Industry Consultant Bob Raus sent in his thoughts on the current state of the industry and what he says is our "fight for long-term relevancy." He says to stay relevent we need to "reposition print for a new generation of decision makers." Is Bob on target with his assessment? Here is what he wrote:
Print Engine: Abdicate The Throne
The printing industry is in a fight for long-term relevancy. Factors such as e-delivery, Internet statements and bills, postage rates, “don’t print” green initiatives, instant information access, and more are legitimate causes of page volume decline. However, I believe this mess is largely our own fault.
While many industry experts tell print service providers they must transform their businesses into marketing service providers, major manufacturers continue to regard the print engine as the center of the business universe. There is no doubt that print quality and speed are important. However, future sales results will increasingly depend on delivering value beyond marks on paper to sophisticated e-marketing and IT-centric decision makers.
Reposition Print For A New Generation Of Decision Makers
This relentless devotion to printed output and print engines causes the industry to be viewed as slow, static and antiquated by today’s iPhone and “Crackberry” using decision makers. In these circles, printing anything can be considered environmental genocide, old fashioned and outdated. The fact is that (gasp!) the printer is a peripheral to the computer and the computer has always been king.
In this time of crisis, our leaders must help re-message communications to project a 21st century industry persona. Continuing to promote print heads, speeds, feeds, and inks as king will result in increased distancing and irrelevancy in the eyes of savvy e-centric CMOs, CIOs and agencies. Truly embrace, promote and fully implement IT-centric solutions marketing and sales practices. Don’t stop making great print engines, just actively market them as a valuable part of the new IT-centric communications model.
Never Waste A Good Crisis
As an industry, we need to move further up the entire communications value chain by articulating how print compliments e-marketing to drive results. Personalized URLs and TransPromo communications are a good start. To truly reposition print, we must actively create and commit to solutions (not product) marketing and consultative selling practices – while minimizing elongation of the sales cycle. Rest assured, solutions will drag print engine sales – and at higher margins.
Finally, let’s not forget the sales force. To sell solutions and keep Wall Street happy quarter to quarter, suppliers to the industry must invest in the creation and widespread adoption of consultative selling practices – now. Sales teams need new sales models, training, innovative IT-centric sales tools, revamped compensation structures and unwavering leadership to drive behavioral changes. This requires bold, new thinking and execution. Luckily, there are many smart, talented, true leaders within the vendor community who are fully capable of delivering the change needed – if they chose to.
Discussion
By M. Scott Berry on Jun 08, 2009
Very nice article on the industry's long term relevancy. I would issue one challenge to those enjoying this article. Find your company's solutions and replicate them. You cannot migrate from being a "printer" to a "solutions provider" unless the company and the clients understand what solutions you provide. Too many companyis are not recognizing the creative, customer centric solutions that their own sales and operation teams have created during the past 5 years. Creating "solutions that customers want; that make money; and are replicatable... is difficult and time consuming. Look inside your organization first for proven, winning solutions. They are there...even if you only see yourself as a printer today.
By Michael J on Jun 08, 2009
M Scott,
I think you've got it just right.
It turns out that Print is and always has been the best push media. The web is a pull media. Posters, newsletters and postcards are the best ways to explore new territories and give people a chance to see stuff that they don't know that they are looking for.
Remember the huge boom in the industry when the web first scaled. The number of mailers and packages for AOL alone kept many printers busy for months.
As for becoming solution sellers, my 2 cents is that first solution they should sell is to make it a riskless pleasure to buy print. Only pafter solving that problem, should any attention be paid to others.
Printers as an industry have probably the worst record of marketing their own services. After solving the print purchasing problem. They should work on marketing their own company.
Once they get those two right, then and only then, should they try to sell marketing solutions ot others.
By Patrick Henry on Jun 08, 2009
Will somebody please explain to me why printers should be expected to listen when "industry experts" urge them to transform themselves into "marketing service providers"? What the heck is a "marketing service provider" anyway? When did being a print service provider stop being good enough? That's the implication when you go around telling people that they need to "transform" themselves.
By Michael J on Jun 08, 2009
I'm with you Patrick!
Based on what I read at your blog, the trade printers keep doing fine. They are 100% focused on being great, efficient, easy to work with printers.
Being 100% great at one thing, is much better than being 50% great at two things.
By Chad on Jun 08, 2009
I can see where you are all coming from. I think that the optimum solution lies somewhere in between printers being open to metamorphosis but also remaining true to being a printing business. I think that ultimately, printers are a building block of all other industries - no matter how great the shift is to online marketing, there will always be a reliance on print marketing. Nevertheless, it is essential, if print companies are going to thrive in these tough economic times, to be flexible and open to adjusting to the need for new technology. My horizons were challenged when I recently came across a company that offers same day, print-on-demand service. This is finding a way to meet the needs of clients that are living in an increasingly fast-paced world - http://www.digitallizard.com/index.php The time has come to find creative technological ways to meet unique needs in the market.
By Michael J on Jun 09, 2009
Chad,
I think it's not a technical problem as much as cultural problem. Printers are notoriously self protective, defensive and arrogant out their defensiveness. Many still believe that if they share what they've learned it somehow helps the "competition."
The obvious path is to network or partner with people who already do complementary functions. That's always been the model of the successful trade printers. But trade printers never had the status of the "direct printer.' And print brokers had the lowest status of all.
Meanwhile, trade printers are doing fine, and printing brokers have morphed into business process outsourcing.
By Noel Ward on Jun 09, 2009
Printers don't necessarily need to become marketing service providers (whatever that is) but with the possible exception of trade shops, printers must do more than sling ink or toner onto a page. The game has changed.
Printers who have reinvented themselves by adding variable content to documents or producing very short runs of versioned or customized documents are able to offer a wider range of services that have brought in new business. Others have adopted new cross-media techniques that are proven to work, fill a customer need and still require printing. These all require a lot more skill and knowledge than just sending a file to a CTP device or hitting "print" and doing a short run of something.
Adding such capabilities requires printers to think about their customers' needs from a marketing perspective, which is not a bad thing. It's just another part of understanding the customer's business and finding a way to help solve their business issues.
The game is changing, and printers need to adapt if they are going to survive. They don't need to become marketers, but they need to understand how they can play a more active role in the marketing process than just throwing ink on a page.
By Patrick Berger on Jun 09, 2009
A huge problem is the devaluing of print by the big trade printers.
15 years ago
1,000 4 color business went for $125.00 today $9.95
1,000 4 color brochures $450.00 today $99.00
When any print buyer of any kind goes on the internet and sees price differences of up to 500% what message does he get?
By Michael J on Jun 09, 2009
Patrick,
I think the message they get is that there a low cost producers and not so low cost producers. The advancements in technology and the increase in the market size with non professional buyers have made differences in quality a non differentiator.
Given that competition is now national, I think it means that those who are low cost providers should do ok, as long as they are really low cost, as opposed to fooling themselves by being below cost.
Noel-
I have to agree with "printers must do more than sling ink or toner onto a page. The game has changed."
But I have to disagree with the notion that the only path to success is to reinvent oneself to add new variable data products. The other well worn path is to focus on lean manufacturing and streamlining both the production process and most important the sales process.
The new unavoidable pressures on margins means ever lower costs of production, sales and unnecessary overhead. The same pressures will be in effect with variable data printing, which is becoming mainstream. The more mainstream it becomes, the great the margin pressures.
A better approach in my opinion is to stop trying to bring old stuff to new buyers and focus on bringing new stuff to old buyers. The old buyers are a defensible advantage because they already trust you. Customer acquisition costs are usually much higher then customer retention costs.
So, figure out custom crafted solutions for your present book of business to create low cost but high margin products to offer them.
By surftherock on Jun 10, 2009
How exactly does lower costs on sales translate or get lumped into cost of production and unnecessary overhead, the sales end of printing has already been streamlined with the use of the internet, faster turn around on proposals and elimination of bloated expense accounts. I guess my question is how exactly do you lower sales costs?
By Michael J on Jun 10, 2009
One way to lower sales cost is by making salespeople's time much more efficient. The Web2Print blablabla is good for large scale low cost providers with a huge reach. For everyone else the sales person is the secret suace.
One approach is to get the sales people to take the present book of business and divide them into prospects - everyone who has asked for an estimate. Then customers - everyone who has done one job and paid their bill promptly. Then clients - people who have a done a number of jobs over a set period of time and paid their bills.
Then the sales process is to do the least thing possible every day to move from lower to higher categories.
The other thing is to recognize the fact that printing is not sold. Printing is bought. The best you can do is be top of mind when the printing event event is about to happen. Then respond within a couple of minutes to say "yes this is an interesting project.. Then to respond within 6 hours with the proposal and the quote.
The tough part is that the more your sales people call to stay top of mind of the customer, the more the customer gets aggravted.
There are lots of possible print based solutions. One is a regular newsletter. Another is what I*'m calling clickable postcards. You can see what I mean at http://clickableprint.blogspot.com
By Noel Ward on Jun 10, 2009
Michael J,
We actually agree. The variable data or other "new" stuff is what has to be brought to "old" customers. What a printer must be able to do when necessary is move up the food chain at a customer to reach the right person who will "get" the new stuff, as it may not be the buyer they usually deal with.
And to Patrick Berger's comment on devaluing of print, I have ask, why should a 4-color biz card or basic 4/4 brochure cost very much? There's not a lot of value to be added to these items as static pieces and they really are commodities. VistaPrint gets my business because they are fast, cheap and deliver a good quality commodity. They are very tough to compete with.
Such general types of printing are inevitably going to continue to decline in both margin and revenue, and I don't think it can be prevented. It would seem that to combat this a print provider either has to get a lot of commodity volume and have a very fast and lean workflow or find ways to add value and services. The printers who do this seem to be more successful than those that don't. At least so far.
By Patrick Berger on Jun 10, 2009
You can always find a place that is cheaper.
How do you value the one to one face to face contact provided by the local printer?
It use to be the customer comfort zone supplied by the printer. Checking files or designing, going over proofs discussing the project and what is it's intended use how to optimize the project to better fit the budget.
Now just send a file and in a few days it comes back finished. Now the responsibility of the whole project rest on the customer who sent the file. There is very little human interaction. The feel good comfort service provided by the local printer has gone away.
By Michael J on Jun 10, 2009
Patrick,
What if it turns out that the one to one interaction is a bug not a feature? I know of many busy, busy people who don't want that interaction. It's the same people who would prefer to buy from Amazon rather than a store exactly because of the clear well defined interaction.
On the other hand, if the salesperson really adds value by making a complicated purchase easy, pleasant and risk free that's a different issue.
In the old days, printers supplied production insurance. These days production insurance is supplied by the process.
By Patrick Berger on Jun 10, 2009
You are right production insurance is supplied by the process.
It won't be long and we won't need advertising agencies or promotional consultants.
Customers can make their own content online, submit it to an online printer and bingo they have just become an agency print broker.
The production insurance is still there, the content insurance is gone.
By Bob Raus on Jun 10, 2009
These are all good comments and I'm interested to also hear thoughts on three points in the article I don't think have been addressed yet:
1) printer manufacturer’s focus on the printer engine (dpi, speeds/feeds, inks, print heads…),
2) the fundamental misalignment that a marketing focus on printed output causes with today's CMOs/CIOs,
3) the need to create new sales training/tools that focus delivering on communications solutions – (and printed output).
Agree/disagree?
By Michael J on Jun 10, 2009
Bob,
Since you asked . .
1. I think manufacturers should pretty much stop most of the advertising and "educating" they are doing. During the evangelist stage of digital printing their extraordinary investment was necessary. But that stage is over. Focusing on equipment that can be upgraded instead of replaced would be a great help.
2. CMOs care about getting data on their customer's behavior. If print, through transpromo and other print connecting to web can produce that data they will be happy to buy it. The idea that a printer can teach a marketer how to get better ROI never made sense to me. Growing top line revenue always makes sense, in any context.
3.The need is for less sales training tools and more mentoring of young salespeople by experienced sales people. As for follow up and all that other necessary stuff, salesforce.com has a well defined robust platform. If training is needed, it should be training in how to use salesforce.com to sell print.
Iu think salesforce.com has an affiliate resellers programs. My humble opinion is that if consultants got paid from that affiliate sales or incentives tied to getting more work in the door, things would all go a lot smoother.
By Bob Raus on Jun 12, 2009
Hi Michael J. Thanks for the latest comments. Now it gets interesting because I disagree with nearly everything you said.
1) I believe that printer manufacturers MUST rebalance marcom efforts to increase promotion and marketing of IT-centric (not printer-centric) solutions. The alternative is for their marcom departments to continue the paper/printed output messaging that leads to increased distancing from today's e-Centric CMOs and CIOs. The complimentary nature of print in a multi-channel world must be emphasized via IT solutions messaging - or the industry is doomed to be viewed as “paper-lovers” and outdated - no matter what the print quality, speed or upgrade path is.
2) I agree that “CMOs care about getting data on their customer’s behavior.” TransPromo can contribute to this result. However, I feel that since the term TransPromo is overwhelmingly associated with the printing industry (i.e. the production of paper output) that it is tainted with the stigmas I mentioned in the first paragraph of my article. Riding the TransPromo message as a vehicle for increased campaign results is like pushing a rope. The industry must find ways for IT and CMO executives to PULL print into their campaign mix by promoting multi-channel communications that INCLUDE TransPromo. Let us all say it out loud please: “Campaign data is managed, developed, composed, output, collected and analyzed BY THE COMPUTER that drives the print engine peripheral.” Once we embrace this fact FULLY – we can create new marketing messages that compliment the IT systems from a solutions (not box) perspective.
3) The idea of less sales training and more mentoring of young sales people is flawed big time – because the majority of sales people in the industry today are relationship sellers – not technology sellers. We don't need this behavior to be emphasized going forward. While these folks are great at what they do, I’ve heard many (hundreds?) throughout my career talk about how they depend on the local software engineer/analyst to cover the technical stuff when it comes down to the details of what is proposed/sold. I’m not saying we want all our sales people to be technical “bit-heads” either. However, the market has evolved to the point where we need sales people to focus on reengineering the customer’s business processes. This can’t be done by selling boxes or just having great relationship skills. It must be approached by using software, services AND print engines (plus many other things too). Learning about salesforce.com is fine from a sales efficiency perspective - but the first priority is to train sales people (not just SEs/anlysts) to document, analyze and understand the customer’s business problems and workflows – which some - but not nearly enough sales people can do today. Most importantly, they are not typically required or compensated to do this today by their management teams.
By Jean-Marie Hershey on Jun 12, 2009
Generalities are odious. What I find disconcerting in all this speculation about the long-term relevance of the printing industry as a whole (the premise of the original post) is that no mention is made of the role conventional (offset) printing technologies have yet to play in shaping this brave new industry world. The last time I checked, this still vital segment of our industry generated billions in shipments worldwide. Seems to me this makes it pretty "relevant." To pretend that it doesn't exist or will soon cease to exist is to skew any argument about the "long-term relevance of print" into irrelevance in and of itself.
By Bob Raus on Jun 12, 2009
Hello Jean-Marie! Thank you for the excellent input here.
It is clear that offset printing is a vital part of the global economy and I did not mean to negate its importance in any way in my original commentary. I would point out though that offset is also dependent on the computer because all offset plates today (in developed countries) are created using Computer To Plate (CTP) devices.
Please keep in mind – that I love print too! My purpose in writing the initial article is to present a perspective that grounds us all in the reality that current-and-past outbound communications from the print industry tend to be myopically focused on printed output and print engines (dpi, lpi, inks, print heads, print engines, speeds, feeds, paper stocks supported, finishing, etc.). I recognize these are the characteristics of the products we sell – but they in themselves are not the VALUE we sell. The value is the ability of these communications to elicit the desired response from the reader/audience.
The relentless marketing focus on paper output is causing the industry to loose relevance with today’s e-communications centric decision makers – who will become even more e-centric going forward. To align with (or at least not alienate) these decision makers, and combat this increasingly self-inflicted irrelevancy, I am proposing that this industry needs to fully embrace an IT-centric solutions approach to outbound communications featuring software, services – and the (CTP, digital or offset) print engines - in that order- for 80% of our outbound communications.
By Michael J on Jun 12, 2009
Bob,
I agree. We have now entered the wonderful marketplace of ideas, so . . .
1. 1) I believe that printer manufacturers MUST rebalance marcom efforts to increase promotion and marketing of IT-centric (not printer-centric) solutions.
If you are talking about the globals I still think they should mostly radically decrease anything they do in marcom. Instead they should invest in innovative proof of concept projects that combine the best of offset and digital to conduct experiments that produce scientific data.
If you are talking about PSP, first most of them don't have serious marcom departments. And if they did trying to sell technology is much harder than trying to sell printing. At least that's what they ( a couple of full time very highly paid consultants in the technology business) tell me.
2. 2) I agree that “CMOs care about getting data on their customer’s behavior.” TransPromo can contribute to this result. However, I feel that since the term TransPromo is overwhelmingly associated with the printing industr
Actually according to data I read over at TransPromo live only 35% of CMO's have ever heard the word. And those who have probably don't have very strong associations with it any way. I've been on a little soapbox for a while saying it's a buzz word in the bubble that we printers live. Outside that bubble it has no traction. After a year of blablabla I think it would behoove us all to realize that the market has spoken and we should move on to something else.
I would like to nominate that idea that a printer can show a CMO a path to get to predictive analytics. Every CMO knows they need predictive analytics. Very, very few have even the beginning of a clue as to a path to get there.
If we are going to use a buzzword, why not use the buzzword our customers think they understand. It's still a very ill defined term. But since they have the money let's use their ill defined term instead of ours.
Re the stigma of print. That's their problem, not Print's problem. Their business are falling apart and they have to blame something... and thus Print is Dead blablabla. Sorry I don't buy it. If we don't believe that Print, digital and offset are the best media on the planet, why should anybody else.
3.3) The idea of less sales training and more mentoring of young sales people is flawed big time – because the majority of sales people in the industry today are relationship sellers – not technology sellers
Yup. It's not a bug it's a feature. Technology has ever lower margins. Just ask HP trying to sell enterprise management software and competing against Google and Open Source.
The only defensible value of every commercial printer or any other business for that matter, is in the continued trust of their clients. It's why I think printers should stop worrying about new customers and focus on making sure their present customers love them. Yes, I do mean love them.
The way I love Google, and more and more people love Apple. From love you can make good margins. Everything else is a rat race.
And......back to you.
By Michael J on Jun 12, 2009
@ Jean-Marie,
I think you are spot on. Rupert Murdoch just finished building the largest, most efficient newspaper plant in the world ( Not sure if it's really the most. But I tend to err on the side of hyperbole)
Does he know something that no one else does?
Meanwhile trade printers are doing pretty well. And web offset is by far the best, cheapest way to get a message into the real world.
It's just more "end of print" blablabla and the "sky is falling."
By Bob Raus on Jun 15, 2009
Michael J:
1. To clarify, I am speaking of global product manufacturers. I’ve been there and guarantee they are all conducting loads of research and generating lots of scientific data already. This data is being analyzed and evaluated by research teams, product management and business development groups today in order to develop new and innovative products for tomorrow.
While one could argue that they can always do more research, in a market where there is significant competition, the idea of radically decreasing marcom spend is infeasible and counter productive to generating sales (which fund the R&D initiatives). Decreased sales are bad.
2. I agree that TransPromo is a buzzword in the printing industry bubble. I believe one major reason for low recognition of the term TransPromo outside of the printing industry is that it is fully associated with printed output – and this is causing e-centric CMOs and CIOs to actually distance themselves from TransPromo. At the same time, I suggest that we should not give up on TransPromo, but step back and remessage it on software/e-centric marketing programs – that happen to also output to print.
We need new ideas via NEW (marketing) thinking in our industry to generate new interest in print. This thinking needs to be synchronized with the e-centric CMOs and CIOs of today. If anyone doesn’t believe me compare the performance of a traditional commercial print shop to Mimeo and VistaPrint for the past two years. (nuff said?)
3. Your idea that commercial “printers should stop worrying about new customers and focus on making sure their present customers love them” is flawed because it 1) assumes the market demand from current customers remains the same – or grows and 2) that you never loose a customer to competition. Yes, I agree with the idea of gaining wallet-share from highly-satisfied customers, but every company needs to actively pursue new customers to grow and thrive. This pursuit is via marcom and sales activities. These activities (messaging, campaigns, sales techniques…) must align with the needs of new target customers. In today’s world that means aligning with e-centric CMOs and CIOs.
By Michael J on Jun 15, 2009
David,
It makes sense. Re 1: The problem is that the research does not get shared with printers, as far as I can tell. The only exception is the work that InfoPrint has done with the CMO. From my point of view, I think that is a model that all the vendors would do well to replicate.
I think for now it is best to agree to disagree about the usefulness of Marcom. If we get a chance to meet sometime, it would probably be a lively and very interesting conversation.
Re 3: The reality that I know is the word of mouth is the best marketing. Happy customers become evangelists. They are the best and cheapest way to get new customers. Unless you are competing on price - a la Vista - the cost of change from one printer to another is not not perceived as worth the benefit of the switch.
Back in the day, my strategy was stay top of mind, get the designers who love you tell other designers and be ready to move very fast when another printer is too late with an estimate, a paper sample or the job itself.
If you include viral marketing driven by evangelist customers, then we agree. But if that is not the idea, then I think it goes into the agree to disagree column.
By Bob Raus on Jun 16, 2009
Michael J,
I agree to disagree. I appreciate the debate and suppose we are experiencing a traditional difference between the corporate and academic worlds. I look forward to meeting you in the future where we can no doubt consume hours at a nearby pub debating this at greater length.
I welcome additional comments from other readers and thank those who contributed for their input. With 25 + comments, I believe this was a topic worth sharing.
By Michael J on Jun 16, 2009
If you ever near Brooklyn, get in touch. I'll buy the first round.
By D Gordon on Jun 16, 2009
Jean from a guy who sells printing presses I could not of said it better. The future in print will still be on commercial offset presses however the flavors and applications of specialty print will be a very big part of the way the print delivers the message.
By Doug Rawson on Jun 17, 2009
I believe we are kidding our selves and are going by the way side. A Newsweek columnist complaining about Amazon said (6/15 page 27) "The great myth of the digital age was that once we got rid of those expensive printing presses costs (of publishing) would come down".
We are in grave danger of being the buggy whip manufactures that dismissed cars as unreliable and too expensive and the photographic film manufactures who dismissed CtP in 2000 saying film would be in the printing industry for another 15 years. They were both wrong.
While demand for print will always remain, the question is - how much. My answer is much, much less and it's never coming back because people, young and old, will read off a screen - computer, cell phone, and of course Kindle - just purchased by my 90 year-old father.
By Dave Bahls on Jun 18, 2009
Doug,
You hit the nail on the head. I have personally seen what you describe happen with my own clients in the last year and a half. I believe this is a trend and not a fad. As I have heard many times, this is a start of the slow decline of print. I agree that the demand will always be there, but not even close to what it used to be.
Discussion
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