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Marketing and ad agency leaders are frequently surprised when I tell them that they are probably sitting on a large pile of intellectual property, a lot of it underutilized and most of it unprotected.

Agencies are typically so focused on the ideation and creativity they employ for their clients that they rarely take a breather to think about their own intellectual capital. Or, because it doesn’t represent work that is immediately “client-billable,” they may either undervalue it or fail to maximize its value in favor of other more obvious revenue opportunities.

Intellectual property is an asset that an Agency can turn into cash.

Intellectual property is just that – property. It is an asset that can be turned into cash in the form of licensing income, royalties, additional professional fees, or an enhanced purchase price when the time comes for the Agency to be sold. It may also create ongoing passive revenue streams for the Agency to supplement its Client billings.

But where and what are the assets? Here are some places to look for hidden intellectual capital in your Agency:

Original Brand Trademarks and Taglines – Does the Agency have a unique brand name or graphic identity? What about a promotional tagline? Or, does the Agency have proprietary products or services that are individually branded? Any of these word or logo brand marks can serve as a trademark owned by the Agency and, if the trademark is federally registered, the potentially exclusive national rights to that mark in your industry. If your Agency holds a unique positioning or has a particular client niche, the trademarks can be even more valuable as Agency assets. Note, also, that wherever the Agency can identify a trademarks, it has probably also identified another potential intellectual property asset of value (like one of the others listed below).

Unexecuted Client or Spec Work – Remember that highly creative spec project the Agency worked on, for the prospect that didn’t close? The Agency still loves the concept and the assets – perhaps they can find a new home with another client or in a new market? What about the concepts the Agency pitched to the Client but didn’t make the final cut? Unless the Agency agreed to restrictive covenants with a Client or prospective Client that tie its hands, these assets can be redeployed for another campaign, another pitch, or just for the Agency’s portfolio as a business development tool.

Proprietary “Client-Facing” Processes or Methods – Many agencies have proprietary processes or methodologies they employ in serving Clients, including proprietary (and usually branded) discovery processes, brand development methods, research tools, or strategic frameworks for ideation. If your Agency has these, and considers them unique and differentiating, then they likely constitute or include protectable intellectual property.

Proprietary “Agency Internal” Processes, Methods or Training Curriculum – Many Agencies are highly savvy about creating internal intellectual capital such as training modules, business development methodologies, financial and billing systems, or thought leadership content in a particular industry niche or marketing discipline. Sometimes an Agency spots a revenue opportunity in its ability to share some of its expertise with other agencies, in a way that won’t compete with its competitive position in the market, and for compensation. This might take the form of education courses, licensing of proprietary systems, or consulting programs for other marketing firms.

Original Technology Solutions – Perhaps the Agency has a particular niche in a specific technology, such as mobile app development or software tool development, and uses its expertise to develop custom solutions for Clients. Does it also have proprietary code, or platforms, plug-ins, or other original tools that could be licensed to multiple parties (for example: a mobile app that can be “reskinned” or “white labeled” by others)? This is a great example of the Agency leveraging a particular intellectual asset in multiple ways, for recurring revenue opportunities from multiple sources.

What should the Agency do if leadership thinks it has some intellectual property in its portfolio? In our next posts, we’ll discuss how to conduct a simple audit to identify those assets and how to take steps to prioritize the Agency’s intellectual property protection efforts. Stay tuned.

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