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Commentary & Analysis

Escaping the Commodity Trap

By Michael Josefowicz Suppose printers focused all of their experience,

By WhatTheyThink Staff
Published: August 8, 2005

By Michael Josefowicz Suppose printers focused all of their experience, intelligence, energy and resources on becoming world-class printed product manufacturers. August 8, 2005 -- For the last couple of years, printers have been running from the dreaded "C" word: commodity. The industry's problems supposedly come from the fact that print has become a commodity, quality is no longer important, price competition rules. The search is on for "value added services", so that we can escape the commodity trap. But suppose we replace the "commodity" word with a more accurate and even scarier word --product. Products are not bad things. In fact, products are much easier to buy and sell than services. Plumbers and consultants sell jobs (skills) and services. Sony, Apple, and Viking Stoves sell products. Others, like Comcast or Verizon sell products and services. Where's the Money? The common wisdom is that in the service economy, selling a service is where the money is. I think what's really happening is that the most important services make it easier to buy products. Products are amenable to modern manufacturing techniques, economies of scale, internet-based marketing and constant improvement. In short, they can be produced better, faster and with more value than ever before. For those smart enough, focused enough and strong enough to play by the new rules, this is very good news. How might this apply to commercial printers--both digital and offset? We've all heard the mantra of becoming "solutions providers" and "communications companies". Why not take this rich experience and apply it to a whole range of new printed products? For some, this might make sense. But understand that this is a very crowded, competitive marketplace. Advertising agencies, consultants, direct marketing companies, brand managers, Value Added Resellers, even IBM and Xerox are all in this game. Crafting a practical solution for the practical problems of a sizable enterprise takes the co-ordination of many skill sets, usually has a very long sales cycle, and needs the resources to succeed. Not an easy business. Change the playing field So. Instead of trying to transform ourselves into becoming "solution providers" and "communications companies", suppose printers focused all of their experience, intelligence, energy and resources on becoming world-class printed product manufacturers. The mission of the company then becomes very clear--produce printed products better, faster, cheaper than anyone else. And constantly improve the buying experience and continuously develop new products for any market that is under served. In a transparent, accountable marketplace," better, faster, cheaper" will always win. And in the wired world, customers can find out about "better, faster, cheaper" in internet time. The commercial printing industry has always had a rich assortment of jobs that have turned into products and were sold through various channels -- typically quick printers, smaller commercial shops and printing brokers. My personal favorites are Regency Thermography and Carlson Craft. Can you imagine a more customized product than wedding invitations and business stationery? You have totally ignorant buyers, under terribly high-stakes time frames, sold by a relatively uneducated sales force? And yet these companies designed a business process (would that be a workflow?), without the help of IT or websites, to profitably produce, market, sell and deliver these products. Why not take this rich experience and apply it to a whole range of new printed products? Sure there are many challenges. That's the price we pay for a free market economy. And as luck would have it, we are at the coming of age of a radically new printing technique -- designer quality digital. Totally new products are being developed every day for totally new markets. The explosion in self-published books and the ability to order personal photo albums on line are just the tiniest tip of the iceberg. Last month, I wrote about the Tipping Point happening in local places, not all at once. Innovation comes from individual firms, then are noticed by others in the marketplace and widely imitated. It's how tipping points are reached and rapid change occurs. One firm that has caught my eye is http://www.printingforless.com/. Ironically they are not digital printers. But, in my humble opinion, I think they've got most of the pieces together. They seem to understand the buyer's experience. And have put in the time and money to make it as pleasant as possible. If you have the budget, I suggest you buy even a small job, experience their follow through and their team-customer service approach. A designer friend of mine recently worked with them and it was quite an eye opener for me. We are at the coming of age of a radically new printing technique -- designer quality digital. From where I sit, I think this is a Tipping Point company. In the world of traditional offset products, they've got a great offering. In their niche of the commercial print industry, they could well become the standard to beat. Being better or faster or cheaper than them is a worthy goal. And yet very attainable. Note, that at least for now, they don't offer less than 250 copies, nor do they offer variable marketing programs, or very short run full color books. It should make sense to offer products ( commodities ) that printingforless doesn't. As long as the buyer's experience meets the standard they've set, I bet it would work. In the interests of transparency, it is important to state that this writer has no relation with printingforless, except as an observer and frequent user of their pricing mechanism for ballpark prices. If you know of a company that you think could be described as Tipping Point, please email me so that we can spread the word of best practices.

 

 

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