Dan Mall worked at Big Spaceship and other agencies as an art director, in design and also strategy. He started his presentation talking about the rainbow fish, his daughter’s favourite book. The rainbow fish had pretty scales that it gave away to make friends but it was no longer as pretty, well Mall says that you’re the rainbow fish and don’t need to give your shiny scales away.
When his wife was pregnant they made the decision for him to work full-time and freelance on the side. This gave him the flexibility to experiment in his business, testing how to bill, what to charge, contracts and it goes on and on. He tests his hypothesis to see how it worked and felt before he’d commit to it. Mall believes in prototyping your business as much you would any piece of software and this is what he’s learned since starting Superfriendly.
Hourly Rates SUCK!
Getting paid by the hour sucks because they incentivize you to be slower.” Hourly rates don’t factor a person’s experience and agencies know it. They’ve built these considerations into their pricing. It’s why in 2008 Ad Age had a Director of Client Services hourly rate at $533, a Chief Creative Director at $964 and it goes on and on.
Mall says “clients shouldn’t pay for time, they should pay for our expertise.” Mall says there’s a disconnect between selling his experience and getting paid by the hour. At Superfriendly he’s transparent, he tracks everything and creates an annual report that tracks how many hours he works and the number of projects.
The good and bad of Fixed Pricing
Another way to get paid is using fixed pricing which puts a set monetary value on the project but not a set number of hours. It incentives you to work faster but the down side is it will penalize your hourly wage it takes longer to finish a project. It’s still flawed because you are getting paid for your time.
And the value is…
Then there’s value pricing where you are paid based on performance. One example used in advertising is if your ad leads to a certain outcome like a rise in sales you get paid based on that performance.
Mall finds value based pricing has “little to do with the project and more has to do with the service provider or the client” and incentives performance. Mall says “it’s really about the value of you at the time and what this means to the client. Here are two types of value pricing.
Is it worth an iPad or BMW
One form of value is object value pricing which works for students and smaller projects. Mall explains it like this “if your client offered you an object instead of money, take money out of the equation because it’s really hard to quantify a project what object would be worth it for the job.”
It tells you what the project is worth to you, if it is worth a used BMW that could be worth 20k. It gets harder to do as projects scale but for students it helps give them a sense of what a project is worth. It gets you to have that gut feeling about the project, Mall says to “touch your gut.”
Empowered through Cash Flow
What Mall did was figure out what he needs to earn a month which was $6900 per month so if he made $10k in one month that meant he was ahead in cash flow. So if he took a 2 week project he would need to make $5000 and by using round numbers he kept the math real simple.
In the first 2 months he made 10k each but in month 3 he was took a project that paid 30k. This would provide Mall with ultimate flexibility which means he’s not worried about getting paid because that 30K could cover him for 3 months.
This means that he has no fear, he can prototype and experiment because he’s covered, when you’re ahead in cash flow you are empowered because you know you’re covered for a specific time frame and can find or work on projects that you choose not just based on what they pay but what you want, hopefully it’s both.
When they Pay
You can do 50:50 which means that you will be working harder because you still have a lot of money on the line and the client knows it. The same thing applies if you do it in thirds. There was only one time where a client paid him in full for a 3 per cent discount. This allows you to hire contractors without fear of impacting your cash flow because managing your cash flow is about mitigating risk.
Dan’s Magic Questions
Here are some of the questions that Mall asks clients to get more insight into the projects that he’s been pitched.
1. Is your budget closer to 3,000, 50k or 300k? This question helps you to understand what the project worth to the client is because there are big differences in these ranges.
2. What kind of timeframe are we looking at? Mall found that this “question lights a fire under them.” (When you want large numbers to look small use K and when you want small numbers to look large use the full number.)
3. Is there any work already started I should know about? What this tells Mall is if they’ve had someone else on board that has done work on the project, and that he’ll have to trash or get past. It gives you an understanding of where the project’s been before they’ve offered it to you.
4. Who else are talking to about the business? Mall asks this because if he knows one of the others and they are someone he wants to work with it may be valuable to try pitching the business together instead of separately.
5. What team or people do you have working on the project on your end? This lets you know how important it is, if their entire marketing team is working on it, you know it’s important.
Mall’s contracts with clients avoid legalize like the plague, he used the Contract Killer as a basis and just adapted it, brought it to a lawyer and to make sure it was as simple to understand as possible.
Save the Date
Mall had to manage his time well and added a save the date clause to his contacts that stipulate a client that if they booked him to start in 6 months a retainer to ensure his availability. This was all about covering his ass because if the client reneged on the deal, it would be at the expense of work he could have taken.
A client more than anything wants to buy trust, they want your expertise to help them reach their goals. He’s learned these lessons by prototyping the most fundamental elements of his business to see what works and what doesn’t for Superfriendly.
Stacey MuLcahy (@bitchwhocodes) a Lead Dev at Big Spaceship came to FITC Toronto with a visual collage of sometimes crazy, hilarious and WTF inducing animated GIF’s. If I had time to share some of them I would but I was too busy trying get as much as I could down from her session as I could. For her second talk of the day at FITC Stacey dove right into the magic and misery that takes place when herding cats or managing teams.
When people think of a process they think of planning, design, development and launch. Stacey found that clients just want to know how you work. The “how” almost acts as a safety blanket for them, providing reassurance when internally at its best is controlled chaos and at its worst just chaos.
What she’s found in her work at Big Spaceship is that “process” can be more restricting than freeing. Stacey says that “when we talk about process we talk about it in very utopian terms.” At Big Spaceship she’s found that a framework is better, they act as basic guidelines, that maintain flexibility that can be lost in a more rigid process.
Working in teams require that you take care of each other, she says that “you don’t have to like them, but you do have to love them.” When you separate developers from designers and the strategy folks that’s a mistake.
“You never want to work with a developer who doesn’t want to have input.” The quickest way to fail is to put people into a corner, you want them to be engaged from beginning to end so their feedback is used to improve the project throughout it.
Competition on a team shouldn’t exist, it poisons the well. It prevents a team from really working together and leads to only seeing the “I” not the “we” of what the team is. Don’t hire assholes because you’ll spend time better put to the project dealing with them, so just don’t.
She wants you to avoid douchebaggery, in her words it means talking in plain English and not using big words in internal communication. Buzzwords are bad and not necessary internally. They can often obscure meaning instead of enhancing it. Don’t talk to Stacey about low hanging fruit either or whatever buzzword you hear, speak so people understand not so you look smart.
Of all parts of a project scoping one is her most hated, that’s because she doesn’t want to play “the magic numbers game.” Where you keep on going back and forth on what is possible instead of being transparent with each other so you know where you stand for the start.
If you’re scoping out a project make some basic assumptions of what you are going to do, and what you are not. Do your best to give clients this parameters, there are times when they want a ballpark number and their parameters provide that until the project is better defined in your discovery of the “what” in the project.
As a maker what she found is you can’t be meeting and making at the same time. For someone who is making, a meeting can ruin their workflow and when you have to have a meeting you better be damned sure you have an agenda and this with it or don’t waste their time.
Stacey deals with meetings is by blocking off time for them and her work. It’s about having respect for their time as they do for yours. You have to really be considerate of a maker’s schedule, so those meetings don’t become a time sink for those doing the making.
What is the definition of being done was the next target on her epic herding cats hit list and it has different meanings to different people on a team. Her example was that a designer isn’t done when she hands over the work, they own the visual design and should be there as it’s being done so it matches what they intended. Define what “done” means at the start of a project for those involved will keep the head banging to a minimum.
Have you ever done a post-mortem? Well Stacey says what we all think is that they are useless. Going over what worked and what didn’t really doesn’t help since the project is done. What she has done is hold weekly reviews so that everyone is on the same page and can help when it counts instead of when the project is long gone.
Build trust and transfer skills within your team by holding workshops can help those on your team and those within the company who just want to learn. Holding workshops takes more time but allows everyone the chance to get involved, learn and grow which can only help diffuse knowledge, instead of it being trapped within those evil silos.
Stacey’s last point of the talk was if all else fails you should dance like nobody’s watching. By that point I just think the GIF of a little dancing was just too good not to put on screen. Remember to take your team out for (not necessarily alcoholic) drinks, bowling or whatever to build trust (and get some valuable blackmail material for later use).
For every point, emotion and thought Stacey had dozens if not more animated GIF’s at the ready. Be it an angry panda, a dancing kid, too many cute cats to count, or one more relatable if awkward moment to go along with her wealth of insight and hilarity. If there is two things beyond the amazing session itself you can get is there is a GIF for everything, and that a presentation + GIF is that much more likely to be full of win.
The Art of Leadership Conference is coming to Toronto on June 5 in the south building of the Metro Toronto Convention Centre. Come and see 6 internationally renowned, bestselling authors and visionaries take the stage to share their insights leadership and innovation in today’s world.
I’ve attended one or two of the Art of Productions events (by volunteering or by sheer luck) and they are always filled with amazing speakers and a great audience from some of the most successful companies across Canada. They always give great networking opportunities at their events and a chance to get a question answered by your favourite speaker.
The lineup consists of the following leadership rock stars:
VIJAY GOVINDARAJAN on strategy and innovation
CHESTER ELTON on creating a culture of buy-in and belief
SUSAN CAIN on how to harness the strength of introverts
MARCUS BUCKINGHAM on strength based leadership
STEPHEN SHAPIRO on leading a culture of innovation
LEONARD BRODY on the myth of generations.
For tickets and more info on the line up check out the Art of here: http://www.theartof.com/leadership-toronto-2012
Here is the MISC promo code – RB22 – save $50 per single ticket or $100 per ticket for groups of 3 or more.
Finally follow this link to a PDF with more details on the event.
Thanks to Ron Bester of The Art of Productions for letting me know about the event.
So AndroidTO has taken its bow this year with standing room only at 99 Sudbury, the enthusiast and the developer gathered en mass to learn about the green Android. When the morning hit coffee and some amazing breakfast treats help to get people ready for the day’s learning ahead. Out of the two tracks of content being presented developer and professional, the former was the most busy with it being held in a much bigger space at the venue that was consistently filled to the brim. I will be getting into two of the sessions in the professional track that I saw while being a volunteer one by Andy Smith of Get Set Games called Now You’ve Got an App, What now? and Tackling the Challenge of the App presented by AppPromo.
It will be up by tomorrow because I am on my way to another event as we speak so I will see you on the other side.
Nick Parish, Contagious Magazine’s North American Editor will be talking at the Institute of Communication Agencies Engagement in the Social Entertainment Age event on May 10th. He will be talking about what some of the biggest brands are doing to engage consumers in new and creative ways. (more…)