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Eco Luxury: Not to Scale, Yet

My big advice to Nau 2.0: Charge more for your clothes. And start as small as you can.

A few months ago, I wrote a post on the rise of Indie and Eco Luxury, and one of the hero companies of Eco Luxury that I mentioned was Nau. They were one of the first attempts at creating a luxury brand that forcefully marketed ecological, sustainable, and stylish clothing through online and direct retail stores.

Sadly, due to a lack of venture capital funding Nau was forced to shut their retail stores and sell off all of their stock at a discount. There's been much talk in the blogosphere about what killed Nau v1.0:

Their unusual, I mean novel, retail model. Nau stores generally carried one size of each style and encouraged store visitors to have their purchases shipped to their home instead of buying them in the store. Critics have noted that many luxury fashion purchases are often made on whim, and the inability to easily carry a purchase out could have been a negative for the buying experience. (I personally didn't care when I had made an purchase there, but then again, I'm not really a luxury shopper.)

Their all-Flash Web site. Nau.com, as much as I love it from a branding perspective, was not created in a manner that made it easy to shop and had weak user experience. When the brand launched, some of my designer friends had hammered on the site design as an example of design trumping usability, which is definitely a bad place to be for a design-oriented brand that focuses on function and form.

Their oversized ambition regarding audience demand. Nau's business plan hinged on continued rounds of investor financing to ensure their continued growth into more retail locations. This is what really spiked Nau's ambition, when you boil all of this down. Instead of fostering an audience through their Web site and then growing that online audience into local retail, where demand had been generated, Nau was looking to expand into new locations even as they were discussing shutting their doors. My neighborhood of Fremont in Seattle was the destination for one of those new locations.

I find it fascinating that a company that wanted to live, eat, sleep, and breathe sustainability in clothing production, distribution, and sales practices didn't launch their business by only selling through the Internet, or intentionally limit their market by starting very exclusive before mass-producing their line and attempting to go big retail. Millions of dollars were wasted in proving that without a strong online customer base, a compelling retail experience in a few upscale markets isn't quite enough to keep the doors open.

Had Nau offered a smaller product line that was made to order and was perhaps more exclusive in both price point and retail placement, my gut tells me that they would have organically created a group of loyalists that would have evangelized the brand when they dove into the mainstream retail market as their own storefront.

Small pioneering eco-luxury brands such as Mink Shoes took about as long as Nau's lifespan to get off the ground, and still haven't achieved any major economies of scale. But they're profitable, and resell through many top retailers. A recent article in Fast Company echoes similar sentiment regarding the need to find sustainability through selling small quantities of green products in the luxury market. You won't see Barney's selling 2,000 of the same pair of eco-friendly shoes. Eco Luxury has a long, long way to go if it's going to scale to the mainstream in any meaningful way.

Hindsight is 20/20 here. And luckily, Horny Toad has swooped in and purchased the Nau brand and legacy, along with much of the original staff, to give it another go. Here's hoping that with this new financial backer, Nau 2.0 will be able to create a sustainable business practice through actual clothing sales that matches the deep philosophical roots that underpin their products.

So, back to what I said at the start of all this...

Okay, Nau 2.0: Now that thousands of your loyal customers have jumped up and down and told you how much we want you to stick around, I don't think we'll mind paying a little more for your clothes -- especially if that will allow you to continue donating 5% of each purchase to charity.

If you're going to try and keep the luxury mantle on your products and your philosophy untouched, that's one of the few ways to keep an edge on the dozens of other fashion brands that are now rolling out eco-friendly lines alongside their usual unsustainable practices.

And we'll forgive you for the missteps along the way... just be sure to be a little smarter about what you're doing this time.

Designers Hate Estimating, Pt. 3 of 3

In Pt. 1 and Pt. 2 of this series, I shared some of the common variables that designers should take into account to reduce their "cone of uncertainty" when estimating a project.

In this final post, I want to talk about the things that designers often don't quantify when creating an estimate.

Factor: What the client needs, as opposed to what they articulate they need. The client wants a new logo, but that's not the business problem that comes out in your exploratory call or meeting. If you need to reframe the problem for them as part of the process, you need to consider it as a variable and secure more time and money to do that work. The way I couch this to clients is that designers aren't just problem solvers. They also have talents in helping clients to understand their problems, clearly define them, and then solve them. This is our strategic role beyond providing decorative assets.

Factor: How the client will behave through the course of a project, and if that will influence your work. Clients ask designers for references, but it's not always a bad thing to check up on your clients and/or closely observe how they interact with their peers or other vendors. This kind of gut check should govern what kind of buffer or multiplier you apply to your project fee, or whether you wish to engage with them at all. Sometimes you need to say no gracefully.

Factor: Not budgeting for potential failures through the design process. Why do we budget for exactly how long it will take? There should always be contingencies for at least one point of failure. Assume that at least one thing will go wrong, and be prepared for it in advance of it happening.

Factor: Not having an articulated business process that fits another designer. Let's say you're indisposed and you need to pass off your project to another designer. Many designers make the fatal mistake of estimating it to a person as opposed to a role. Don't just say, "It'll take me twenty hours to design this logo." Think about how long would it take any designer to design that logo. Leave room, should you get too busy or need to hire a freelancer, that the project can be covered without losing your shirt on the estimate. This may sound like heresy to some solo-flight designers, but this is what keeps large agencies alive.

Factor: You've never done a specific deliverable before. If a project is outside your realm of expertise, most designers usually assume they'll eat the cost of learning how to do it. This opens up risk from the client's perspective, and also gives them a point of negotiation to have you burn up hours meeting impossible goals. Do your due diligence and consult with one or two colleagues and ask them for advice on how to bid the project. Don't just give it away if you haven't done it before, or let the client know you can be taken advantage of because you're not an expert regarding this one type of deliverable. You should always continue to control the process of the project, follow your established design methods as they apply to the deliverable, and not allow the situation to become a power play.

Designers Hate Estimating, Pt. 2 of 3

In Pt. 1 of this series, I introduced Construx's "cone of uncertainty" and how to narrow the risk in your estimates by determining what unknown variables exist in your project scope.

Let's work through what these variables usually are, and how they can be brought in line in your estimate.

Define the Problem before You Estimate

In your estimate, what you need to demonstrate most is your understanding of the problem. Your approach to how it should be solved would follow, and should always be consistent. As a quick example, let's think through the variables that exist in creating a new logo for a local business.

Many years ago, I would estimate doing a logo by looking back through previous project to see how long it took for a project of a similar type, bash together an estimate based on how long they think it would take, multiply it by 1.3x to give some cushion for contingency, slot in some money for printing costs if they need to create any supporting materials as part of their bid, and send it off to the client.

Today, I focus more closely on what the client needs before I think about how I'm going to create it -- even if I've done a similar type of project for them before. And I charge my client for this extra time spent on the estimate as part of my overhead and creative fee, because they're getting more than just a cost for creating a logo.

Let me try to break it down here.

There's data from your prospective or current client, relating to specific needs out of the project (looking for brand lift, increase in perception, greater sales, etc.), as well as competitive analysis and market research.

There's qualitative information that your client provides in the way of what customers and staffers think about the old logo, which adds up to an impression of why they need a new one. These elements shape up into a business problem, which must then meet your process.

This information can usually be teased out in a single phone call, with some follow-up via email. I recommend making a set of questions you always ask in the exploratory call and keeping them by your phone in case you're surprised by an opportunity.

Have a Consistent Process for Creating the Solution

Within that same exploratory phone call, you should delineate what standard steps the client would take through the project, and what they are given with regard to rounds of review per each deliverable as part of the scope of work. Get that on the table from your very first conversation, so they're aware that they will follow your working process, not vice-versa.

It should go without saying that all of your rounds of review and costs for work outside the scope of the proposal must be in writing to protect your interests. I also recommend providing an hourly estimate of your work for a project, not a flat fee. There is always risk in accepting a flat fee, as it places the onus on you for understanding all the ways a project could go sideways and accounting for them.

There's qualitative information that you control in forming your estimate, such as what kind of creative approach you think you'd take -- but I'd recommend articulating that in your creative brief. I wouldn't recommend writing the brief before getting a signature and a portion of your fee, but I generally have a glimmer of an idea of what approach I'd likely take. This thinking can sometimes provide some color in the estimate, but should never be doled out for free and can sometime be shared anecdotally if the client is looking for a detail to tip the scale in their choice of a designer.

In Part 3 of this series, we'll explore some of the incidental details that many designers overlook when estimating a new project.

Designers Hate Estimating, Pt. 1 of 3

Have you ever met a designer that likes to create time estimates for projects?

The process is fraught with peril no matter how you approach it. Estimate too many hours, the client balks at the price and you need to negotiate to a resolution. Estimate too few hours, the client gladly signs on the dotted line, and you end up taking it in the gut. Hit it bang on the nose once in a blue moon, and take yourself out for a double-tall latte to celebrate, before walking back to the office and rebalancing your books.

Well, I could alleviate some of your estimating stress by telling you that there is no perfect estimate...

...and then raise your blood pressure by venturing that your estimate could deviate as much as four times from your original figures, depending on the scale of the engagement. That is, if you don't properly define what you're delivering, and assess the risks appropriately.

Get out of the "Cone of Uncertainty"

For a quick lesson in estimation, take a page from the software development playbook, which doesn't really differ too much from the large-scale interactive estimation process -- and can be scaled down to apply to most design estimates.

Construx, a well-known software development consultancy here in the Seattle area, has an article on their Web site regarding the "cone of uncertainty" that's essential reading for any designer who is responsible for managing large-scale design engagements.

The "cone of uncertainty" is the zone in any project where a number of interrelated variables -- the details of the work to be done, your process of doing the work, who will be creating the work, etc. -- have not been defined. Any methods of reducing uncertainty can limit "scope creep" (or just plain "lack of scope"), and also create further clarity with your client over shared expectations for the life of the project.

The only way to escape from this scenario is to put all your information out on the table and determine what you don't know -- and get the answers -- before delivering your estimate. That'll be the subject of Part 2.

The Three Fundamentals of Creative Strategy, Pt. 6

Read Part 1, Part 2, Part 3, Part 4, Part 5.

Now that we've worked through some of the key approaches to formulating business, marketing, and tactical strategies for your clients -- and how those form the frame around your creative strategy -- I thought it would be valuable to include a few points about how to distill your marketing insights into compelling creative communications.

Think outside the box, but inside the strategy.

As a designer, there's nothing I love more than launching into space after reading a creative brief, brainstorming solutions for the client's needs. But that brainstorm should never go off into deep space, never to return. I know it's bad etiquette to edit during brainstorms, so I try to let every idea have its due... at first. But when you're culling those ideas down to what will become solid concepts to put in front of the client, you have to be ruthless. Anything that doesn't fit the strategy and the key insight the client approved in the brief, or modifies that insight into something completely fresh and new, needs to be placed in the parking lot and saved for future use. (Unless your brief was wrong in the first place, which means you should back up a few paces and make sure you landed the right insight to back up your creative work.)

Firmly fix your concepts on a properly told story.

You know they want your vacuum cleaner because it has a sexy design, it lives at a slightly lower price point than the competition, and the HEPA filter makes it easy to clean up dog hair. Yawn. Don't tell me the details. Show me how it's going to change my life. Find a story that communicates this seed feeling to me. Then hammer on it mercilessly. Again, if you don't have a story that matches your key insight, you need to step back and rethink where you're at.

Don't move away from a key insight or position too quickly. You might piss off your clients and your audience.

As you develop creative concepts in a series, don't be too hasty to bring in something new. There's a major piss-off factor that happens when you iterate insights about your brand too quickly. It usually just means that you landed on the wrong insight, which is a kind of weakness that consumers can smell on the wind.

You won't lose a client because your key insight over a year or two doesn't continue to hold. Audience behavior shifts over time, based on a number of factors that corporations and designers can't easily control. But you will lose a client straight out of the gate if your key insight fails to hold up. It means that the foundations of your house were faulty to begin with, and somewhere along the way, due diligence wasn't exercised. So be sure that if you are going to make a client recommendation, the tires have been kicked enough times that you don't have to fear running out of air as you pull onto the highway.

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Now that you understand your client's business logic, their overall marketing needs, and what tactics you're going to employ based on your audience behavior, you're ready to create properly positioned creative concepts. At this point, it may seem like your work is going to be bulletproof, but we're only halfway home. You've got to execute an effective piece of marketing communications! Thankfully, that's the lion's share of what we get paid for, and in many ways, what we'll always need to do best to retain our clients.

The Three Fundamentals of Creative Strategy, Pt. 4

Read Part 1, Part 2, and Part 3.

Great creative strategy always starts with a clear articulation of a business problem, and a rational strategy for solving it. This is the outer layer of the onion that peels away to expose a marketing strategy. In this post, I'm going to detail the key questions that comprise the guts of a high-level marketing strategy and the seeds of both your creative strategy and marketing tactics.

Marketing Strategy at a Glance

Based on our business needs, what actions should we take in the market to better sell our products or services? From the corporation's point of view, this often boils down to bottom-line impact, moving the needle by a point or two. For designers, this business need must be clothed in a human insight to have any lasting effect on the market.

When embarking on a marketing plan, the following questions need to be addressed and always in this order. Otherwise, you're throwing tactics at the wall like spaghetti.

1. What does the audience want to hear from this company? Is what the company wants also what the audience wants? Before you can propose a strategy, you need to know that the audience is receptive to such messaging. And if they aren't, you need to come back to the client with solid research to indicate the direction they should take.

2. Where does the audience want to hear it? Where does the audience live, breathe, and communicate? Where they live, work, and seek distraction, as well as online destinations where they congregate -- and how much time they spend in those different locations -- are all fair game.

3. What customer problem does this approach solve? Where's the real customer pain you're addressing? If you're creating a pain and then solving it for a customer, then you're going to have a harder row than stepping into your audience's view with something fresh that fulfills a tangible need.

It's important to note that these questions are the core of both your marketing plan and your creative brief. And often all the answers can be found through informal research.

The Importance of (In)Formal Behavioral Research

The questions above can be answered in a number of ways, but most often it requires some level of research. And by research, I'm not talking about 50,000 surveys and heavy focus groups over a period of months around the United States. I'm describing observing your audience in their domain, either through spending some time where they congregate, or doing some anthropology by easing your way into their work environment to gauge how things appear from their point of view. This can be accomplished by engaging with a formal research partner, but in the case of most projects, there isn't time or budget to do so.

So, in lieu of hiring a professional, I do the following.

Spend time in retail environments with the customers. I go out to stores where my client's products are sold and watch every little detail: how people make choices between multiple products, what they may say aloud, whether they interact with salespeople and the quality of their interactions. Designers nowadays are asked to address the overall experience of engaging with a brand, and the sum of these interactions can often give an indication for why people aren't acting in a manner that the corporation would like. The audience is always in control. My rule of thumb is that if I see a behavior repeated 4 to 5 times across multiple stores, it's probably an indication of a much larger concern -- especially if those behaviors are happening across multiple geographies.

Spend time watching how your customers behave online, and if they complain about their on- and off-line experiences. If you can get metrics from your client, combine them with how customers are reacting on wikis, blogs, forums, Facebook, and Twitter. Marry up trends in your Web site statistics, such as fall-off in transactional processes, with real quotes about actual problems that can be solved. Treat every complaint like gold from heaven. If your customers aren't complaining, they probably aren't giving you strong insights.

Do a task analysis. Task analysis allows you to step into the environment of your key audience members and observe how their specific needs can be fulfilled by a the features of a product or service. Ideally, you'd work this kind of research into your agency fee, and a task analysis can help bolster and refine your general behavioral research while also contributing to the development of, say, a complex Web system.

Listen very closely to the client's point of view about their audience. I always read the client's provided research and mine it for insight before going into the world to validate. Even if your client provides you with all the answers, I think it's our responsibility to see if there are any areas in the margin that we can scribble in a little more insight. Designers are intuitive thinkers that can sense the emotional undercurrent of a person's dialogue about, say, a bar of soap. Teasing out those details provide the shape of how our audience is behaving at this moment in time, and what they expect out of any kind of corporate communication. Sometimes your audience is moving so quickly that how they felt six months ago isn't an accurate snapshot of where they are now -- and where they are headed tomorrow.

The following is a gut check that I always apply at the end of research.

See what can and can't be controlled in the sales process. Ever been asked to sell more product when the product really isn't very good, or when you can't control the customer's experience in the store? When doing research, you need to be aware of what you can actually accomplish. You may need to share with the client that their goals are unreasonable, and propose a sturdier, more realistic course of action.

Until They Pay, Keep Your Research Close to Your Chest

Keep in mind that working through this kind of research, especially before you've been paid a fee, is something that you should parcel out to the client very carefully. Depending on the scale of the project, this kind of research and analysis can take a good number of days, and time is money for any design professional.

I recommend that you determine the depth of your research in advance of agreeing to respond to the client proposal or request, and try to keep it to a budget. When I aim for a major piece of business, I dive hard into the research and try to come up with a strong insight before determining any course of action. If the project is at a much smaller scale, those insights may have to wait until they've signed the work order and we've started in on the creative brief.

Once you've collected this information, and you have distilled it into the key themes or trends that indicate a strong support to the business problem, you're ready to talk about marketing tactics, which will follow in our next installment.

How to Get Started in the Design Business

Know what you're good at, and what you wish you were good at. Outsource the latter until you learn your vendor's methods. Note the partnership in your portfolio. People won't look down on you for being a team player. In fact, they'll want you on their team because you know who to call when you need to bring in a photographer or a copywriter.

Sell what you're capable of providing and what is within reach. Designers are always encouraged to stretch outside their boundaries, and that's fair if you're strong in a related area -- a brochure design to go with that logo you just put together, or a newspaper ad that goes along with the billboard. Don't cross clear boundaries, like offering to design a Flash advertising campaign just because you've done some print ads, if you don't have the chops to fulfill it. Build your expertise on work that's structured to accommodate long-term learning, like pro bono projects.

Even if you think big picture, you may need to start small. A portfolio accretes over time, slowly evolving. Don't think every project will land within the hallowed pages of your book, or you will pay for it in skinned knees and time lost. Those who choose their battles wisely see the utility of failure and the value of identifying what work deserves that extra 3% of polish.

Know your methods. They're what set you apart. Utilizing software is a skill. Design thinking is a talent. You need to merge the two to win in this business. Oh, and also a really good account manager.

Stay humble, but be an authority. There's nothing worse than a designer with a big ego, lording over their client. It's not your name on that poster -- it's your client's. Do what's right for them and you'll have a job. Become an Artist with a capital A if you want to fulfill your dreams and impose your vision on the world. The pay isn't so hot, though...

Are You A Non-Profit Designer?

I'm not talking about pro bono work. I'm talking about barely breaking even on existing client work. You can make the most beautiful design work in the world and run yourself right out of business. Here's how.

Bill different rates for different clients, based on how much you like them. Sure, give that classy nonprofit a hefty discount. And that referral you got from your sister, cut them a break too. Pretty soon, everyone's getting a deal, and you're bleeding money. Keep a consistent rate structure and you'll be protected in case of emergencies. Don't bill clients like you're running a retail store. You aren't selling a product. You're providing a service.

Give little extras away for free on every client project. It wasn't in the contract, but it'll just take you a few minutes, so why not make that sticker? And if they need changes to it along with a quick little one-sheet, that'll take only take a half-hour, right? There goes $1,000 out the window. Every time a client asks me for something gratis, I have to weigh the value of the work they've requested against the long-term value of the work we're contributing to their business. With rare exception, extra work always requires compensation. Otherwise, your client will expect the Mercedes-Benz luxury treatment when all you've got is a Toyota hatchback to offer.

Be a killer designer, but don't keep up with technology. Assume that every three years, the technology landscape will change dramatically. Browsers evolve. Markup standards change. Printers upgrade their prepress systems. Software vendors change the fundamentals of their interfaces. Not knowing your tools and implementation methods, or not having a strong support staff that can keep you up to date, can cause you major strife while you're also trying to get out the work. It also plants fear in the hearts of your clients and is a big risk factor for retaining business in the long term.

Do spec work to land every project. Rule of thumb: If you can afford to give away a week of work for free in order to land every new project, you probably shouldn't be doing spec work. You should be taking a vacation due to your extraordinary wealth. Or, as is more often the case, you should be scrambling to improve your cash flow by closing new-business opportunities that only require proposals -- and fewer flaming hoops to jump through. Besides, those flaming hoops usually set your clothes on fire and then you need to run around in circles, waving your hands in a panic until help arrives...

Ecotagging: Fostering Transparency for Sustainable Business

Consumers now expect sustainability and ecological sensitivity to be factored into the cost of manufacturing and selling consumer goods. Corporations such as Patagonia, through their Footprint Chronicles, and Timberland, with their nutrition label for social responsibility, have started a major trend that pulls back the veil on the apparel industry, making us aware of the major demands that the textile industry put on our world. It's not enough to just offset your purchases. Through our purchasing decisions, we can alter how the industry operates.

The EcoTag for apparel, shown below in a draft format, was designed as a prototype to make sustainability factors more transparent for purchasing decisions across all brands -- not just these brave few who are striving to lead the industry. The ultimate goal of the EcoTag is to incent corporations to make their sustainability measures accountable to their customers. “Sustainability grading” or other methods of ranking products, derived from ecotagging, would create new ways for customers to evaluate the value of a product, while forcing corporations that have since been uninterested in bringing sustainability practices to their businesses to change their behavior.

The front panel of the tag displays the standard SKUs for a product, as well as the costs of offsets and recycling that have been factored into the product price.

The back panel of the EcoTag gives a view into how a piece of apparel was sourced, produced, and shipped, as well as the average carbon cost and whether the clothing is organic, recycled, and/or biodegradeable.

Ideally, the tag would be resized, printed, and affixed to goods in a way that had minimal impact on the product’s carbon footprint.

Without an industry-wide standard for this type of information, it will continue to be difficult for consumers to make educated decisions about what they purchase and how their purchases will influence the world. With proper education of the consumer at point of purchase, the latent waste of the textiles industry may be reduced and ideally replaced with more sustainable options.

Download a one-page PDF summary of this piece at this link: http://www.davidsherwin.com/EcoTagForApparel.pdf.

If you're interested in helping with this endeavor, please feel free to contact me at david at davidsherwin.com.

The Three Fundamentals of Creative Strategy, Pt. 3

Read Part 1 and Part 2.

Great creative strategy always starts with a clear articulation of a business problem, and a rational strategy for solving it. This is the outer layer of the onion that peels away to expose a marketing strategy -- or a sales strategy, or a need to retool existing products or services due to customer feedback, etc.

To forge the right approach, quantify the business problem, qualify the competition, and distill what you've learned to show understanding of their need. This post talks about qualifying the competition and distilling what you've learned.

Qualify the Competition and How It Shapes the Problem

After the client presents the business problem and you ask necessary questions to understand its context, look at everything you can find that frames the problem from the competitor's point of view.

Clear business strategy is crucial for us designers in presenting proposals or participating in a pitch, where clients may intentionally refrain from disclosing key information to see how much you can glean and intuit from the scraps scattered across the media and the Internet.

You need to sniff out the business reasons for specific marketing initiatives through client interviews and research in order to ensure that you're making the most appropriate strategic decisions to solve their business problem.

You also need to show that you understand the world that your client lives in, understanding the trends that shape their industry.

This is different from traditional market research, which would live in your marketing strategy.

This is knowing which competitors are privately held, and sometimes more nimble, versus publicly traded. Which products in their industry are selling the best, and why. What the analysts from Forrester and other trending firms are saying about your industry category. What the Wall Street Journal noted in their most recent column on your corporate outlook. What is going on locally and globally on a cultural level that could have an impact on your business.

All these elements shape the world view that your client holds. Being able to present this kind of information, peppered through your ongoing communication, lets your client know that you appreciate where they're coming from -- and helps to support your creative strategy from a business perspective.

Distill What You've Learned to Show Understanding

The best trust-building exercise with a new client is reflecting back to them what they said, in an intelligent manner, with a few key learnings that they may not be aware of.

Whenever you write a proposal for a new project, you should begin the document with a narrative articulation of the client's business case and current strategy. This shows to the client that you understand their business needs at a high level, and any marketing recommendations that may follow are derived directly from their needs.

Always try to simply answer Who? What? When? Where? and Why? The How? is always proposed through what follows the business strategy: our marketing strategy.

As you craft this paragraph or two, be aware of your audience. As such, I make it as simple and quick to understand as possible. I always pretend, as I'm writing, that the CEO of the company could get their hands on this document. Besides, don't you want the CEO signing off on the dotted line and handing you that nice big project?

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Future posts in this series will talk about how to leap from the business problem to your creative solution through marketing strategy and tactics.