In the InfoTrends U.S. Production Software Investment Outlook 2014, 150 commercial printers and 50 in-plants were asked about their current and future software investments and their growth. An interesting difference was discovered when the commercial and in-plant printers, who had experienced growth, were asked what they attributed their growth to.
As you can see in this figure, when commercial printers were asked to what they attribute their growth, the top answers were:
- More services offered
- Better economic conditions
- More sales and marketing efforts
- Better technical abilities
- Focusing on niche markets
This is consistent with what we see in successful companies. A company that is successful in launching a new service has accomplished three things: (1) market research, (2) invested in the hardware, software and training in operations, and (3) training their sales people to identify the pain points and articulate the value proposition.
Another interesting discovery in this study was the fact that offering lower prices was not significantly attributed to a company’s growth. Although most sales people will disagree, there are entire books dedicated to the concept that print buying is not based on price alone. For example, there’s a book entitled, “Price Doesn’t Count” written by Gary Cohen, Vice President of LithoCraft, a Seattle-based printer. The book is filled with interesting sidebars of case histories that help support the idea that while price is often attributed by customers, it is not always their real concern or high in their decision-making process.
If it’s true that the critical success factor for in-plants to grow is offering new services, the next obvious question is which services to offer. Based on articles in trade magazines, you might guess that the services that most in-plants are considering would include variable data printing, email marketing, personalized URLs (PURLS), and social media marketing.
However the InfoTrends’ study, The Production Printing Industry in North America: Understanding Industry Transformation 2014 reveals that none of those were in the top seven answers. The study surveyed almost 300 in-plants and found a significant difference in the top services today and those considered most important in the next two years. The top services today were graphic design and database capabilities, the top services in two years are mobile and campaign services.
If the key services in-plants are offering needs to change, an important question to consider is how you are listening to your customers and how you are responding. This is something we talk about often in our presentations. There are different ways to gather information about your customers changing needs such as focus groups, face to face meetings, and surveys. In my opinion, it does not matter exactly how you listen…what matters is that you continue listening and act on that information.
Howie Fenton is Associate Director of Operational Consulting at InfoTrends. For 25 years, he has worked with in-plants and commercial printers on: benchmarking operational and financial performance, recommendations to increase productivity/reduce costs and strategies to increase value.To email click here.