Brian Clark on Transmedia Business Models (Part Three)

This is part three of a five part series by transmedia designer and theorist Brian Clark.

A HANDFUL OF BOTTOM UP MODELS

by Brian Clark

In the prior two installments, we looked at what might drive the next wave of innovation in storytelling and dissected the patronage business model that dominates the transmedia space today. In this installment and the next, I want to dive deeper into ten different alternative business models that we know work from other media movements in the hopes that they provide some inspiration to other entrepreneurial storytellers. The first handful treats funding and sustainability as the primary challenges: if you don’t have access to millions of dollars, just how much capital do you really need? Do you need any at all?

No Budget

Some artists and art movements solve the business model problem by assaulting the very need for capital funding. They might treat funding as unnecessary (such as Theater of the Oppressed in the 1950s, the Dogma 95 film movement of the late 1990s or the subsequent Mumblecore movement of the early 2000s that embrace no budget as a choice) or might literally treat capital as the enemy (such as the dÈtournement of the Situationist International movement of the 1950s or modern Anonymousí physical and digital hacktivism). In the context of business models, their solutions look something like:

  1. FUNDING: Is a distraction from making art.

  2. RETURN: With no funders, there is no distraction of returning investment.
  3. SUSTAINABILITY: My project is not about having a sustainable career as a creator.
  4. AUDIENCE: A community to awaken or empower.
  5. PROMOTION: Through provocation, controversy and guerilla tactics.

No budget movements are a healthy part of any artistic form: things get made all the time without having business plan justifications. The Internet and digital creative trends amplifies these kinds of models disproportionately because of the constant increase in tools that decrease the costs of production towards free. Sadly, it isn’t decreasing the cost of your food, rent and healthcare towards free and no budget artists typically have more traditional jobs that pay those bills — which might be, in part, why Lars von Trier doesn’t still make films under the Dogma 95 model.

Grassroots

Sometimes, not having funding isn’t an active choice but is definitely a current reality. This is familiar territory to independent artists and publishers, from pulp fiction zines of the 1930s through the punk D.I.Y. ethic of the 1970s to the Internet tradition of “grassroots alternate reality games” of this century — you embrace your limitation as a virtue and make the most of it. For this “D.I.Y. ethic” style of grassroots, the business model solve might look like:

  1. FUNDING: Beg, borrow, and elbow grease.

  2. RETURN: The expectation of paying them back isnít very high on either side.
  3. SUSTAINABILITY: Iíll at least live to fight another day.
  4. AUDIENCE: People who are looking for something different than the mainstream.
  5. PROMOTION: Through provocation, controversy and guerilla tactics.

Rather than being entrepreneurial, the funding in grassroots efforts is ad hoc, doesn’t really set revenue goals for sustainability and leaves little funding for promotion. Sometimes, for the artists, the connection and affirmation of an audience is still enough reward to make them want to do it again.

Research & Development

Hopefully, creating always involves learning new things, but sometimes the point of making it in the first place is to learn. The R&D arms of giant companies share this business model with entrepreneurial garage tinkers and both work in prototypes and proofs-of-concept. Some creators, most notably Lance Weiler, have started talking about “story R&D” as the explicit value to their experiments — learning how to tell stories across all these new platforms and opportunities in relatively low capital risk environments. An R&D business model solve might look like:

  1. FUNDING: Angel capital (including my own).

  2. RETURN: Something new that will require a new business model solve.
  3. SUSTAINABILITY: Iím increasing my capabilities and chances for future success.
  4. AUDIENCE: I wonít necessarily need a large one.
  5. PROMOTION: Through provocation, controversy, partnerships and guerilla tactics.

The most inherent challenge in R&D models is that you’re entrepreneurially deciding to push the return on your investment and sustainability to some future date. It requires some confidence (at least on the artist’s part) that those kinds of R&D results are a predictable yield and tends (by necessity) to push the work into more experimental territory (because there is very little R&D yield in doing things you already know how to do).

Fan Incubation

Most artists will tell you that a fan is more valuable than a customer — a fan base is a renewable resource for a sustainable career. Fans buy the next album, they subscribe to the series, they evangelize their passion bring in new fans, and they camp out in lines overnight before the opening. In the past, fan development was slow (for example, the way fan correspondence saved H.P. Lovecraftís works from disappearing) or physical (like the “make record and tour college towns” model of independent musicians like John Vanderslice). The age of the Internet has revolutionized the ability for creators and fans to have rich, meaningful interactions that have led to successes like The Blair Witch Project and innovations like the distribution strategy for Four-Eyed Monsters. Whether a small indie or a big company, fan incubation business model solves look something like:

  1. FUNDING: Angel capital and sweat equity.
  2. RETURN: A motivated audience for a forthcoming work.
  3. SUSTAINABILITY: I’m increasing my chances for success (and return) on some other product.
  4. AUDIENCE: My growing fan base.
  5. PROMOTION: The efforts of the fans themselves, supplemented by owned (maybe even paid) media

This is essentially the same model I critiqued in the prior installment, but with a key difference: you’ve become your own patron, you’ve become your own client, and you’re leveraging the tactical usefulness to your own potential benefit. Like the research and development model, that means you’ve pushed off revenue and sustainability to some future product those fans want that has its own business model as an investment in a renewable resource.

Fan Funding

Speaking of the power of fan bases, if you already have even a residual fan base, there are ways to replace funding with those fans. In the classic models, you’d call this pre-sales — collecting money for a product you haven’t made yet to fund the creation itself (often incentivized by some exclusive value add), a model quite common now in the videogame industry but also the classic underpinning of why magazines and newspapers offer annual subscriptions. The Internet’s capabilities for crowdsourcing have made this an even more attractive model for independents, whether you’re harnessing fans as angel capitalizers with a system like Kickstarter or selling a product that was manufactured “just in time” via a platform like Lulu. The business model might look something like:

  1. FUNDING: From your fan base as pre-sales or angel capitalizers.
  2. RETURN: A special copy of the work, a credit in the finished piece, etc.
  3. SUSTAINABILITY: My fans will support me because theyíd like to see more work.
  4. AUDIENCE: My growing fan base.
  5. PROMOTION: The efforts of the fans themselves, supplemented by owned (maybe even paid) media.
  6. The scale of this model is directed tied to the size of the fan base: George Lucas will always pre-sell more than you do, but a smaller group of fans could dramatically change the way a grassroots project might operate. Many creative properties (large and small) leverage this business model in serial with fan incubation — when you’re not pre-selling something, grow the overall size of the fan base as an investment in your next cycle of fan funding.

    In the next installment, we’ll look at another handful of models that solve from the opposite direction: maximizing revenue instead of minimizing investment.

    Brian Clark is the founder and CEO of GMD Studios, a 16-year-old experience design lab based in Winter Park, Florida. He lives in New York City and occasionally tweets as @gmdclark

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