A new advertising agency is born! (warning: off topic, mostly)
Thursday, October 29, 2009 at 11:11PM 
Today, I read about a new ad agency called Victor & Spoils. To me, they are the lowest of the low in an industry capable of deep lowness.
In short, V&S claims to be "the world’s first creative (ad) agency built on crowdsourcing principles". Translation:
Rather than hire people and pay them a wage, V&S will offer a chance to some lucky few to donate their ideas to V&S's clients (even to V&S itself). If V&S decides a donated idea is good, they will pay for it, but the amount is solely at their discretion.
In other words, their client could be Coke and you could contribute the new tag line, and for your efforts be paid a penny and you would have no legal recourse to seek more. Worse, when they "buy" your idea, they own it, totally. They can change it however they wish and they are protected from ever having to pay you a dime more. Don't believe me? Here's the V&S contract.
One of the legal terms used in V&S's contract is "work for hire". I'm familiar with this because I use it myself, as does everyone else in the music biz. Record companies LOVE WFH because it means they can hire a guitar player to come in and play on a song and even if he contributes the riff that makes the song, they owe him nothing more than his fee. It's fair, to be honest, if not exactly cool. V&S, on the other hand, goes WFH one better: under the guise of "crowdsourcing" they will source 1000 guitar players and be under no obligation to pay any of them, and if they do end up having to pay because some lone axman delivered the goods, the fee can be as little as a penny (maybe less, I need to read the US contract, but I can't bring myself to).
Am I overreacting? I don't think so, but if someone out there can put a positive spin on V&S, I would like to hear it.
Oh, and icing on the cake: they moderate comments! Unbelievable.
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Reader Comments (10)
I left this comment. I'm sure it will be "moderated":
You guys are kidding right?
You are not changing an industry you are helping hammer one more nail in its coffin. For years we fought the idea of advertising by committee and you are legitimizing it.
You are not calling creatives with spirit you are calling all those willing to be underpaid while you guys reap the rewards.
As John Lennon said, “How do you sleep at night?”
I realize I'm whacking a hornet's nest here. If you hate this comment feel free to delete it...
The quintessential "crowdsourcing" gig is the "free-market" where "demand" is the agency that defines what's to be worked on (i.e. opportunity) and entrepreneurs are the people who often never get paid (most startups fail), the market pays whatever it wants (including nothing), and the entrepreneur has no legal recourse to get more, even if another business is later successful when he wasn't. Yet millions of entrepreneurs keep doing it (though less so lately). Since entrepreneurs are not forced to do it, I don't see any legal, ethical, or moral problem with the concept of the free-market.
Nobody is forcing anybody to work for this ad agency (BTW, are we sure this isn't a spoof? It's a rather peculiar name), so I don't see why it's a problem. I also don't see why anybody would work for (or via) this company, except...
1. As an internship. We often have interns working for us for free. We don't usually get much useful work out of them, but it doesn't cost much (other than time) and they get experience and an addition to their resume - a decent deal for all. A crowdsourcing gig could work like an internship program.
2. If there are too many people in this business to support the current wage. If you can't get a job anyway, this might be a chance to at least make something, someday. And again, your experience base would be enhanced for possible future jobs.
If there are too many people in this industry, this agency doesn't put a nail in the coffin. It just changes the playing field. With any change there are always winners and losers. In this case, given that there are too many people in the industry, there are going to be a lot of losers anyway (unless a federal bailout is coming). I'd guess that crowdsourcing would give younger, less established players more of a chance at the expense of the wage levels of older, more established players. That would likely feel unfair to older, more established players, and I wouldn't be at all surprised if they were unhappy about it. That doesn't make it an inherently bad thing though.
Like everything in life this will have it supporters and detractors. But I still cannot see it as anything other than devious people jumping on a trendy bandwagon because it gets them ideas on the cheap.
And degrading the value of ideas is truly a nail in the coffin of advertising.
Incidentally, an internship at this agency is offered as a "prize" if an idea of yours gets used!!
Give us something for free (or almost) then come work for us for free (or almost). Wow, what a deal! For the owners.
There's no way to put a positive spin on Victors & Spoils, Jeff. It's simply a lame idea. In many ways, it already exists. (See guru.com and crowdspring.com.) Their website says their internal creative department will "curate and direct" the efforts of the crowd, whatever that means. I can't imagine them ever attracting world class clients with real problems to solve or world class creative people with the skills necessary to wrestle those problems to the ground. My prediction? V&S will fail. And it won't take long.
Dave, with you on your comments.
Bret, If there's a hornets' nest, whack it, I say! And there's never comment moderation on this blog.
I agree with most everything you say. I too am a proponent of free markets (with clear rules!) and you are correct when you point out that no one is being forced to work for V&S. However, I don't see the parallel between adfolk who submit ideas to V&S and entrepreneurs who work for nothing in the hope of gain down the road. Most entrepreneurs work for essentially a royalty payout (say on a patent) or a one time hit that is worth maybe ten times, or even a hundred, their would-be hourly rate. Last, what really set me off about V&S was their hypocrisy and lack of transparency. The are hypocrites because they claim to be all about the wisdom of the crowd but they moderate the discussion on their blog, refusing (so far) to post my comments, which were tough, yes, but honest and not personal or vulgar. They are not transparent because they are not clear at all about their compensation practices. Hey, even if they're making things up as they go along, say so! It's called "beta".
Curvin, you are right, they will fail, and this is sad, because I think in better hands their idea could have merit. And the ad industry could use a success.
I find it kind of interesting that you ask if you are overreacting. Why react at all? Granted, I don't work in the ad biz and I could be totally off base here but, if Victors & Spoils is even a real company (I kinda think it's a put-on) it reads to me like simply another bad idea in a world that is already loaded with bad ideas. I think it's noise.
Maybe the odd new grad who can't find work or someone from outside the industry who fancies themselves a writer will contribute an idea here or there, but I have to think that few creative pros with any significant level of talent and self-confidence will contribute anything given their business model. V&S will ultimately get what they pay for and I think their chances of creating a sustainable business are pretty low.
Cory, good point, why the hell do I care about these clowns? Sigh... As you say, it could be a put-on, but I don't think so. Time will tell. Hey, I have an idea! Microsoft can hire VS and finally overcome lousy product via great ads! Go, Ballmer, go!
I think you have a right to care...and comment...when you see an industry that provided you with a good living, not to mention an outlet for your creative skills, being ruined by not just these "new" and, I think, stupid ideas but by the lack of any real ideas coming from the established agencies.
We react because something has been lost.
And to those of us who enjoyed working in advertising it's like my recent conversation with a local bookstore that was kind enough to agree to sell my book of poetry. I told the owner the book was on amazon. To which she said..."I know...but don't tell me that...those guys are in business to put me out of business." We are losing a lot in the name of progress.
Jeff wrote: "Most entrepreneurs work for essentially a royalty payout..."
A lot of entrepreneurs open restaurants, or retail shops, of janitorial firms, or laundromats, or plumbing companies, or ... I'm pretty sure the high-tech entrepreneur with the patent portfolio is in the minority.
I'll admit the parallels between the free-market and the crowdsourcing agency is far from perfect, but in each case the participant foregoes near-term income to hopefully have higher income in the future. Very few entrepreneurs have a shot at orders of magnitude increase in income, and I agree that those that do are not a good match in the metaphor. The rest fit somewhat better.
Also, my comment was directed at the concept of crowdsourcing in general, not V&S's particular instantiation. Indeed, I thought that website was a spoof at first, and I'll be surprised if they do well.
Bret,
When I wrote royalty payout, what I meant -- and should have written -- was a long term payout. In other words, as you rightly point out, entrepreneurs typically seek to build something that will last (pay over time, like a royalty).
Is V&S a spoof? I doubt it. I think they are entrepreneurs bankrolled by a large ad agency called Crispin Porter + Bogusky. But I could most certainly be wrong. And it is Halloween tomorrow...
Jeff