Pricing Creativity

Mike, a friend in the creative business recently wrote, “Remember, you get what you pay for. If production is thrown in for ‘free’ as a package deal with your media buy it really has no value. Not to mention the end result can and probably will damage your brand.”

Amen, brother! All too often agencies present themselves as creators of advertising when they’re really just great media buyers. I’ll agree that effective placement is critical, but what’s being placed is just as crucial. But maybe those agencies can’t be blamed for approaching sales and billing like they do; maybe they’ve retreated to throwing in concept and development for free because it’s easier to get clients to pay for something tangible, like placement, as opposed to the intangible… creativity.

It’s true we can’t speak for other service businesses, but in our opinion creative work—that is concept development, copy writing, design and production—is the hardest field in which to get paid fair value for your work.

For one thing, people assume creative work shouldn’t take all that long. Sometimes that’s true. Sometimes the perfect idea descends like a prophetic vision and appears on the page before you can blink. Other times, and more commonly so, the right idea takes lots of coercing and soothing to come out from the shadows.

Maybe it’s easier to understand as described in the advertising documentary Art & Copy, “The frightening and most difficult thing about being what somebody calls a creative person is that you have absolutely no idea where any of your thoughts come from really, and especially you don’t have any idea about where they’re going to come from tomorrow.”

Beyond that, we find people don’t want to pay for the value of creativity. More often than not, creativity is approached as a cost or an expense. The correct stance, though, is to view it as an investment. Instead of asking how much an advertisement or commercial will cost, the correct question is “How much will I profit from this?”

Obviously, no guarantees can really be offered, but the goal of our work is that it do something. If we only wanted to make pretty pictures for a living we’d be artists. Instead, we’re advertisers… artists with an agenda to raise awareness, to draw attention, to sell something.

The most difficult creative project to price is a very special one at that: the Logo.

At Emogen, we akin logo creation with childbirth… some are born peacefully and joyfully while others are welcomed only after long and painful laboring. The labor pains of that process include discussion about the business’s personality, the purpose of the logo, the audience, the intended use, the desired emotional response and on and on. And, depending on the project, that process is sometimes easy, sometimes difficult.

Ultimately a logo will be the “face” of the company, if you will. Though in spite of this level of significance, we find that logos are one of the most—if not the most—underrated purchases that a business will make. Amazingly, instead of asking about the creative process or beginning philosophical discussions about the emotion that should be generated by a logo, more often than not the first question asked is how much will it cost?

There are three approaches to answering that question. Some design firms will charge a flat fee (the same rate regardless of the project or client), others will charge by the hour, and others still will charge based on the value.

Emogen utilizes the third method, which is often frustrating to inexperienced clients. They want us to say $99.95, but instead we say it’ll be between X and Z, where X and Z vary depending on the circumstance.

Gasp, you say? Why does the price of a logo vary? So much is taken into consideration that there is no value meal price to be had. We consider how much the client is bringing to the table in terms of preconceived ideas and preferences. We consider how many decision makers will be in on the process. We consider who the client is, how large they are, and the frequency with which the logo will be used. We also consider the fair market value of logos.

According to the latest edition of the Graphic Artists Guild's Handbook for Pricing and Ethical Guidelines, logos nationwide are priced anywhere from $3,000 to $50,000. That window is broken down based on client size as follows: Small Client (which would apply to most businesses in our market), $3k-$5k; Medium Client, $10k-$25k; and Large Client, $25k to $50k.

Rarely are we afforded an opportunity to charge within these windows. Maybe that’s because logos are so common that they have the appearance of being a commodity. Maybe it’s because business owners fail to fully grasp the importance of their logo. Maybe it’s because business owners don’t have an appropriate frame of reference. Maybe it’s simply because of the great availability of freelance designers who don’t understand the magnitude and importance of the project.

Whatever the specific reason, pricing logos—or creativity in general—is an almost ridiculous feat. It is, hands down, the most difficult part of our business. But we suck it up and deal with it, one, because at the end of the day we are here to get paid; and, two, because we want, no, need the work as a creative outlet. Much like electricity, it has to be grounded… it has to have somewhere to go.

-Sarah Warren, Emogen marketer
w/ Jake Dugard, Emogen designer