Archive for the ‘Printing for Ordinary People’ Category

Stealing Customers for Profit in the Recession

Friday, July 31st, 2009

Have you ever been woken up by cold water splashed in your face? That was what happened to me when I read a blog post on another site the other day. To paraphrase (because I failed to bookmark the site and can’t find it again–drat) he said that those in the printing business should not hold expectations that 2010 was going to improve the state of the market. Furthermore he said that there were only two things companies could do to remain viable during the coming year. The first, was concentrate on customer retention. In this market losing customers is like losing blood. Do whatever you have to do to stop the loss. The second thing  was steal customers from the competition. Honest to goodness, steal was the exact word used. It wasn’t attract new customers, it was steal customers.

Part of me understands his point while another part of me is revolted. In a down economy new customers are rare. Prudent people rarely start new businesses during hard times. Banks are loath to loan and entrepreneurs are careful.  So if new customers aren’t springing up that only leaves current customers. If they aren’t your customer, then they are someone else’s. There is something very distasteful to me about targeting some other company’s livelihood knowing that if you win you may be causing their demise. That is what the emotional side of me says.

The pragmatic side says that you have to face reality. If it takes stealing a customer to keep your company afloat, and allow your employees to put food on their tables, that’s what you have to do. Strike first before they strike you.

pirate skull and knifeIs that cutthroat? Maybe, but business is a jungle and it is survival of the fittest. Don’t we benefit as a society if those moving the bar up are the ones surviving? Don’t we get better goods and services? For the sake of all shouldn’t those weaker companies be weeded out? For the good of the garden thinning has to take place. OK, I’ve managed to mix at least three metaphors in the previous sentences, but you get my point–right?

Stealing customers might be a correct term even though it’s hard to swallow (yet another metaphor). I remember talking to a travel agency some years ago about their marketing. They got tired of fighting for position in the middle of the pack and decided to break out by being unique. What they did is identify ten commercial accounts who did large volumes in travel. Then they determined how much they were already spending on newspaper and magazine ads. They totaled their radio expense. In short they added all of their marketing costs and put it into an imaginary pot. Then they looked at those ten prospects again and divvied up the pot ten ways. During the next year they focused all of their energies on the golden ten. All they had to do was get three and their business would increase. When the dust settled, and the year was over they had six out of ten, and business more than doubled for them.

Those ten golden commercial accounts had been buying travel services from someone else. In effect, the upstart travel agency stole their customers. Or as I like to think of it they won the business. Because they were focused on only ten, they could service the businesses like they had never been serviced before. It wasn’t theft, is was a reward for a job well done. To not reward them with business after this effort would be criminal.

To stay afloat, and even improve during an economic downturn find a way to earn more business. Whinning all day long that business is bad won’t do it. No that won’t do at all.

It’s the Market, Stupid!

Thursday, April 2nd, 2009

It’s not “the economy, stupid” it’s the market. Maybe the phrase should be it’s the market, stupid. Printing companies have been dropping like autumn leaves with no immediate end in sight. According to the NAPL, the future is looking “dim” (my word, not theirs). They expect that a minimum of 4,000 printers to as many as 10,000 will shut down over the next 10 years. Over the last 4 years we saw a decline of 4,800 plants with approximately 150,000 employees. Since 1994 we experienced a loss of over 11,000 plants.

What does all of this mean? It means that the current state of the economy, while rough, isn’t the real reason for the decline in the industry. That’s why I say it’s the market, stupid! Thanks to the Internet,the methods we have used in the past to communicate with one another are withering away. For example:

Newspapers: Major metropolitan newspapers have hit very hard times. Some have already closed shop and many more are about to. It doesn’t take a very clear crystal ball to see that those that continue to exist will be very different from the newspapers of yesteryear. Why? Craig’s List, and other free online classified services eroded the base revenues for the papers. Who would pay for something they can get free, and that has larger reach? Also, every newspaper now publishes their content online. You can do more on a web page than a print page–it’s more flexible. For example you can beef up your story with graphics and movies  on a web page. It’s also timely. Hot news can be displayed on the website within minutes, instead of waiting hours for the next edition to hit the streets. We have no patience.

Magazines: Reuters reports that, “Newsstand and retail sales of U.S. magazines fell 11 percent in the second half of 2008, with celebrity and women’s titles taking a hit as supermarket and drugstore shoppers cut back on spending.” Furthermore, “Fifty percent of all magazines are sold in supermarkets, and obviously those types of places took a major hit.” If the decline in single copy magazine sales is because of the economy, will we see a rebound when the recession ends? And more importantly, when will it end? Again looking through my rather murky crystal ball, I predict many titles disappearing, and those standing will see sharp decreases in readership. Printers relying on magazine printing will be hard hit.

Books: Booksellers report decreases, with the exception of Amazon Media who appears to be up. Amazon is invested deeply in electronics. The Kindle reader entirely eliminates the need for printing. Amazon has also benefited from third party sales (see my For Your Consideration Page on this blog). It is estimated that 1 in 3 books sold at Amazon is actually sold by a third party. Smarter marketing is bringing them more business. Borders reported a loss and announced they are trying to sell their international operations and may sell the whole chain.

Direct Mail Marketing: I was once told by Peter Harrison, a direct marketing expert who is now running Affiliate Crew an internet company, that “Everything that goes in the mail must be printed.” What happens when mail volume goes down? Think about it, banks and other financial organizations have gone paperless. You don’t mail in your bills anymore, you authorize payment on-line. Envelope printers have suffered because of this. Forms printers have also felt the effects. What about other direct mail campaigns? The US Postal Service keeps increasing rates as more and more direct mail companies discover other marketing avenues. The ones left in the game will  bear ever heavier a postage burdens. Once the cost of postage reaches the proverbial camel’s back, the direct mail business will be through. Kaput. What will the post office have to do then, personal letters? Even with my cloudy crystal ball it’s as easy as seeing the housing boom collapse. Really, who didn’t see it coming with overinflated prices, and interest rates at 1%?

Catalogs: I had trouble finding some figures for catalog printing, but I can tell you that the catalogs are pushing web sales more and more. If you think about it they face similar challenges to newspapers. You can just do more on-line to show off your product than you can in print. Why not video the item, particularly clothing, so you can see front, back, and side? Once holographic technology is here the public will insist on 3 dimensional views. It’s just around the corner.

Wedding Invitations & Announcements: I’ll admit that invitations and announcements have never accounted for a big slice of the printing pie, but those printers specializing in them have been hit hard. Why? It’s because people have access to paper options, graphic design programs, and digital printing. They create their own invitations with their own style and creativity.

NAPL also reports that only [are the] larger plants growing in number. Those printers without deep pockets will be swallowed by the others. It’s the law of the jungle. The downside is that more print industry employees will find themselves unemployed. What are their options in the new economy?

Like the dawning of the Industrial Age big changes are happening, but at a much faster pace. What will it be like when clouds in my dirty crystal ball clear? I just don’t know–do you?

The Internet vs Traditional Publishing

Sunday, February 1st, 2009

Today I really am talking out of my hat. With as much practical knowledge as I have acquired over the last forty or so years in and around the printing business, this Internet world is brand new to me. Not that I haven’t been using the Net for many years, it’s the jumping in, and being a presence, that is new to me.

I attended a seminar just a couple of months ago led by Phil Davis. You may have noticed Phil’s name show up on the comments to this blog. Phil owns a short-run digital printing company. He has been serving authors and printing their books for many years. It occurred to Phil that in addition to printing their product, he could be even more helpful if he taught them how to market their books. That was an excellent idea. If you can help your customers achieve success they will have the funding to do it again, and again, and again.

You’ve read in prior posts some of my thoughts on the state of publishing today, as I understand it. I don’t know how many thousands of new authors uselessly beat their heads against the walls trying to go through established publishing channels. The traditional channels are too narrow.

So there Phil was in front of a small twenty-odd-something group of authors telling them that selling through the Internet is not only the current wave but might become the only method in future book promotions. Self-publishing and self-marketing–gosh, what a concept. The new reality is that with the state-of-the-art printing capabilities a run of 50 or 100 books is viable. Even ten years ago that wasn’t true. It is now. As for Internet marketing, much of it is free. Let’s recap, you can print your book in small quantities as needed, you can market your book for free, what’s not to love?

Phil talked about blogging and used his own experience as an example. The first month of his website he got 300 hits, by the end of the year it was up to three thousand. How many fledgling authors became Phil’s customers? He won’t divulge that, and I can’t blame him. The point is that the Internet has taken the place of a whole fleet of salespeople. How many salesmen would a company have to employ to reach three thousand prospects per month?

I have to admit that I am not a technocrat. My wife chides me that if world progress depended on me, we might not have the electric light, or zippers. While that isn’t exactly true, there is some truth to it. I’m am not ever the first to embrace new technology, and I tend to learn only as much as I need to learn. Without people like Phil Davis sounding the clarion call you wouldn’t be reading this blog today.

I have to tell you, I’m loving this blogging revolution. It allows me to speak out on issues involving my profession, or anything else I want to, and I get connected with the whole doggone world! My wife added a plug-in (or is it a widget?) to my home page that shows a map of the world. It has just been installed, and so I’ve missed the previous hits, but in the last couple of days red dots have shown up from France and the Grand Cayman’s. This might not blow any of you readers away, but for me it’s a freakin’ miracle. I’m sitting here at my desk facing the Wasatch Mountains in Utah and someone in France stopped by just to read what I have to say.

Just knowing this means I have an awesome responsibility. If my words are helpful in any way, to anyone in the world, I have to make sure that every time they visit this site they can take away some nugget of value. I will make this my goal, and my pledge to my readers, everyday I’ll bring a thought, a method, or an understanding that I have to this blog. And if you readers will freely add your comments to help me keep on course, we can mutually benefit. Thank you, all of you, wherever you are in the world.

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