Thursday, September 1, 2011

Yet More about Crowdsourcing

Today I received a thoughtful comment on my original crowdsourcing post of 8/1 from Shopsanity, a start-up that famously crowdsourced its logo, only to find that the design had been stolen. The writer still seems to think crowdsourcing has its place, especially for small businesses that don't have $200,000.00 for branding (what ShopSanity thought it would cost). My response ran pretty long, so I am making the exchange this week's post. Read on:

Shopsanity said... The doctor example doesn't feel right. The "right" design for a business is an aesthetic choice made by the buyer and its customers, where the "right" diagnosis in medicine can often be a scientific certainty. 100 well trained designers might come out with similar, although still entirely unique, brand identities for the same client. That's the beauty of design and of any creative field - the creative possibilities in the final design are endless.

That's, unfortunately, also the draw of a design contest site to a small business owner. They're making an aesthetic choice in the end, and irrational as it may seem for the design community, sometimes aesthetic choices face the cold reality of financial capability. Quality correlates (imperfectly) to cost, and sometimes, small businesses are willing to degrade quality to get lower cost and a design isn't. That seems to be a fine choice on both sides - if I were an artist and could afford to only do what I considered to be worthwhile art, I would only do that. I wouldn't frown on the people who couldn't afford my choice.

I completely agree with @Rochelle above: "I believe that the design profession (and many others) is at great risk of becoming commodities. As such, it's incumbent upon all serious designers to provide services that justify the fees they charge. " "Quality" and "experience" are good selling points, but they don't solve the issues @Rochelle raises.

Finally, crowdsourcing is a great way for designers like the commenter above who lives near Joplin where the design firms shut down to get work when they don't otherwise have it. It seems like the design community could be supportive of those designers in that life situation while still selling the value of superior service they can provide.
@ Shopsanity – I appreciate your point of view. However, your diagnosis analogy reveals a misunderstanding of what designers sell to their clients. If it were simply a matter of aesthetics, picking out a logo design would be pretty similar to picking out a pair of shoes. Everyone is their own best judge of what they find attractive. But the most important service a designer provides is not aesthetics, but guidance through a strategic decision process that profoundly affects business success. A logo is first and foremost a tool that supports a company’s goals. Designers sell ideas. Aesthetics is a by-product. (See the post by Dave Bricker.)

What Logo Design Really Takes
Creating a logo requires research, analysis, concept generation and high-quality execution. A merely pretty logo, with little thought behind it, has none of this. The issue with crowdsourcing sites is not that they're low-priced, but that they pass their products off as equal to custom design created professionally. That is a much larger disservice to clients than it is to designers, because it is deceitful. At least designers can recognize the dishonesty - clients are far less able to see it. And since many logo mills sell their wares by implying that professional designers are rip-offs, it is no wonder that we take offense.

The Deception of Equal Value
When my client talked to the VP at the crowdsourcing site, he led her to believe that they were selling her something equal in value to what I had designed for her. She was able to understand my explanation because she has to contend with the same deception in her own profession. All professions are being commoditized and it is up to individual professionals to make their value case. I too am in total agreement with Rochelle. As I stated in my follow-up post, “I think that for designers, client education and marketing design [services] have to be synonymous . . . it also has to do with the disinclination of many designers to bother explaining their worth. We need to get over ourselves.”

Respect vs. Ranting
A lot of the noise about crowdsourcing design is unproductive ranting. Everyone has to make ends meet and get the most value for their money. In my small town, my clients are also friends and neighbors. They respect what I do, and I respect that their budgets are limited. We meet at the place where I can deliver work that adds value to their business for a price they can handle. Creativity is applied to finding solutions that meet their business goals as well as my goal of making a living.

Regarding Anonymous in Joplin, hers is a hard case. But I don’t think it will help her situation to sweat over design projects that have a high probability of no payment and being ripped off. Promoting the idea that working for free is a good thing for the worker is exploitative, as is cashing in on false promises of a pay-off. That and the deception of equal value is the true fallacy of crowdsourcing design.

Branding Is Not An Afterthought
On your blog you say, “… as a startup software company, investing in brand isn’t our priority.  Building software is.” So apparently you aren’t crowdsourcing your code, even though it would save you money. Viewing branding as less worthy of your investment sets up a false dichotomy. Which leg of a three-legged stool is the most important? If your branding is inferior, those perceptions will accrue to your product, no matter how great it is. Think it over.


  1. [Part 1 of 2]

    Thanks for the insightful response to our comment, Laurel!

    I think where we disagree is timing. I agree with essentially everything you and the rest of the design community has said about the value of great designers doing the work to build great identities - once a company is trying to scale.

    But that's not where companies start off. They start by jumping off a cliff and spending their own money out of their own savings accounts on the hope that they'll do something great. The restaurant down the street hopes the first people who come in eat a meal they like and tell their friends. The software company hopes they can build software that won't crash your computer. The dog food company hopes that dogs will eat their dog food. Most companies fail right there and never go any further. For those that do make it further, investing in an identity that delights customers is a great thing to do. But why would they do that before knowing if they're going to have any customers? Consider Google's first logo story from Wikipedia: "In 1998 Sergey Brin created a computerized version of the Google letters using the free graphics program GIMP. The exclamation mark was added, mimicking the Yahoo! logo." In 1999, when they knew their stuff worked, they invested more in identity and started to scale. This is our team's 5th software company, and we're among the fortunate because 3 previous companies scaled - but a 4th didn't. We don't know yet which this will be. Obviously, we're optimistic, or we wouldn't be doing the work of developing the software, but you can never know. We'd hate to spend money on identity before we know if anyone's ever going to see it - the money comes out of our own savings, after all.

    As you point out, we don't outsource our software. But that's because we're a software company. Software will attract the first 10,000 customers - if it doesn't, we're dead. If we get that far, we'll invest in identity development to help get the next 10,000,000. As an example, design is your business, and you probably don't have an in house IT team to manage a bunch of servers and backups. If you distinguish yourself with your design, and get headed to 10,000,000 global customers, you'll want your own IT department to configure everything based on your exact needs. But it doesn't make sense to invest in that now until you know you're headed to 10,000,000 because you're a design company and you need to get the customers, first and foremost, with your design work. We're a software company, and we'll distinguish ourselves first with software. We've heard the feedback that we need to invest now because early customers may not tolerate a changed identity - we love customers, and we'd hate to lose any, but the early customers will be 0.1% of the long term scale...

  2. [Part 2 of 2]

    A good read, and timely (just released this week, I think) is the Startup Genome Project report (summary: The project tracks thousands of startups to understand what mistakes they make. "Premature Scaling" is the #1 mistake leading to failure. For a software company, investing in identity before you know the software works is premature scaling. For a design agency, investing in an IT staff before you have lots of customers is also premature scaling.

    All the things you say about great design and great designers are true. At this stage of a software company, though, the stool isn't three legged. Crowdsourcing is one way to get something to see if we get far enough to invest more in identity. We could also go the Google route and just hack something on our own (which we've done for now). Will that mean we miss some early customers because they don't like our identity? Sure. But the point is we'll miss a lot more customers at this stage by building software that crashes your machine, so we invest so as to avoid that. Why not invest in both now? The money comes out of our own savings, and we sure would hate to invest in identity only to find we can't actually make the software do what we want it to do without crashing your machine. Just like most designers would hate to spend their own savings hiring someone to develop custom infrastructure software before they knew if anyone was going to buy their designs...

  3. HI John - Nothing I like better than an engaged commenter!

    I can well understand why you would be reluctant to spend serious money on branding for an untested product. Another reason to wait on a major branding investment is to see how the business evolves over its first phase and get a sense of how it plays in the market. But you’ll have a hard time getting that far if you start out with no initial identity that your prospects can recognize and associate with your company.

    So we’re still going to disagree about timing. Waiting to scale before branding, even on a limited level, is like saying you’re going to wait for treatment until a definitive cure is found. Neglecting branding at the beginning of a start-up could doom it to permanent obscurity. Even when you’re using your lunch money for working capital, you still need to give prospects a reason to bite. Often there is nothing more to go on than your branding and what it says about your product; without that, people have no basis for making a purchasing when there is no track record. Your analogy of a restaurant hoping people that come in will tell their friends doesn’t answer the question of what gets those people in the door in the first place. This is starting at Square 2.

    The primary function of branding is to create trust and recognition in customers. That process has to start somewhere – it doesn’t occur in a vacuum. “. . . investing in an identity that delights customers is a great thing to do. But why would they do that before knowing if they're going to have any customers?” This may seem like a chicken-and-egg conundrum, but it’s not. The ball is in the start-up’s court. That is where the conversation starts - it is not customers’ responsibility to somehow magically know what your business is about and why they should care. As for the Google example, I think they succeeded in spite of their branding approach, not because of it. Google’s experience is an exception. It is doubtful whether they could get away with that approach in today’s pervasive hyper-consciousness about branding.
    (More below)

  4. "'Premature Scaling' is the #1 mistake leading to failure. For a software company, investing in identity before you know the software works is premature scaling. For a design agency, investing in an IT staff before you have lots of customers is also premature scaling."

    As a small business, I don't invest in a product before I perceive a need. I DO invest in things that I can foresee needing and where I can also foresee failure if I don’t. You will not distinguish your software until you a) get your market’s attention and b) get them to try it. That’s why you need initial branding. And I would suggest that the #2 mistake is not properly promoting the new offering sufficiently or clearly.

    "Crowdsourcing is one way to get something to see if we get far enough to invest more in identity." Except when it blows up on you, as it did with the ShopSanity logo. You have stated that you have no guarantee that a freelancer won’t sell you stolen material either, but a 100% guarantee only comes with an exhaustive trademark search (expensive and lengthy), no matter what source provides the design. The way you vet freelancers is by viewing portfolios, checking references and interviewing. This has worked well for decades for the vast majority of businesses.

    “. . . we'll miss a lot more customers at this stage by building software that crashes your machine, so we invest so as to avoid that. Why not invest in both now? The money comes out of our own savings, and we sure would hate to invest in identity only to find we can't actually make the software do what we want it to do . . .” It’s not an either/or thing – that is a false dichotomy. You need initial branding to support the success of the product, and it doesn’t have to be expensive. Branding and marketing won’t save a bad product – it will actually make the poor quality apparent faster. But it WILL support a good product, and in the initial phases of a launch, that can spell the difference between success and failure.

  5. @Laurel, a thoughtful series of posts and responses. Much respect for the way you handled it.

    @ShopSanity, by your logic, if one can't afford a $3,000 suit, one should walk into a business meeting wearing sweatpants and a t-shirt bought at Walmart. A suit from Walmart might might cover your nudity, but it probably won't fit well, the fabric will be cheap, and you might split a seem when you bend over. Is that the way to make a good impression? Is that the way to get new clients or customers?

    Sometimes you have to spend money to make money. Or to start a business. Do you have a contest for your legal advice?

    Any business that is started based on "hope" of success instead of a solid understanding of their market and acquisition of necessary materials is a coin flip away from failure. If a restaurant looks like they are a dirty dive, how many people will actually even try the food?

    For most smart businesses, image matters. It's the beginning of brand. Brand is that gut feeling people have about your business. A perception. You can't put that on hold.

    Appearances matter. We make judgements on them. When the appearance reflects reality and provides differentiation, that's when it works best.

    There is lots of room for middle ground. You can get affordable design without 99% of the designers working for free. It's sad that contest participants (some of whom are software monkeys, some of whom are decorators, some of whom are designers, in the US and elsewhere) are so desperate. No, no one is forcing them, and long live capitalism, blah blah blah. There are alternatives. (And I've got some advice for Anon in Joplin but I'll post that on the other entry.)

    The race to the bottom is one that a lot of professional designers choose not to participate in. And if anything, I thought Laurel's price was too low.

    Best regards...

  6. Maybe it is just me, but it seems, after reading the back and forth between shopSanity and Laurel - I wonder if shopSanity is not JUST thinking of a logo design when talking about branding, whereas Laurel is obviously talking about branding as a whole (far more than JUST a logo)? Because, as Laurel says, the branding is not just the aesthetic, but what your company is saying as a whole. It is not only the way things are designed, but also the mannerism, the copywriting, etc. It is not just the way the marketing appears, but also the way it is presented, the places it is presented and made in a way to get a very specific perception, or reaction, from the customer.
    So, like Anne says above with the Walmart suit example (which is always a great example, by the way), it isn't even necessarily that the suit might rip, but it is the perception that the person didn't really care how they are perceived. If they can only be bothered with running down to the big box discount store and get the first thing, then they will be perceived as rushed or flippant or a number of other negative things.
    Just my thoughts. Good articles and comments all around.

  7. It seems to me that being entrepreneurial in the software industry means relying on the tech bubble business model and hoping for the best.

    I had quite a few friends who jumped into designing software full-time with no pay instead of doing it on the side while employed at another job. They bankrupted themselves and their families waiting for that big investor who never came. Not a way to live, in this designer's opinion, unless you crave adrenaline and let downs.

    One aspect of the software AND hardware business, and a point that ShopSanity DOES make well, is that the logo and branding for anything other than the leading products are not really noticed. How many times have you gotten an electronics product or plugin with a really crappy logo (video cards!)? But you use it because it was a good price and/or it happens to be industry standard.

    The thing mentioned here that resonates with me is: If you don't think you need it, why buy branding at all? Why not just sell your product by its merits and your expertise? Network where your competitors do. Why ask professional people with educations and experience to work for little or no money?

    There are lots of small businesses that are doing fine with word of mouth. You will know when it is time to class up your image, positioning, mission.

  8. @Chris – Thanks for commenting! Yes, there is a lot more to branding than a logo. I wrote about that in this month’s DesignDeli newsletter: The attributes you mention contribute to the overall impression a potential customer has of a business, and there are many others. All aspects of a business position it in the minds of its customers, for better or for worse. A good example of worse is the sweatpants analogy. If all the customer knows about you is that you didn’t care enough to dress properly, they will reasonably assume (having no evidence to the contrary) that your product is equally sloppy. Of course, this is not a conscious process – it occurs in the unconscious as a feeling of unease or discomfort, making it hard to identify and correct. That is why it is vitally important to control your brand from the beginning. If you give it no attention or form, your market will fill that void with whatever they assume and you will have to deal with it.
    @Dot – Sorry, I can’t agree with you on either of your points (although I do appreciate your commenting).

    1) To be effective, branding has to be consistent. Falling down on the secondary products sends a message that they are not important or valuable. They are noticed just as much as any other parts of the product line, especially if they are out of sync with the production level of the primary product. People notice everything unconsciously. Conscious perception is just the tip of the iceberg, and you ignore it at your peril (see above).

    2) One of the most common fallacies about marketing is often found in the marketing section of a start-up’s business plan: “We will rely on word of mouth.” WOM of mouth doesn’t magically materialize when a business hangs out its shingle, whether it’s a tech business or the new Mom & Pop on the corner. WOM has to be GENERATED. Expecting a product to live or die on its merits alone is like telling a kid who just graduated high school that he has to move out and make it on his own. It may happen, but if it does it will be largely a matter of luck. Like teenagers, products need more support than that. The original purpose of branding was so cowboys could tell which cows were theirs in the corral. The point of business branding is to help a company stand out enough in the marketplace so it can be recognized, remembered and found when the customer has finally made a purchasing decision. It is true that many small businesses are doing just fine with WOM, but it’s because they put some effort into generating it. I know – I work for a lot of them.