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The Importance of Agency IP: Trends, Uses, Case Studies


in·tel·lec·tu·al prop·er·ty

Noun: A work or invention that is the result of creativity, such as a manuscript or a design,

to which one has rights and for which one may apply for a patent, copyright, trademark, etc.

So says, “the Google”.  Along with Merriam-Webster, & Wikipedia.

In the advertising world, however, intellectual property casts a much larger net and these days, in an industry where it can be easy for agencies to seem like a commodity,  everyone is after IP like it is the golden ticket.

Here are a few ways intellectual property makes its way into our world:

#1:  The work

Of course, ours is a business that relies on ideas.  Strategic ideas, creative ideas, ways to just get it done ideas.  This is the essence of what we do.  Unfortunately, it’s hard to trademark these ideas which means they can easily be taken.

While of course our work can be taken by other agencies or competitors, there has also been a long standing debate about how agencies should be compensated when in the review process for a potential Client.  Back in 2007, the advertising world was stunned when Doner openly agreed to the AutoZone’s contract regulations for agencies that were participating in the creative review process.  Such stipulations included  relinquishing the ability to pitch AutoZone competitors for two years and admonishing the right to all creative and strategic assets that were presented to the Client during the review process.  Other participants in the review process declined to comment on the terms and Doner eventually won creative responsibilities.

#2:  Expanding the business

More recently, agencies have expanded their skillsets so that they can create revenue streams through secondary business such as music labels.  In 2009, Publicis launched Publicis Entertainment, a branded entertainment division in order to connect marketers with entertainment properties.  At that time, branded entertainment was really taking off and had seen a 12% increase in revenue from the previous year, making it the perfect time for Publicis to join in on the action.

With the growing amount of technology these days, more and more agencies are also focusing on building technology products such as apps that are separate from Client work.  Many large agencies are even developing internal divisions and companies that focus solely on creating these products.  In early 2010, McCann Worldgroup announced their Split division which would focus primarily on  being an intellectual property incubator.

#3:  The unexpected

Chocolate, a fair trade café and shaving cream.  All things you’d expect to be created by an ad agency, right?  While it can be hard to quantify how much revenue is actually received by these agency off-shoots, the unexpected business lines seemed to be popping up everywhere a few years ago.

My personal favorite (just based on the name) would be Fat Pig chocolate, created by Brooklyn Brothers.  In a 2008 interview, Matt Lake (the agency’s new business director) made an interesting remark when asked about the agencies foray into being a retailer (they also created a Latin American coconut drink).  He stated, “But aside from the profit, marketing your own brands changes the conversation you have with clients. You’re no longer an agency trying to sell creative, you’re a peer that happens to be very creative. And you get paid too.”



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