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Marketing Services is the Easy Answer, Just Like Buying New Equipment Always Was

Throughout my career,

By Dr. Joe Webb
Published: February 17, 2010

Throughout my career, I have always heard that print is a commodity, that there are too many printers, printers always have the same equipment, and that printers don't know how to market. There are many more, and I've dealt with all of them at various times.

This week, I was reminded of the issue because of a blogpost by Margie Dana, which happened to echo my general sentiments about “marketing services” and printers. What she describes, but may not have realized, has an economic underpinning. Businesses are defined, whether they want to be or not, by their major capital investments and their history, all of which combine with other factors to create a culture that is detected by others, even on their first interaction, even if they cannot articulate it. Therefore changing that definition is difficult.

We also know that in surveys that we have done in conjunction with the economic webinars that the business conditions of printers that state that they are marketing services providers are just as bad, and sometimes worse, than printers who do not. I have rarely found that printers who say they are marketing services businesses have any significant or sustainable economic advantage. We don't know how the early adopters of this monicker initially performed. Nor is there a good set guidelines of what clearly separates a marketing services business with printing equipment from another business with printing equipment alone. A recent post to the WhatTheyThink peer group makes an attempt.

I've already explained somewhere in these pages that print is not a commodity (a commodity is a raw material that is combined with other things to create something quite different, which makes print a processor of commodities, but not a commodity itself). The marketplace has been correcting for the number of printers for years, forcing the net exit of more than a thousand a year for a decade and a half. Technology has narrowed the variability of the printing process and its operators, and instead stored essential and repetitive knowledge and craft skills in software. This created a predictable, rising, and reachable level of acceptable mediocrity that nearly all printers could achieve. (Regarding technology and craft, just think that almost every time you click a dropdown in Adobe PhotoShop, it's probably something that would have taken more than an hour in the 1970s, used lots of film and chemicals, and would have billed out at $35/hour, plus materials).

The old saw about printers being involved in the production of sales and marketing materials for the entire economy, but printers not knowing anything about marketing seemed pretty astute at first hearing. It minimized the core capabilities and innate knowledge that our industry's entrepreneurs and risk-takers used to profitably survive in the markets at that time. I always found it to be quite the paradox in the 1980s and 1990s when executives of money-losing tech companies would lecture printers about their inability to market. The printers had long track-records of being profitable and supporting generations of family members. The tech companies had trouble surviving from quarter to quarter. The marketing efforts that those printing organizations used at that time were appropriate for their marketplaces at that time. They are not the skills needed this time, because those marketplaces no longer exist in the same way or form.

The reason marketing services is not a panacea has a similar pattern to the way the industry made its equipment investments. For almost all of print's entire history, there were limited numbers of early adopters of new technologies. In the '80s and early '90s, these folks would joke amongst themselves and their risk-averse peers that they were at the “bleeding edge of technology,” a recognition of the marketplace experimentation they were engaged in, and that it often included a period of economic loss until they got it right.

After the adopters were done, other printing organizations would jump on the bandwagon. As some would tell me, “we'll let them take the arrows and the gunshots, and then we'll jump in.” There was a mimicry, a keeping up with the Joneses, that was involved in the technology investments that printers would make. This was perfectly sane and rational: prior capital investments would usually have long lives, capital was scarce and had to be used wisely. The market was growing, which meant that there was enough business that could be competed for on a profitable basis unless one made big mistakes, even if that profit was often limited. So if a 28” press was hot, the reason was because it had been proven as safe to buy because the market for its output was proven by other printers the buyer knew. This is how our industry went from letterpress to offset, hot type to phototypesetting, film to direct-to-plate, and many other changes. This has changed, however. Consolidation means that there are fewer independent business owners that can emulate each others capital purchases. Technology changes so rapidly that the marketing life of the equipment is often less than its funtional life.

The problem with marketing services as it is often practiced is that it must co-exist with significant capital investment in print production equipment. Those investments still dominate the culture and operations of that business.

Unlike a bad equipment choice, there is no downside risk to claiming a business is in marketing services and being wrong. No one has to put a load of their own money, or agree to a bank's conditions, to say they are a marketing services business. That alone would be a barrier of entry to the business, such as preventing a printer from saying they had a heatset press in their plant because they would hire someone to stand next to their AB Dick 360 holding a hair dryer. Capital investment would create discipline to claims, as well as making the differentiation clear to everyone. If I claim to be a medical doctor and start seeing patients, I can be arrested. If I claim to be a marketing services provider, no one will notice.

The real issue is credibility. How does a client know that they are dealing with a marketing services provider, and not “just” a printer? They will know it because the printers experience in marketing services will come from using the tools of marketing services themselves. Consulatitive selling, yet another buzzphrase, is not just telling people what to do and figuring out what freelancers you can assemble and markup their individual billable tasks.

Marketing services is not part of the printing culture, at least yet. So many of our great companies came from entrepreneurs who had print production insights that others of their time did not. Those advantages were right in those times, but now must compete among media alternatives that have advantages unique to themselves.

That competition is not always easily understood unless all of a business' scarce resources are devoted solely to that cause. For that reason, I have believed that any marketing services business should be a set up as a standalone business, separate from the printing organization, with its own investment, management, and financial measurement. This prevents falling back to the familiar safety of printing capabilities (as in “we need to get some sales activity because we have a lease payment due for the press, so be more aggressive in estimating the next few days”). The shift to marketing services has to be made knowing one can't fall into a safety net; that's often more difficult for the owner than it is for everyone else.

Marketing services is a new culture, moving from a billable task or job relationship that is invoiced as completed like print, to a longer-term retainer relationship that is comprised of many services, and billed monthly, quarterly, or annually. It needs to stand alone because the culture and pace of the business is radically different, which means the staffing must reflect that difference, too. But the first hurdle is always to use the tools available in the marketing services business for one's own business, and use it in a way that proves competence, demonstrates skills of wide range and insight, and makes marketing services more than a new business card.

Dr. Joe Webb is one of the graphic arts industry's best-known consultants, forecasters, and commentators. He is the director of WhatTheyThink.com's Economics and Research Center.

What do you think? Please send feedback to Dr. Joe by emailing him at drjoe@whattheythink.com.

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