Riding out the recession.

(The following blog entry was originally posted on Blogger on 02/27/10)

It was bound to catch up to us sooner or later. That ugly "R word" that evokes fear in the hearts and minds of corporate employees and their agencies. After weathering the volatile workflow and cashflow of 2009, a.k.a. The Year of Lowered Expectations, my business partner and I are now seeing the recession's teeth. And they look long and sharp and a little yellow.

So what is a small ad agency/design group to do? Well, the answer is get proactive. But first, let me share with you some of the things that happen in a recession - things we've experienced first-hand that educate us about how clients respond to something of this magnitude.

One thing is for sure: employees are worried. We took some of our clients (all of whom are marketers with varying degrees of age and experience) out to lunch in January and found them all feeling the sting of the economic slowdown as their customers are cutting back. Marketing budgets have been downsized. Perks and bonus have been reduced or eliminated. 401K contributions have been halted in some instances. Business travel is out - except for maybe the VPs. No holiday parties or lunches. Employees' contributions to healthcare plans are increasing. They didn't come right out and say it, but I'd presume it's pretty stressful and hurting morale. It's making an already difficult corporate job that much harder. And this is hard to hear from our clients.

Then there's the job loss factor. Many of our clients/contacts have been laid off and when that happens, we lose business. We often don't know where they've landed, or if we do, they often have an ad agency or list of contractors that are already in place. So their hands are tied. Some of them have decided to go back to school and either get an advanced degree or get retrained. I would speculate that others, many of which are women, have decided it's time to start a family and hope by the time the kids hit kindergarten, the economy will have restarted its engines.

So what's a small company like ours to do? Funny you should ask. As you may have read in a previous blog of mine, 2009 actually ended well for our company. Projects came fairly fast in the last quarter, and it allowed us to fill in some missing months of 401K contributions and to buy some new Macs. It looked as is if the grip on budgets was starting to loosen. But now we're back to treading water. We know we're covered for a couple months from a cashflow perspective, but beyond that, it's anybody's guess. Which means this: It's now time to take action or face the consequences.

For us, the issue is the industry in which we get the majority of our jobs. Most of our business comes from the magazine publishing industry. That indsutry is reeling from the recession -- subscribers are cancelling their subscriptions and newsstand sales are down. Nobody wants to drop $5 on a magazine AND another $5 on a latte. It's an easy choice. Magazines don't give you a withdrawal headache if don't get it by 9am. Plus, whatever content they're subscribing to can probably be found online anyway. Adversity breeds alternatives. (I think the iPad and iBooks Store is going to help revive it, but that device is going to need 4-5 years to mature, the way MP3 Players and the iPod did.)

Again, the proactive thing: it's become clearer and clearer that we've got to diversify our client roster. But before we can hit the streets running, we've had to update our antique website and marketing materials, revamp our rate card, freshen-up our positioning statement and marketable skills, and then go back out there, armed. But I'm prepared for frustration. New business development usually does not yield instant RFPs. It'll take time to populate.

Our sales plan is fairly simple. Dig around on the internet, cull email addresses and phone numbers from potential clients' websites and write them a new business inquiry email - what's the worst that can happen? It doesn't get answered. Move on. We're emailing old contacts like crazy. We're requesting connections on LinkedIn. I just built us a profile on Guru.com (I don't think it'll yield much, but you never know). We're looking into Google's AdWords. We created PDFs of our portfolio for distribution. And we've even done some cold calling. And let me tell you, if you never had respect for the folks in sales at your company, try cold calling a lead. It's humbling.

That's our approach to the recession as of this writing. We keep thinking, work hard and the clients will come. Or return, as it were. The overwhelming majority of our clients have come from referrals but now we know we can't rely on that as much. The game's changed at least for now. It's really tough out there, but I know we'll learn from it. A nasty recession can be an eloquent teacher.

Notes from Seattle, working remotely.

(The following blog entry was originally posted on Blogger on 01/28/10)

My wife and I came to rainy and gloomy Seattle on Sunday, January 24th, ostensibly for her to continue her battle/treatment for Lyme disease with a new Lyme-literate specialist who practices here. We're here for almost a week and will head back to NYC on Saturday, January 30th. Her doctor's clinic is actually in Kirkland — about 30 minutes north of downtown Seattle — so we're staying at a Courtyard Marriott in Kirkland. It's not exactly an up-and-coming suburb, but we've managed to find some decent eateries, and even swallowed our pride and ate at the Olive Garden (!) for lunch once. We did manage to find a cute little conveyor belt sushi place nearby so that sort of rebalances the food equation.

While here and shuttling her back & forth to the clinic, I of course work remotely as many professionals do. However, as a creative director and designer it's certainly a step forward to be able to do this without massive interruptions in our workload and workflow. There are pros and cons of working while traveling, and especially when working from the west coast.

The most obvious is the challenges of the 3-hour time difference. So far, I've had no problem keeping my body clock on NYC time and getting started sometime between 6 and 7am. This has worked well all week. We start the day, have lunch and end the day pretty much in sync.

Another challenge is getting work done efficiently. If you travel and need to work and/or solve a problem with a job that's in production, you have to have access to your job files. In the early days of my business, whenever I worked remotely I took my laptop along, and I copied our entire active client job library onto a portable Firewire drive and made layout revisions on it. Then we I got back, I copied the files back. This works fine as long as A) your files all copy without errors, B) you gave yourself plenty of time the night before to sit there and watch 100GB of data copy, and C) nothing happens to your drive in transit. I once took a trip and realized in my hotel that all the backup software I'd used had not copied the most recent "modified" job folders to my portable external drive. It was a depressing moment.

So for the past several years, my modus operandi has been to keep all job files on our office network drive and utilize the power of DynDNS.org. It allows me to access our network externally from any available broadband internet connection by recognizing the dynamic IP Address our router connects with at our ISP. Even with that somewhat sophisticated method of file access, copying the art and layout files can be slow. Like most home or business ISP's offerings, upload speed is much slower than download speed. Consequently, opening or copying my files from a remote location is slow because data is uploading through a slow connection out of our office, and thereby, to me. It works, but it's not nearly as fast as working within your own office's network. Be patient with this method. It saves you the stress of carrying your company's job files around, but it costs you in time.

I can't speak highly enough of smartphones in general, and the iPhone specifically, when working on the road. We've used it to navigate ourselves to virtually every destination we've needed in Seattle through the built-in maps app. (Conversely, the Sony GPS we brought along was nearly useless and often displayed a "weak signal" indicator. Avoid their GPS products.) The Whole Foods app came in very handy when we needed some things that only they stock.

In general, I found Seattle and its suburbs to be pretty wireless compliant, if not a bit too open maybe. I found open wireless connections all over the place. Good for me and accessing info with speed, bad for people who trust the universe and probably get hacked a lot.

Lastly, and this is more of a topical note rather than a summary and closing statement: I was here in Seattle while the Apple iPad media event broadcast on Wednesday. Cool product. I want one. I'm already thinking of the possibilities for client apps for it, and on a more personal note, planning what to do with all my future leftover bookshelf space at home.

That's all from the northwest corner of the U.S. Until next time...

The long Arc of technology...

(The following blog entry was originally posted on Blogger on 01/13/10)

When I entered the professional world in 1987, I had virtually no computer experience. While in college, I had played with the then all-in-one Macintosh 512K that the campus gallery had bought, and had drawn some abstract little nothing of a piece of art using MacDraw or MacPaint or some such program. But I basically had no idea they worked.

And then I was thrilled by printing an image out on a dot matrix printer. That would have been around late 1984/early 1985. The Mac was named the 512K because that was the maximum amount of RAM it would handle. Think about it. 512K. And a 400K hard drive. It had a 3.5" floppy drive, but that's what you ran your programs from. No seriously. I’m not lying.

Then in 1987 I got hired by a then-little-known company called Prodigy, which would become one of the first major consumer-oriented online services companies, I was trained on IBM PCs and really felt immersed in new technology. We were using PC ATs at the time, which were rather large units, probably the width and depth of a microwave, and about 8" in height. On top of the PC sat a 640 x 480 monitor, capable of 16 colors. Next to it sat a Hayes 1200 or 2400 baud modem (I have no idea how slow that is — I just know it's slow). We used a proprietary graphics program for generating sites and banner ads for advertising clients that used those 16 colors, and if we used any of 3 or 4 patterns, we could create the illusion of up to say 24. I remember the fervor over the news a couple years later than new PCs would ship with CD ROM drives. This would be a game changer for installing a more robust version of the service, and possibly expand the quality of onscreen graphics and product images. By the time Prodigy had a chance to expand the graphics capability of its software and service, the Internet opened up and off-the-shelf tools for creating HTML and GIF or JPG files buried it. (Speaking of Prodigy, its first CEO, Ted Papes, passed away on January 8, 2010).

In the mid-1990s I started a company with a colleague from art school and the first computer we bought was a Macintosh PowerBook 180c. We maxed it out with 14MB of RAM and an 80GB hard drive. A few months later we added a high-end desktop Mac, a PowerMac 8100/80 tower, which had a 80MHz processor, a beefed-up 24-bit color graphics card and 21" CRT color monitor. We used portable SyQuest drives with 44MB and 88MB disks for portable data. If you've never seen a SyQuest drive or disk, it's worth Googling. The were portable yes, but the drive unit weighed a good 8 lbs.

A year or so later, around 1996, I left that company and started to freelance as a graphic designer. The first system I bought myself was a used Mac IICi, but soon after that bought a PowerMac 8500 tower, with a built-in CD-ROM drive, 128MB RAM, another 21" color monitor, 24-bit color graphics card (that I had to install myself), Iomega Zip drive (remember those? 100MB disks, about the size of a 3.5" floppy disk), an Iomega Jaz drive (for larger jobs, 1GB and 2GB disks), a US Robotics 28.8K modem for dial-up Internet connectivity, and an external 2X CD-R drive for burning data to CD. Btw, while I had this system I upgraded the RAM with an additional 64MB, which then cost $369.00. Today, you can buy 8GB of RAM for a MacBook Pro for about $120.00.

Cut to last December, when my company purchased new some Macs - all of which have 3GHz processors, 4GB of RAM standard, 500GB hard drives. The larger iMac has a 1TB hard drive. I can't even do the math of how many times greater in speed that is from the old Mac 512K I used in college in 1985. All I know is that they super fast, and rarely crash. Wow, did I just write that?

It's mind-boggling to witness sea change after sea change with programs like Adobe Creative Suite and so many others that are so feature-rich. And yet the components of a computer continue to accelerate in speed and capacity and become smaller and thinner. Meanwhile, the price of a system remains constant, or in most cases, lower in cost year over year. It's good for businesses, like mine, whose technology start-up costs are far lower than in previous years. And it's something that I never cease to find fascinating. What's next? Looks like the iSlate (or whatever Apple decides to name it) is right around the corner. Get ready for another paradigm shift.