Growing revenues in today’s print industry can be a challenging task. Many companies struggle to retain current operational status and profit margins as more marketing activities have shifted to digital formats and postage costs have increased. Despite these changes, top-line growth is still possible, but new strategies need to be considered to achieve it.
This blog is the first of a series where we will discuss specific strategies that can realign a traditional print and mail business to meet current demands and expectations. The first topic we will discuss is productization.
What is “Productization”?
Don’t be surprised if you haven’t heard this word before because Virtual Systems president Chris Huber made it up based on a specific trend that he has seen among successful print and mail shops.
At its core productization isn’t about print or mail directly, but about rewiring the approach to how print/mail is packaged and sold customers. Some print shops have found great regional and national success in supporting the print and mail needs of specific industries. These include:
- Auto dealerships
- Insurance Providers
- Colleges and Universities
- Service Businesses
- Commercial and residential realtors
Within each of these industries, there is a need to produce and send specific print pieces, including loyalty programs, postcards, coupons, reminders, and market updates. Rather than each business managing these processes individually, some printing companies have created templates and packages that can be customized to the demands of specific clients. This process includes:
- Creating mailers with various levels of coupons from minimal to attract new customers to higher discounts for long-term customers
- Developing and managing loyalty programs
- Managing databases and coordinating it with calendars or other relevant timeframes to assure that reminders or other notices are sent to the right people at the right time
The websites of most of the companies don’t discuss print and mail capacities or costs because they are selling a simpler concept (product) to a very focused audience. While print and mail is a component of the process, the ultimate product is a customer engagement service that requires minimum time and effort on the part of the client.
Starting a “Productization” Business
While the above list of industries may be dominated by specific players, there are a lot of opportunities still available for those willing to make the commitment. Successful companies grew into this business by starting with the basics, which are:
- Market Research. Begin by looking at the needs within your own community and identify businesses who conduct regular mailings to specific people and ask yourself if this need is local or more regional or national. If there is a broad need, this is a good place to start.
- Access Resources. Productization requires expertise in database management, marketing, and mailing design. You may have some of this expertise already in-house but don’t be afraid to hire the skills you need for success. If you don’t have someone skilled at designing flyers or mailing postcards with coupons, hire a talented and reliable independent contractor until you are ready to bring someone on full-time.
- Build Expertise. Approach targeted local businesses and offer this service. Gain experience, learn from mistakes and grow your skill set and reputation. Once you have this in place, you can expand your market to reach additional customers.
- Narrow Your Focus. As this arm of your business grows, you will reach a point where you will turn away business that you had previously accepted. Don’t shy away from this change as it reflects your success in your productization business, which will provide more profits and stability than the piecemeal work you accepted in the past.
- Productization will likely require renaming your business and developing new websites and apps. This is a natural part of the shift in your company’s goals and when you reach this point you know that you have created the right product for your targeted client base.
- Attend Relevant Industry Conferences. Print and mail shops that have successfully shifted to productization did so by renting booth space at industry conferences so they could capture a broader geographic market. Some of these companies now have a national client base because they attended conferences and marketed themselves on a new and exciting level.
- Deliver Quality. Productization relies on your ability to successfully manage your client’s print and mail engagement with their target audiences. Your work must connect with the mailing recipients and have a direct impact on your client’s growth and success. You need to be able to manage this process better than they could in-house and achieve the results they need. While this sounds challenging, most companies don’t prioritize these activities so someone who can do it better for a reasonable price is a great solution to their problem.
Benefits of “Productization”
There are so many reasons why productization just makes sense and these are:
- You can use existing staff and production capacities. Much of what you need for success is already in your shop.
- You can add additional pieces incrementally. Start by hiring freelancers to manage the pieces you don’t have and know that you can hire this expertise when you reach specific milestones.
- You can and should start small. The people who now manage pizza shop mailers for national franchises started by approaching the shops in their home town. Find the right market niche and start locally so you can develop the skills and systems you need to take the product to the next level.
- You experience stabilized cash flows. Having a set product that is modified to meet the needs of specific customers lowers allows you to develop a customer base and generate steady income.
- You can predict resource needs. Scheduling, staffing, equipment and supply demands become predictable and more manageable because of the stabilized customer base and focused product.
- You can go digital. With productization, you can add a digital component and offer your clients the ability to engage their customers by traditional mail, email or both. Rather than competing with the digital marketer, you are now both with an industry-specific specialization that will be difficult for others to challenge.
Productization is just one way to remain competitive and relevant in the current and anticipated print and mail industry. In the next blog, we will discuss the need to truly embrace social media, how to select the right platforms and what you need to do use this tool to support your business.