Looks matter

Forbes , May 02, 1999

KINKO'S HAS LAUNCHED a $40 million marketing effort to convince customers that everyday communication requires polished graphics. Its ads depict humorous applications—tell off the boss by leaving him a travel brochure for hell or pop the question with graphs of your increasing love and projected earnings—but the message is serious.

Appearance matters. As the tag line says, "Sometimes it's not just what you say but how you say it."

Welcome to the esthetic economy. Technology and competition are driving down the cost of beauty, from four-color printing to cosmetic surgery to mass-market furniture. Meanwhile, we're getting richer and demanding a more esthetically pleasing environment. More beauty is a natural product of increased affluence. Good design is an important source of economic value and competitive advantage.

"In a world in which most consumers have their basic needs satisfied, value is easily provided by satisfying customers' aesthetic needs," write marketing professors Bernd Schmitt and Alex Simonson in the book Marketing Aesthetics. Those needs aren't limited to such niches as fashion, cosmetics or entertainment. Starbucks, for instance, built its brand not just on coffee but on a distinctive style that echoes the precise lines and luxurious textures of high-end office design.

Or consider Target's new line of housewares: some 200 items designed by architect Michael aves. This isn't a celebrity play—Graves is well- known among style aficionados, but he's hardly Martha Stewart. Rather, Target is betting that fun design will drive up sales; Graves is just the unifying brand. If you've got the cute Graves toaster, you'll want the matching mixer, tea kettle and can opener. And only Target stores will have them.

That's the good-news scenario. If the beauty bar goes up everywhere, however, the gains will go to consumers, not producers. As with computers, we will get a "productivity paradox." The world will be better-looking—a good thing, and thus an increase in the general standard of living—but investing in esthetics will mean business survival, not higher profits. And that race is on.

Esthetic expectations have increased everywhere, from the signs on neighborhood shops to the look of rsums. No business pitch is complete without PowerPoint slides. That's why Kinko's can cater to customers' insecurities about unslick presentation. Like most economic trends, the esthetic economy has its losers: What if you were just born ugly, or your publication can't afford color printing? What happens to the great cook who can't design an attractive restaurant?

Besides these victims, the esthetic economy draws fire from people who think beauty is frivolous or subversive. Social critic Daniel Bell numbers the "follies of fashion, luxury, splendor and extravagance" among the "culture contradictions" that will doom capitalism. (Shame on Starbucks.) Beauty, he suggests, is incompatible with the ascetic Protestant ethic.

Less abstractly, Scott McNealy, the chairman of Sun Microsystems, famously banned PowerPoint as a waste of time and bandwidth. He wants plain text, without special fonts or formatting. It's the perfect crusade for a macho engineer—and it's a loser. Stigmatizing beauty is business suicide.

The better strategy is to learn the difference between using every gewgaw in the tool kit and creating a pleasing package. Don't ban graphics; do ban three-dimensional bar charts showing two-dimensional information. Don't ban creativity in the sales brochure; do ban font free-for-alls that make the brochure look like a ransom note.

When the design magazine I.D. recently honored North America's "most design-driven companies," most of the standout products were both distinctive and functional: the Airstream trailer, the Bloomberg screen, the Oral-B toothbrush, the Amazon.com Web site. Even analytical nerds could appreciate them.

That's the esthetic economy's power: Idealogues may call beauty a myth, intellectuals may insist that the thought is all that counts, corporate managers may squirm at dealing with artists—but beauty appeals to us all. Ignore it at your peril.