind NDAs, but I think an initial consultation fee is required. IF they are happy to pay, then at the very least, there is value exchange. The idea, I think is 50% of the work. The rest is planning and execution. Ideas are pretty important. You can’t plan and execute ‘nothingness’. And creatives counter this today by tying their work to production, and building strategic partnerships

 

Alex: Ideas form the backbone on which planning and execution are done. You can’t plan what you have no idea about. Like Isi said, humans like to pay for tangible stuff which i think is where most of the problem lies.

 

Damola: I understand not executing nothingness but the reason why I agree that there must be compensation for ideation is that it has been a line item since I started in management consulting for these reasons;

1. I have seen instances when we send a proposal. The client may terminate the contract prematurely or might even be a prospect. They wait and slightly remix the execution. That’s theft.

2. If you also Bill for hours spent on ideation you realize you have resources committed and they have to be paid for.

3. The possibility of using your IP without credit. Hence need for IP lawyers.

 

The octagon: How do you decide what to charge for the idea? Should the possible tangible results be more emphasised during the cost process?

 

Isi: Only a creative can dictate what they feel their time is worth. Figure out your rates and don’t let anyone short-change you. Easier said than done though.

 

Damola: Man hours spent ideating and royalty potential for me. An example, if I had an idea for a platform. With clearly defined mechanics and earning potential. You would have to charge something since you’re basically giving a platform away with the blueprint with the possibility that you won’t earn a dime from it. if a platform can earn 40m by projections, I would charge 5-10% for ideation

 

Jude: Hours… Value Added to the project.

 

Yomi: So quick question if you don’t mind, how can you rate or charge for ideation given that it’s subjective? On the creatives end, it’s seen as 50% and one of the most important elements of a creative process so we would seek to charge a premium on same. However the client sees otherwise and would be VERY reluctant to pay for something he/she doesn’t value just as much. So how then do we bridge this gap?

 

Isi: The only way really, is to educate our clients – Which is one reason why I really love the Netflix show ABSTRACT: The Art of Design. It shows everyone what creatives do and how they do it. It’s sooo important that people see this. Many times in the hallways at school, everyone thought all architecture students did was ‘colouring in’ and ‘drawing lines’. Not understanding that every line and colour represents a decision.

 

Jude: This client education is difficult in Nigeria. I was on a consultation project for an Architect recently, and I had to stress the importance of building concept portfolios.

 

Damola: Have you had to educate the client and how ? Especially the ones who wouldn’t watch these shows or heed to videos or decks of educative material.

 

Yomi: There’s also the angle of clients who feel they ‘know and understand’ creativity especially as it pertains to their businesses even more than you the creative person. Educating that type of client would be a tough one.

 

Jude: When creativity is only based on a client’s brief, they feel they know better than you. But for those that create concept portfolios where ideas run free of limitation, clients seem to respect the extent of their ability even before going into a meeting with them. I’ve seen this happen time and time again, And I just had to take it on board.

 

Isi: We invite our clients to the studio and we have our work and process PLASTERED all over our walls. There’s also a short clip of like 101 logo revisions before the final. Things like that go a long way towards educating a client. Concept portfolios are good, but clients want to see BUILT WORK.

 

The octagon: In the case where the client needs to determine the best agency to move their vision forward and reaches out to multiple firms to pitch… how do you present and charge for ideas? There have been cases where ideas have been pinched and shared with the choice agency.

 

Isi: Only bid for work where you’re paid an honorarium. Unless you choose to do the work ‘on risk’ – Then it’s on you. The fact remains that there are people out there who will do the work for free. And they need to be educated as well. Newbies don’t know much – same as me when I first started freelancing as a designer. And they’re the ones the clients want to find and latch on to for work. I’m curious to know what they’re being taught at Yaba Tech and other graphic design/creative schools. Is there a business module ?

 

 Alex: I think as much as clients need to be educated, creatives need to be educated even more!

 

Damola: Yeah that’s what makes half our client pitches done on risk. I think there is a legal protection needed along with the education. Happy that IP law is a growing category that’s very much needed

 

The octagon: Here is a funny scenario: What happens when agencies who do not have good ideas begin to spring up because they know that initial ideas are typically paid for?

 

Isi: Competitions. In this scenario, people are being compensated for their time. Clients know that they have to search for talent. So they put out competitions, with an honorarium which suits their budget. Then maybe….everybody wins?

 

Damola: Yeah it’s also a tactic used by big FMCGs during their annual pitches. Especially as they take on the risk by inviting those agencies specifically, for the RFP requirements and resources needed.  BUT, I know of some consulting firms that send out RFPs, get proposals. Go quiet. And then eventually use the research done or execute themselves. I see RFPs like that I run. Or respond with a credentials document without giving away the meat of the idea

 

Alex: At the beginning, we spoke about NDAs. Why aren’t they effective anymore? Is it a Nigerian problem?

 

Isi: Some big companies know they have the money to fight, and we don’t. It’s as simple as David v. Goliath. ‘We have deep pockets’. Until someone teaches them a lesson

 

The octagon: What are different ways to protect your intellectual property from being used by a client without consent ?

 

Isi: Watermark, low res, Password protected files, Disable right click/save image as, Screenshots, etc. Even sending watermarked images ALONE will get you your money.

 

Jude: I knew a guy who created an app where he shared his work. The app security didn’t even let people screenshot its pages. I sometimes put clauses where some essential development is done outside of the client’s billable hours. On the surface it looks like a discount, but in reality I do some essential work I want protected during this time.

 

Damola: That’s dope!!

 

Isi: Do we know of any cases where a creative has taken a big company to court for using their IP without compensation or permission? But we too are responsible though, we should call them out when it happens. Instead of shrugging our shoulders and saying ‘it’s what they do’. Maybe we need to file class action? Find other people who’ve been screwed similarly.

 

Damola: No one oh. Just morning exercise. Haha. I’veheard of only a few, but it drains the creative outfit in the long run. Re: IP court case. It’s out of fear and the effort required but when we get bigger I think the larger agencies have a responsibility they are not taking on. They become YES men because their billables have made them fat and docile.

 

Jude: We don’t have a coherent creative industry. Too much noise from mediocre champions desperate to feed.

 

The Octagon: From each of your different experiences dealing with clients, how have you been able to ensure that you get the best out of your engagement? Can you paint a picture for us?

 

Jude: It has been a struggle. When I started out, I was based in the UK and the issues I faced were different. Now I find myself having to be extra selective about clients. I must vibe with you on a personal level before I do a job for you. If a potential client is an a-hole, I make sure I establish some grounds before we work together. Tame the beast before entering its den, so to speak.

 

Isi: If from the very beginning, I sense a client isn’t a good communicator, that’s the first sign of trouble…in my opinion.

 

Damola: Mine has been interesting both as an employee and a business owner. I worked with a big agency, it was easier to absorb the hits and fire clients that we weren’t interested in when they didn’t conform to our terms of engagement (smaller clients). With larger jobs we pitched for we took a risk and absorbed the hit.

As a business owner, I literally almost went on a dating expedition before I signed with the client before I engaged and even when I shared proposal. Always kept something before I got some kind of commitment (financial) to share more. In those cases the chemistry worked for the better for the engagement because of the trust.

 

Yomi: To be honest, I believe it’s about positioning yourself as not just being the ideas guy but also the execution guru as well. Creating a perception in the mind of the client of being as critical a factor to the execution of an idea as the idea itself has upped my chances in a lot of instances. (This however isn’t full proof).

The Octagon: Thank you for taking time out to share your insightful thoughts with us. We will be sharing this conversation on www.theoctagon.com.ng next week. We hope this has been exciting for you as it has been for us.

Alex: Thank you for having me!

Yomi: Same here! Have a swell day!

Isi: Thank you! This was a great conversation!

Jude: Thanks for having me. Thanks everyone.

Damola: Thanks! It was great discussing with you all

 

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8 Responses

  1. Isys says:

    Hmm, this is interesting, I think I need to read it a couple of times. But sorry, what are RFP’s? That went right over my head.

    • Damola says:

      Sorry just seeing this! RFP’s are Request for Proposals – so it could be done directly by the client, or on behalf of them by consultants.

      RFPs usually have extensive requirements, for information and set guidelines for the proposals and resource capacity of the agencies. They are usually done by Larger clients, who pay a pitch fee for man hours agencies spend in rigorously putting the information and ideation together.

      This is fair compensation especially when they are not awarded the job they are pitching for but spend time and resources preparing for it.

  2. Emil Garuba says:

    This was very informative. Thanks. I’m a content creator and screenwriter working within the Nigerian movie industry ans unfortunately most clients (producers, networks and media/production companies) hardly value intellectual property rights of the creators. Even when commissioning projects the creators are constantly disrespected and devalued. It’s a sad reality to deal with especially when your IP is stolen by the bigwigs and there’s no legal recompense. However, change is in the air — a screenwriter recently served an A-list celebrity with a court injunction over IP theft and I’m eagerly awaiting what comes next. We creatives really should speak out against such things when they happen or else we’ll continue to embolden the clients into thinking they can get way with disrespecting us, devaluing us, and down right shortchanging us when it comes to what we do.

  3. abobarin ayoade says:

    interesting read

  4. Rose says:

    These is worth reading but am not cleared about so some abbreviations. please what are NDAs & RFPs?

    • The Moderator says:

      A Non-disclosure agreement (NDA),is a legal contract between at least two parties that outlines confidential material, knowledge, or information that the parties wish to share with one another for certain purposes, but wish to restrict access to or by third parties. It is a contract through which the parties agree not to disclose information covered by the agreement.

      RFP is Request for Proposal. This is usually sent out to agencies and outlines what is required.

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