Web-to-Print, Market and Strategies
Today it is quite difficult for most of us to imagine if flight tickets should be purchased with a travel agent - not one on the internet, but you know the good old-fashion ones. Books, electronics and a hole lot of more products have found it's way to the internet and you can today buy literally everything on the net. So no wonder finding printers online as well.
Being online is a huge opportunity and of course you have to be where your customers are - and a lot of them is of course online. Some of the biggest online printers serve maybe 25.000+ customers a day and ship out boxes in volume and speed that is simply breathtaking. Unfortunately most of the online printers find price the most important KPI and therefor mostly sell on price.
The market of course continues to have a diverse approach to prices. One of my friends and online printer pioneers from Holland, René Van Dijk, once explained that when he was setting up stores, he had multiple approaches to price and service. Though it was the same company, a branch could have it's own brand, own products and prices served at an extreme low price in return for "we print whatever your submit and we don't take responsibility for quality etc....". Same company could have another brand, where prices where higher, but in return the customer could ask for support (payable), change orders, maybe even call support staff. Products where produced on the same printers, and handled by the same staff - but by offering two or more price/service levels, he could differentiate his brands and still capture a quite good percentage of the market. This approach seems quite aligned with what the market require.
With more than 100.000 printers in Europe, you should think that the market would be flooded with online printers and suppliers of web-to-print solutions, but there is still a limited number of larger online printers. A lot of these printers offer their customers simple business-card solutions or access to branded White Label solutions offered by a range of printers (100+) in Europe. The huge solutions in the market compete mainly on price - and if you really would like to see how competitive this market is, you can take a look at Druckpreis from Germany, that do, what the travel robots do to flight tickets - monitor several online printers and compare prices!
Looking at this, some printers may think - oh no - this model is not something for me, because for to many printers, commodity print really isn't worth touching - and there is NO need to go that path. Of course volume based printers, like most online printers have a business, but this is not the same, that every printer needs to make the same offerings! Every MEGA trend the past years have underscored that the bigger the commodity market become, the more interesting it is to be in the niche.
Some printers stick to their traditional KAM strategy, have skilled staff and can sell at a higher profit, since they offer their customers one-to-one solutions. Simply said, I don't believe that one-size fits all. If you are a brand owner the paper you are using is important. The accuracy and the way your colors is re-produced, needs to be aligned with brand manual etc. and to expect an online printer, that MAINLY focuses on commodity products, simple products and price - is simply not a market place that is comparable.
The problem is NOT how you sell. The problem is if you don't think about what to do, and just stick to what you have always done!
BUT.. This doesn't mean that Web-to-Print isn't interesting. Web-to-Print is much more than a pretty face or web-storefront. Web-to-Print is also a matter of offering your clients a 24/7 access to stock, to products, to templates, photos, variable data etc., and maybe even more important - to ensure that your customers isn't thinking of buying with an existing online printer, if this can avoided. It is about securing your business online as well as offline.
Web-to-Print is about understanding customer behaviour and to make sure that you have full and secure control over your customer data. It is important that you remain ownership of these data, so you can use this in your planning for the future as well as giving your historic background.
Web-to-Print is also about streamlining your operation. Orders purchased online can be invoiced directly, production can be handled mostly, without human interference and free-up resources for other more profitable things - or downsizing cost base.
Web-to-Print is something that most business owners in this industry should be interested in, simply because this is where our customers already buy or will buy in the future.
I have defined various types of web-to-print - all requires different technical solutions, different customer approaches:
- Business to Consumer (like Vistaprint at large)
- Business to Business (like our own shop.printprovider.dk - I maybe should be modest, but why not market your own GREAT service, when the opportunity is there!)
- Service Market (like O'neal Data Systems, Los Angeles)
- Vertical Market (like moo.com)
- Affiliate Market (like editandprint.com.au)
With the pyramide above I am trying to explain the market (simplified). The "Specialized" market is often print management companies, print brokers and other companies handling niches. At the recent "Grafisk Dag" in Stockholm, held by the federation of printers in Sweden - CEO Ravindra Parasnis presented a new report explaining where the real value adding companies is - and as you can see from the slide below (and a link to the org. Power Point presentation), specialized printers are more profitable and add more value, than most other traditional printers. The data is based on fiscal data over a period from 2008-2014.
The middle of the pyramid is where MOST printers today is. These are typically small-to-medium size companies and represent about 80-90% of the printers in numbers, but maybe only 10-20% in revenue. This market has been under a huge pressure since the so-called financial crisis hit the market in 2008. In a recent interview we did with Stephan Plenz from Heidelberg (Inkish.tv), he told that Heidelberg is changing focus from 100.000 customers to 10.000 customers - not that they will not serve the others, but they want to be the main supplier among the 10.000 most important printers in the world - which apparently in Heidelbergs optic is the commodity printers. When we identified the middle segment in the market and the reason why I am writing about my market "understanding" here - is because a lot of the printers in the middle segment is desperat. These printers EITHER moves to become Specialized suppliers OR to the rapidly increasing commodity segment, described in my pyramid.
If printers in the middle segment tries to compete with the huge online printers, but continue to offer the same services and personalized approach - it is a dangerous approach - and I have tried to describe it in the section of the pyramid below:
So a web-to-print solution OR a White Label solution probably isn't your solution to a problem in a sliding market - at least not, if you believe you should compete on price.
Looking at the various web-to-print solutions described above, some of these may not even be interesting in your company - maybe your solution is more radical - namely to decide in which direction of the pyramid you want to move. Ask yourself - do you have a special product that can find its way into a niche, where prices are less competitive? Do you have the capacity to compete in the commodity market? Do you have the right staff? Do you have the right management? Do you have the business plan that can support your operation and also help you to get your financing? Next week (expected July 11th) we release a new INKISH.TV episode where we have interviewed Peter Fischermann from AKF Bank and he explain that financing of equipment today isn't just about balance sheets, but also a matter of your business plan - so get started!
If you need a visual tool, to inspire and to make your business model simple to work with, I can recommend you to use the tools from Board of Innovation - really cool and really simple and really affordable.
So web-to-print is not the solution in itself. Neither is a new printer or new MIS system. Neither is a new binder or White Label partner. The ONLY solution is to find out what you want to do in the future, find out about the market potential, how to market your services and how to ensure that your company have the right fit in relation to your objectives, competitiveness etc.