The survey among Austria's creative enterprises revealed that business start-ups in the creative industries are primarily intrinsically motivated. External influences, such as the continuation of family tradition, dissatisfaction with the previous occupation or the prevention or termination of unemployment, play a role less frequently, but comparatively more frequently for female entrepreneurs. The central motive for starting a business for entrepreneurs in the creative industries is the opportunity to work independently, and is given by more than three quarters of creative entrepreneurs as the reason for starting a business. The opportunity to live out their creative potential as well as flexible time management, independence and self-fulfilment are also important factors for about half. For women, the better compatibility of family and career in self-employment is a motive for founding a company more often than for men.
Before becoming self-employed, the majority of creative entrepreneurs had a salaried job, similar to the economy as a whole. Half of the creative entrepreneurs who were previously employed held a management position, whereby the proportion of women is lower than that of men. In the case of female entrepreneurs, it is also evident that other (gainful) employment (e.g. maternity leave, work in the household, etc.) plays a role immediately prior to founding or taking over a company more often than men. In general, the larger the enterprise, the higher the proportion of entrepreneurs who had previously held a managerial position or had already been active in business with someone else before managing the current enterprise. Multiple entrepreneurship plays a role for one tenth of the creative entrepreneurs; they were previously self-employed with another company.
On average, creative entrepreneurs, irrespective of gender, have gained ten years of professional experience before becoming self-employed. About 9% of the founders in the creative industries have no professional experience. Almost 20% of the entrepreneurs had less than five years of professional experience before starting their own business. This also roughly corresponds to the share of those with more than 20 years of professional experience. Shorter periods of education are compensated by longer professional experience. On average, academics in the creative industries have the least professional experience.
With a median of five years of industry experience, entrepreneurs in the creative industries work in the industry of their later entrepreneurship for about half of their professional activity before becoming self-employed. Architects gain an above-average amount of industry experience, while designers, for example, work in the design sector for less than five years on average before becoming self-employed.
Relationships with customers and business partnerships
Relationships with customers represent the central success factor for Austria's creative enterprises. In view of the economic development in 2009, which was felt by about two thirds of the creative enterprises in the form of increased competitive pressure, this factor was increasingly emphasised: Intensifying the loyalty of customers by responding more to their wishes was the most frequent strategy of the creative enterprises to react to higher competitive pressure. Almost half of the enterprises in the creative industries increased their innovation efforts. Price reductions played only a minor role for creative enterprises.
It also fits into the picture that price is rated comparatively insignificant as a factor for market success. For the creative enterprises, market success depends most strongly on the relationship of trust between client and contractor as well as on flexibility in dealing with the wishes of clients. For more than 90% of the companies, these two factors are (very) important for success.
The importance of the customer relationship is underlined by the fact that recommendation by customers is the most important form of new customer acquisition for creative enterprises. Although personal contact is mentioned most frequently in absolute terms, it is ranked lower in importance than referrals by customers. The referral by business or cooperation partners as well as the internet presence through an own homepage are also rated as important in this context. Participation in tenders is less important for the creative enterprises as a whole (in contrast to architectural firms) in order to acquire new clients.
A closer analysis of customer relations showed that the customers of the creative industries are mainly from the region and are primarily other businesses. Many creative enterprises offer products or services that are specifically tailored to the needs of their customers. The joint processing of projects with customers is also widespread in the creative industries. Along the two dimensions "development of own creative ideas" and "orientation of business activities to the processes and structures of customers", 22% of the enterprises in the Austrian creative industries can be classified as enterprises that implement their own ideas for a few customers. These mainly include architects. 31% of the creative professionals develop their own ideas and offer them to a broader circle of customers. These are mainly companies in the content industry, advertisers and publishers. 22% of the companies in the creative industries take up ideas from their customers and implement them with a focus on a few customers; this is especially true for software & games companies. 25% of the creative enterprises can be described as creative service providers for a wide range of customers, whereby mainly designers pursue this strategy.
With regard to the success of creative enterprises, a model that aims at high own creativity with rather low integration into customer processes and low dependence on individual customers seems to promise higher business success than strategies that are oriented towards very close cooperation with customers. In any case, companies that show a lower intensity of customer cooperation are on average larger and more satisfied with the achieved company growth.
About three quarters of the enterprises in the creative industries cooperate with business partners in order to jointly provide services for customers. Overall, the cooperation is more often project-related than permanent and is predominantly based on informal forms of cooperation. Almost 40% of creative enterprises regulate their business partnerships only through oral contracts, while only a quarter insist on written contracts. The business partners of creative entrepreneurs are for the most part other smaller enterprises from the creative industries themselves, most of which are located in the immediate vicinity, although meetings with these business partners very rarely take place on a daily basis despite the geographical proximity.
The share of turnover generated by business partnerships in the creative industries is 21%. In addition, business partners also play a role in order acquisition and as providers of ideas. Business partnerships do not mean that the companies also work at joint locations; only 15% of creative companies with business partnerships use joint locations. As a rule, business partnerships do not include more than 5 partners, 44% only work with one or two partners.
With regard to business success, it is evident that companies that primarily enter into project-related business partnerships show poorer business development and lower employment growth than companies without or with permanent business partnerships; these companies are also less satisfied with the company's development. The higher the proportion of turnover generated through business partnerships, the less favourable tends to be the development of business volume. In contrast to this, however, is the finding that companies that frequently receive orders via their business partners grow significantly faster. It is also found that companies that regulate their cooperation through a written contract are more successful, and companies that use common umbrella brands with their partners grow significantly faster.
Within the creative industries, various value creation networks can be identified: Creative networks in media production bring together publishers or radio & TV broadcasters with content creators and designers. In advertising, such networks include smaller and larger advertising agencies, designers and content providers, for example in the field of music. Architectural cooperations are a form of association that brings together various architects as well as technical offices and companies in the construction (ancillary) trade. Partnerships of specialists are more frequently found in the software and content sectors, whereby small creative companies with complementary focal points join together to form bidding or service provision cooperatives. Involvement in creative networks tends to have positive effects on business performance. Firms that are part of value networks in the creative industries grow more slowly than other firms, but report more favorable business performance for the past two years. They are also more successful in achieving the business goals of high profits, working on interesting projects and collaborating with interesting clients.