The Blog

Profiting in the Idea Economy

What the NEA and Pepsi experiments have in common is that as they tap into the rich vein of collective creativity in the digital culture, and threaten long-standing business principles.
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Last Friday, the deadline closed for entries into the National Endowment for the Arts logo contest. The controversial call-for-entries raised important issues for the creative economy, the biggest question being the value of creative work.

We live in a time of unprecedented creative output. Much of it is facilitated by the Internet and mobile technologies. Take Facebook, for instance. A vast digital canvas for creative expression, Facebook now has a population equal to the fourth largest country in the world.

Recently, Pepsi's bold "Refresh Project" shattered marketing records when it offered grants from its charitable coffers to young leaders for their altruistic community-building projects. AdAge magazine hailed it as a "pivotal test case for other brands." This suggests the seeding of a marketing trend.

What both the NEA and Pepsi experiments have in common is that as they tap into the rich vein of collective creativity in the digital culture. They threaten long-standing business principles among professional creatives. In the case of the NEA, it has invited applicants to submit their logo designs on a "speculative" basis. Translation--you will not be paid for your work unless you happen to win. The winner walks home with $25K.

Is this crowdsourcing? Collaboration on a grand scale? Or is it cheaped out spec work, the bain of the creative economy? To get some answers I turned to designer Patric King, lead partner at Chicago-based House of Pretty, a cutting-edge visual design firm whose clients include Wired magazine and He explained that spec work is rare for serious designers. "I think I've done it twice in my career." He explained, "It's got to be a perfect storm of satisfying work and good publicity, and I can pull off the bid without a dangerous amount of investment."

In Pepsi's case, the question raised is this: who owns the applicant's ideas? The fine print of the online application says Pepsi does. Idea theft and intellectual property rights are sticky wickets. On the one hand, Pepsi's brave blend of cause-marketing and social media will inspire innovation in corporate philanthropy. That's a good thing. On the other hand, does a socially savvy brand want to be associated with abusing the creativity of its constituents? Is this a simple matter of crowdsourcing, or is it gussied up idea theft?

Last year at this time, I met with Chris Anderson, editor at Wired magazine, who was promoting his recent book, "Free: The Future of a Radical Price." In it, Anderson attempted to make sense of the emerging economy in which lots of people will try to make money by giving things away. I witnessed first hand the push back he got. People grappling with how to forge profitable businesses in this economy are rightly fearful of how far "free" will take them.

Still, hordes apply for contests where they give away their creative work. Pepsi was overwhelmed by applications. The NEA had to post a lengthy FAQ to handle the influx of questions from upstart designers looking to make a name for themselves.

Meanwhile, the professionals in the creative economy watch and wonder. They see the very essence of their work--the conjuring of creative ideas to solve business problems--being devalued. And they wonder, as I do, how these speculative experiments will impact their livelihoods. As Debbie Millman, principal at Sterling Brands, a New York based designing consultancy, put it: "The design profession has a long-standing prohibition on speculative work because it compromises the interests of the client." Millman quipped, "No one would consider asking a plumber to work on spec. Why should a designer?"

Beyond the practical matter of making a living, the "will work for notoriety" debate stirs a philosophical rift among creatives. Those who oppose crowdsourced art and design can seem like protectionist bulwarks. Yet, the over 300,000 professional designers in America are some of the most open-minded, inventive people in business. And standing in the way of progress is, well, uncool.

So, like many other business people, professional creatives are watching and wondering when a sustainable business model for mass creativity will hatch in the Petri dish of this emerging economy. Stay tuned.