Fives and coins?
Ever since we launched our own writing program, iA Writer, in October 2010, we’ve suddenly become both an agency and a producer. It’s a rare—and not entirely straightforward—combination. Guest commentary by Oliver Reichenstein, an information architect based in Tokyo.
It is fundamentally difficult to produce for yourself. Agencies have the distance needed to find the objectivity that the client lacks a priori. Those who work for themselves are fundamentally biased. An agency that produces is too critical of its own product. Criticism of the product is not perceived from a distance, but as direct criticism of the agency. This fuels fears that are not directly felt in client projects. After all, the success of the product also puts the agency's image at stake to a certain extent ("If they build such garbage for themselves, how bad will it be when they work for us?").
How do you deal with the problem of distance? You have to learn to listen to the end customer as if they were a service customer. Agencies know only too well that the customer is usually right. If you work for yourself, you have to learn to distance yourself from your customers and yourself. This is only possible if you separate the production team from the service department and manage the two separately. For this reason, we have set up a separate company for our product department.
And the customers?
We no longer have the typical agency ebb-tide cash flow that forces us to ingratiate ourselves as salespeople. We are allowed to do what we are paid to do; we can say what we think. Not every customer likes the fact that we are just as able to choose them as they are to choose us. This is particularly unpleasant in price negotiations. But:
- The fact that we are now in a position to select our customers gives both parties the certainty that we are a good match.
- Our prices are more realistic because we no longer have to lower the initial price in the hope of upselling due to the lack of competitive pressure.
- The fact that we do not have to make up for the unproductive time between projects gives the customer the security of not having to pay for it.
Sounds good, but...
iA's original recipe for success was to be generous with technical knowledge. This was both annoying and gratifying for the competition: the competition always knew everything we knew, but couldn't sell this knowledge on. Because more or less everything we knew was naked, on our website, for everyone to read.
Since we have our own product on the market, we have become stingy. The practical experience we have in the app business gives us a significant head start. For example:
- We know which online and offline factors sell an app better or worse.
- We know the bridges between the web and the app store.
- We have a knowledge advantage in interface design that is decisive in the war (iA Writer is the best-selling writing application in its category for a reason).
- Based on sales figure comparisons, we know exactly how much revenue can be generated with which app in which app store.
And we are now in a position to both keep this knowledge secret from our competitors and to sell it to customers as market-tested exclusive knowledge.
And the other side of the coin? While the practical experience and the reassurance of cash flow are generally good for an agency, from a business perspective we are perhaps sometimes a little too relaxed. We don't have a sales department. At the moment, everything sells itself. How smart that is in economically difficult times remains to be seen.
Conclusion
Do we recommend that other agencies take the step from service to service agency and producer? In terms of risk, there are more arguments against it than in favor of it, but if you have the right entrepreneurial spirit and the luck to go with it, you will enjoy your agency more than ever before.
