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July 12, 2012
The Evolution of Influence: How Creative Firms Came to Power
 


Throughout the last century, creative people — notably writers and designers — have played an increasingly important role in the world of business. Their influence is greatest when a creative service is assumed to be essential to corporate success. With the access that influence provides comes the opportunity to shape corporate futures and to charge significant fees in the process.
 
Creative services, as we think of them today, began in the late 1700s when the first advertising agency, William Taylor, consolidated the placement of newspaper advertising in London. Previously, advertisers who wanted to reach a larger audience had to painstakingly reach out by mail, or later telegraph, to each individual newspaper in every town or city they wanted to reach. The agency provided the first way to inform a broad market about the benefits of products made possible by mass production. Sales increased, sellers benefited, advertising agencies prospered.
 
As the number of agencies grew, competition grew. To differentiate themselves and improve their ads, agencies began to offer writing and art services. J. Walter Thompson added the first creative department in the late 1800s. Agencies providing these services had influence with the corporate leaders of the day because they provided access to the fast growing middle class.
 
The next group of creative entrepreneurs to gain access and influence at the top were industrial designers who proved that a product that looked better would sell better. Industrial design pioneer Raymond Loewy advised heads of state, corporate boards, and the public on all matters of design. Loewy and his fellow industrial designers were perceived as the masters of consumer acceptance and taste.
 
After Loewy, specialists in packaging design and corporate identity emerged, and with them new opportunities to influence the “C” suite. Paul Rand and Lester Beall guided corporate thinking and spending through the design of logos, packages, and corporate identity systems. Designers offered new ways to influence company image in the public’s mind and proved that well designed products would sell themselves right from the shelf.
 
Another category of creative thinkers to achieve fame, fortune, and access were store designers. Rodney Fitch defined this discipline, working first for Terence Conran, and later his own firm.
 
Again, these pioneering methods of influencing corporate image and consumption gave creative people access to the “C” suite, power over how corporations spent their money, and significant fees in the process.
 
Enter Branding
Then came branding. Thanks to Walter Landor and his early “strategic design” methods, a new generation of creatives was invited to influence the “C” suite. The branding age went global in the 1980s as design firms wisely recognized the opportunity to get on board. Not only did brand designers get invited to the “C” suite, branding firms began to be desirable additions to global ad holding companies. Many acquisitions resulted. Branding had become an influential business. (Happily, our company was one of those who were acquired.)
 
As with the earlier examples, brand designers had secured a solid place at the “C” suite table.
 
Escaping Commoditization, Battling Procurement
In each case from advertising to brand design, once the guiding principles were widely practiced and insights understood, commoditization set in and responsibility for buying creative services was often given to lower level managers. Access to the “C” suite was limited, and no longer viewed as necessary, at least from the corporate point of view.
 
Since the 2008 downturn, procurement departments have become increasingly important to corporate health. As a result, corporate profits are up even as employment is down. Purchasing officers have successfully held down the costs of everything that corporations buy, including creative services. All of my clients are dealing with price pressure. The only ones who seem to be immune are experts in specialized niches. And even there, bargaining rules the day.
 
Welcome Innovation
The latest successful entry of creative thought to the “C” suite is innovation. Thanks to IDEO’s Tom Kelley and his bestseller, The Art of Innovation, creatives are once again commanding top fees if they can deliver a believable innovation offer. IDEO and their competitor Frog Design are leading this new wave of creative influence. But if history is any guide, there is room for more providers in innovation just as there were in advertising, branding, and product design in the past.
 
Corporations need creative teams to bring insights from outside. Corporations need creatives who understand how to meet people’s needs in the future. Corporations need the informed intuitions that creatives provide — more than ever. And they are willing to pay handsomely for them.
 
From uncovering as-yet unfulfilled needs, to discovering whole new categories of opportunity or inventing market-dominating brands, the record of creative service success is unprecedented.
 
The challenge, as it has always been, is to find opportunities that are right for our clients in the ever-changing marketplace. And, as always, we creatives must continue to help our clients understand how our informed insights will improve their image, their products and services, and their relationships with customers.
 
I still think Raymond Loewy said it best: “Never leave well enough alone.”

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Ted Leonhardt has provided management consulting and negotiation training exclusively to creative businesses since 2005. He cofounded the The Leonhardt Group, a brand design firm in 1985 and sold it in 1999. In 2001 and 2002 Ted served as Chief Creative Officer for Fitch Worldwide, out of London. In 2003 through early 2005 Ted was president of Anthem Worldwide, a brand packaging design group.     
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