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Interview

GE07: Graph Expo 2007: A Perfect Storm for Today’s and Tomorrow’s MSP!

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By Barb Pellow
Published: August 30, 2007

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The phrase perfect storm refers to the simultaneous occurrence of events which, taken individually, would be far less powerful than the result of their chance combination. Such occurrences are rare by their very nature, so even a slight change in any one event contributing to the perfect storm would lessen its overall impact.

In today’s market, I liken what is happening with customized communications solutions to a perfect storm. At this year’s Graph Expo event, you will see seven forces converge to drive the emergence of the MSP (Marketing Service Provider):

  • Vendor Focus: There will a continuation of the convergence of software and digital print equipment technologies to address the growing requirements for interactive, multi-channel, performance-driven marketing solutions. As Graph Expo attendees tour booth after booth, they will see applications that illustrate multi-channel solutions designed to drive marketing results.
  • Affordable Color: Making the transition from a PSP (Print Service Provider) to an MSP has never been more affordable. The transition to a marketing services model isn’t a “chicken and egg” conundrum. Digital color presses are clearly an enabling force that is driving the market. Organizations can now affordably colorize critical marketing materials and key promotional messages to capture a customer’s attention.
  • Software-as-a-service options: Software suppliers clearly understand that transforming into a marketing services provider requires a Software-as-a-service (SaaS) model in addition to traditional software purchase alternatives. SaaS is a model of software delivery where the software company provides maintenance, daily technical operation, and support for the software provided to their client. Investing in a SaaS model frees the marketing services provider to do what it does best. At Graph Expo, you will see an emphasis on solutions where the marketing service provider can build out the right product and services portfolio, leveraging the high-quality and reasonably-priced SaaS solutions that are available. The benefits are present in hard and soft dollars. Hard-dollar benefits can be derived from the costs associated with implementation, maintenance, personnel, and software licensing. Soft-dollar benefits are associated with time-to-market and the ongoing investment required to keep pace with technology.
  • Expanded software feature sets: The solutions you will see demonstrated have new and unique feature sets that are designed to meet the needs of the Chief Marketing Officer. Chief Marketing Officers have one of the most precarious jobs in the C-suite. Today’s CMOs face the conflicting challenges of new distribution channels, a 24/7 global economy, pressure to deliver identifiable ROI on their marketing spend, and the need to deal with rapidly evolving technologies that are changing the face of marketing. Software suppliers at Graph Expo are enhancing applications so that the MSP can measure, monitor, and communicate the true ROI associated with marketing campaigns.
  • An emphasis on workflow efficiency: Software and equipment suppliers are focused on super-efficient workflow for customized communications. They are providing integrated, end-to-end solutions that support reduced operational costs and stem the trend toward dwindling margins. In parallel, vendors are delivering tools to boost the top line so MSPs can expand the portfolio of services they offer to their clients.
  • Education and business development support for making the PSP to MSP transition: Hardware and software suppliers are focused on educating the marketing service provider and defining a pathway to profitability through business development offerings. They are enhancing programs that consist of resources and tools that will help educate marketing service providers on identifying customer opportunities for digital printing, variable data, and multi-channel marketing as well as equipping them with the right services and solutions to better serve new and existing customers
  • Consumer demand: Finally, end consumers want more relevant communications. InfoTrends’ Future of Mail study confirmed that consumers want relevant and personalized communications—more than 60% of respondents expressed a preference for direct mail as the primary method of contact for marketing. The end consumer wants this communication to be relevant and meaningful to them.

So what is an MSP?
While traditional print will always be important and requirements for offset and short run on demand printing will remain strong, we are seeing the transformation of a number of PSPs (Print Service Providers) into MSPs (Marketing Service Providers). MSPs are attempting to participate in the more lucrative marketing value chain by providing an array of services in the marketing process from campaign inception to program execution.

The MSP understands that to participate in the value chain, good data and relevant messaging reign supreme. The MSP knows that success links to the creation of one-to-one communications that are based on a deep understanding of the customer’s needs. MSPs are implementing the infrastructure (technical, sales, and consultative skills) to develop solutions for efficient communications.

An incredible volume of information is flowing into our increasingly complex world where people are already strapped for time. People are seeking to get only what they need, quickly and efficiently, and move on to the next task in their busy day—they actually want less information! MSPs are enabling marketers to build a loyalty with clients to deliver the information that consumers want, when they want it, and eliminate some frustration from their hectic and demanding lives.

The MSP is focused on four dimensions of marketing relevancy in the solutions that they provide to clients:

  • Relevancy in Content: Providing the right information in the right context
  • Relevancy in Contact: Providing this information to the right people
  • Relevancy in Channel: Delivering this information to the right device in the right format
  • Relevancy in Time: Providing this information when and as needed to meet the client’s needs

Firms with decades of experience in prepress and offset printing are repositioning themselves as marketing services providers. These organizations are leveraging the talent and techniques to pioneer some of the world's latest marketing technologies. The emerging MSP portfolio includes:

  1. One-to-one ROI-driven multi-channel relationship marketing solutions that are designed to individually communicate with clients’ best and most profitable customers, create unique and customized messages across multiple channels, manage campaigns, track expenses, and calculate ROI in real time.
  2. Data modeling and data mining to determine this "sweet spot" based on specific criteria established by data experts. Profiling factors such as demographics, product affinity, lifestyle, and cluster analysis enables the marketing service provider to model existing customer data against scrubbed national consumer files, extracting important and relevant demographic and lifestyle data. This means that clients can model the trends and traits of their best customers, and then use that ”model” to find thousands more just like them.
  3. Web-based print solutions for remote access to digital assets for distributed sales representatives as well as agents and franchisees. These online storefronts are custom-designed for client organizations. They provide marketers, salespeople, and even customers with 24-hour access to digital assets. Users can customize the pieces, then have prints delivered on-demand or downloaded immediately.
  4. Digital asset management systems are in place to house clients’ assets (graphics, logos, templates) and allow secure access to approved users regardless of where they reside and what they want. This marketing management tool ensures the proper use of brand assets, consistency of communications, and immediate response to materials requests—24 hours a day, 7 days a week.
  5. Mailing and fulfillment includes more than just the operational aspects of getting a piece into the mail. MSPs have become trusted advisors in the face of postal rate increases. They are working with clients to minimize the impact of postage increases while maintaining response rates. MSPs consult with clients to discuss options such as modified packaging, address quality, barcoding, delivery point verification, volume discounts, and other money-saving ideas.
  6. It goes without saying that the client expects best-in-class prepress and print production using offset or digital technologies. In today’s market, these are “table stakes.”

A Reality Check

Some service providers are aggressively making the move to MSPs. As I surfed the internet, several firms emerged as organizations that were making this transition.

New Hampshire-based Verimillion tells its clients, “We’re more than a printer… we are a marketing partner.” The company works with clients to find, attract, retain, and grow new business with increased effectiveness and reduced costs. Its offer is the combination of marketing strategy, creative development, and professional production with leading-edge technologies to create marketing communications solutions that exceed expectations and deliver greater ROI.



MSP Digital Direct, a division of 50-year-old Mailing Services of Pittsburgh, leverages the core competencies of its parent organization, including a strong IT infrastructure and enough direct mail expertise to produce and mail 400 million pieces of direct mail per year. MSP Digital has developed a complete marketing services portfolio linked to the latest in digital printing and electronic communications technology to deliver integrated, highly personalized 1:1 marketing campaigns, Web-to-print solutions, collateral management programs, personalized URL campaigns, and e-mail marketing campaigns.

While some readers may question the reality and even the need, a perfect storm is on its way. The convergence of consumer demand for relevant information, technology, and the needs of the CMO are combining to have a powerful market impact. Over the next few weeks, I will be providing Graph Expo coverage on existing tools that are available and technology advances that will enable transformation from PSP to MSP. I will also share discussions with organizations that are on the path to becoming true MSPs.

A digital printing and publishing pioneer, marketing expert and Group Director at InfoTrends, Barbara Pellow helps companies develop multi-media strategies that ride the information wave. Barb brings the knowledge and skills to help companies expand and grow business opportunity.

Please offer your feedback to Barb. She can be reached at barb_pellow@infotrends.com.

 

 

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