Pantone's 2024 Color of the Year.

It'll make headlines, but we're not gonna talk about it a lot in this video because selling colors is not how the company makes money.

It also doesn't make money selling paint or color mixing machinery or even color itself.

What Pantone sells is something much more abstract, a promise of uniformity so that the color Peach Fuzz looks the same, whether it's printed out on a billboard or a ceramic mug.

This whole idea that you can sell consistency is relatively new.

It's the brainchild of this guy, Lawrence Herbert, AKA, the king of color.

This is the Economics of Pantone.

New Jersey, 1956. Recently graduated chemistry major Lawrence Herbert joined a small printing company called Pantone as a part-time printer.

At the time, product packaging was less consistent.

Now we're used to seeing products come in identical packaging, like all these blue Modelo boxes.

But Pantone's president says, "It didn't use to be that way, back when everything was done over the phone."

It's really difficult to say, "Hey, that's a, it's kind of like a cherry wrap, but not as bright, but maybe slightly darker."

It is really hard to actually convey that message.

For example, see these two camera boxes?

The yellow on the right is brighter than the one on the left.

Kodak says customers were more likely to buy the lighter yellow boxes, logically thinking that the darker boxes were older and therefore contained older film.

Customers didn't know that the difference in color was due to the fact that the boxes were printed at different factories.

Each of which mixed their own versions of Kodak yellow.

Herbert recognized this was a problem as he worked his way up the ranks at Pantone, he became known for his expertise in color chemistry.

And when he bought the company in 1962, he had an idea to change it from a printing company into something entirely different that could solve Kodak's problems.

His team created a set of formulas, so every factory printed the packaging in the same color.

For a lot of companies, color is part of their brand identity.

There's Tiffany and they have that specific blue, and it's very important because we say, "Oh, that's Tiffany Blue."

We see the box and we go, "Oh, you got me a Tiffany ring."

67 years after Herbert joined the company, Pantone has developed these formulations into over 10,000 colors.

So no one actually owns color.

What we have is the IP of the Pantone color system, which is a collection of colors that we have selected for it's not just this beauty, but it's reproducibility across different formats.

Matching colors across formats is harder than it sounds, but it's vital for companies.

They may have a color in mind that they want to make sure that can be reproduced across different materials that they may be presented color,

whether it could be from their clothing line, all the way to the storefront, all the way to the internet representation on the website.

So say a company wanted the same color on its packaging and its magazine ads, the ink might look one way on cardboard and another way on glossy paper.

So Pantone would have to provide slightly different formulas to make the colors look exactly the same.

For example, the cardboard formula would be adjusted to a matte, absorbent, slightly textured surface, while the formula for magazine paper would be altered to account for the shiny finish.

To ensure all colors look the same, Pantone has a rigorous quality control process.

The company uses a tool called the Spectrophotometer to compare the same color on different surfaces.

So Pantone would analyze reflected light from the materials and generate a number value based on that color.

Then they'd compare it to the number for the color in their official index.

If the data doesn't match, they'd have to reformulate.

You know, basically someone's out there checking these cards to make sure that the fabric that we've dyed are within a certain Delta E difference,

meaning that it the color is consistent one by one, and it's highly, it has to be highly accurate.

Pantone has done color testing for over 10,000 colors, which it compiles into these Color Guides, like this 1964 version, which cover the whole gamut or range of colors logged by the company.

There are dozens of different versions of the guidebooks.

Some are even made specifically for certain companies.

About half of our revenue comes from the physical guides that we have.

Because there are so many different formats of it.

They can cost about $700 for this essentials kit to about $9,000 for a set of color display towers.

Pantone says the guidebooks generate the most revenue.

It sells them to designers, marketers, and artists annually.

Each year they're updated with new colors.

Your book is exposed to air and it can oxidize, and then what you see in your book can visually change when you look at it.

So then you won't accurately know if that's the exact color that you are looking for.

So for that reason, it is important to keep getting fresh books so that you can view them accurately.

Pantone says the other half of its revenue comes from its consulting and licensing and digital services businesses.

Universal Studios approached Pantone for the 2015 movie "Minions", asking them to make a new yellow.

It made this banana inspired hue and standardized it for the franchise.

Banana?

Uh, Stuart?

Banana!

Companies can trademark specific colors, so you can't say, "Make and sell your own competing products using Tiffany Blue."

But when it comes to all the other colors in Pantone's guidebooks...

So those who get their hands on the color, of course they can use the color,

but when we're communicating colors between different people, and this is where the Pantone IP comes into handy.

Because we can refer to a specific shade, a hue of a color through its name.

While the majority of Pantone's revenue comes from those branches, it's well-known marketing campaign might be what makes it a household name.

2024's Peach Fuzz is inspired by warmth and healing.

A Pantone spokeswoman said they anticipated increased interest in self-care in the next year, which they felt the shade represented.

We want to make sure that our community of creatives and designers, you have a conversation about color every year, at least once a year.

After nearly five decades of ownership, Lawrence Herbert's family sold Pantone to X-Rite in 2007.

The company makes color measurement tools, which helped to cement Pantone status as a color authority.

Just five years later, X-Rite was acquired by the Danaher Corporation, a life sciences and technology conglomerate.

In October, Pantone and X-Rite spun off from Danaher with 11 other companies into a newly traded company, Veralto Corp.

While Lawrence Herbert could have never predicted Pantone's evolution, his idea was a leap forward for the marketing industry and the world of color.

And as products advance from physical to digital, Pantone's scope will have to keep evolving.

When it comes to color, we want to make sure that it's always going to be consistent no matter where you are, whether it's in digital format, where we can continue to expand on that,

those products and services, or in different types of physical formats to help by our customers and clients find the right color and be able to execute those colors the way that they want it to be.