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Successfully Selling Wide-Format

How products, customers, competitors, and technologies play into successful sales.

One of the most important characteristics of the wide-format printing marketplace is that there are relatively low barriers to entry. Essentially, any individual or small print shop that can spend a few thousand dollars on a wide-format printer, along with the required input and finishing equipment can become a wide-format print service provider. Then, it's a matter of growing your business.

But a key factor in growing that wide-format business is the ability to actually sell wide-format printing. Succeeding takes resourcefulness. Creating superior marketing is a constant challenge for any company, in any market segment. And just like other industries, the wide-format printing world is continually faced with new technologies and products, competitors, and challenging customers.

To truly become accomplished and profitable in the wide-format business, you must address it from a sales perspective and do so by: knowing your product; knowing your market; knowing your customers; and knowing your competitors.

Product details and segment targeting
Even though wide-format specialists are selling a service versus selling one particular item, traditional sales techniques still apply. It helps if you can drive demand where there has not been demand. For instance, by showing prospects data that helps them recognize the benefits they will see as a result of more visual advertising, print service providers can drive additional wide-format printing business.

Point-of-purchase is a prime example. In a recent InfoTrends study, retailers were asked for their perspective on the effectiveness of point-of-purchase advertising. Eighty-five percent of retailers surveyed indicated that point-of-purchase graphics are either very or moderately effective at increasing sales of products in their store. This is the kind of data that print service providers should include in their sales and marketing materials because, as retailers see it-and recognize that they could be missing an opportunity to grow their sales through more and better in-store signage-this should drive more wide-format printing. Tip: Customers love visuals, so collect as much written information as possible about your wide-format hardware, software, and media. Keep your brochures handy, open them up in front of your customer, and go over the details of your product and services step by step.

And although it may seem obvious, many well-thought-out marketing campaigns are not successful simply because the print provider has not clearly identified the market itself. There are many possible customer targets for wide-format print. For instance, will you serve print buyers directly, or will your company target exhibit/display/tradeshow companies that need effective wide-format printing for their customers? Or perhaps there are local shops that will outsource their wide-format business to you? Targeting a particular segment of the industry makes it easier to address a particular set of customers with solutions that fit their business. It's also important to understand the directions within these key customer segments.

Mammoth Media (www.mammothmedia.net), just south of Boston, is a good example of a company that has identified a segment and keyed into it quite well. A growing wide- and grand-format printing company, Mammoth Media has more than 20 employees in its facilities, which include two suites in Weymouth, Massachusetts and another facility in Nashua, New Hampshire. One-hundred percent of Mammoth’s business is wide format, and the company is well equipped and quite busy.

"We have a ton of work in our backlog," says the company’s founder and president Mark Rowell. Mammoth is planning a major expansion this year with a bigger facility and additional employees.

The company's approach has been to work with brokers, not end users. "Our experience with working directly with end users has not been too great, and we really want to do more volume work anyway," says Rowell. 'We don’t sell to end users." Mammoth Media has an HP Scitex XL1500, an HP Scitex FB6300 flatbed, an EFI Vutek 2360, and an HP Designjet 5000 it uses "for proofing.' Mammoth doesn’t do a lot of marketing to end users, but it took a booth at this spring's On Demand Expo event in Boston to market its services to other printing establishments in the area.

The beverage industry is another example of segment identification. InfoTrends believes that the beverage industry is one of the leading segments in terms of wide-format print buying. But it's also true that many of the bigger distributors within the beverage supply chain produce graphics for these beverage industry customers with their in-plant graphics operations. These in-plant graphics operations are highly invested in being able to produce as much of the wide-format output as the beverage companies can order, so the direction of that segment is not trending toward independent wide-format print providers.

Customer demand, first-to-market
Another key ability that print service providers must have to effectively sell wide-format printing services is to know existing as well as potential customers-and what these customers are seeking from a print provider.

In InfoTrends' recent 'Wide Survey,' print providers were asked about the most important thing that customers demanded from them. Survey participants most commonly cited product quality (49 percent), while product cost (24 percent) and speed of turnaround (12 percent) followed. It's interesting, however, that nearly 15 percent of respondents indicated that issues not necessarily related to pure print were the most important issues to their clients. For instance, more than 8 percent of respondents indicated that the most important thing customers expect from them is new ideas, and more than 6 percent reported that overall project management is the most important thing customers expect from them.

Every business has to spend ample time examining its competition in order to determine what areas are highly competitive, and where there are opportunities to differentiate itself. How many other wide-format print providers are in the area? What type of services are they providing? Will your shop have-or can it acquire-a price advantage, or will you have to charge more? Are there services not being offered yet that you can offer?

The need for services, or first-to-market advantage, can prove to be a key success factor. For instance, in Santa Clara, California, XL Prints (www.xlprints.com) is a $3M company that specializes in grand-format printing. According to president and founder Andy Lotia, and Steve Beard, the "green print" maven at XL Prints, the company has come a long way since its start-which began with Lotia cutting vinyl in his garage 17 years ago.

Today, 95 percent of the company’s business is wide format. "We use all EFI Vutek printers and one HP," says Lotia. The company has a Vutek 5330, two Vutek 3360s, a 10-foot Vutek FabriVu, a Vutek flatbed 200/600, and an HP Designjet 5000. According to Lotia and Beard, XL Prints customers are people who want tradeshow and promotional materials. "Also, we wholesale to other sign companies. And we sell to a lot of high-tech companies, such as Intel."

Successfully marketing XL Prints' wide-format services, they say, was fairly easy: "We had the first superwide printer in Northern California, so people know us for that. In addition, we do direct mail, cold calls, referrals, etc. But most is based on word of mouth. We recently targeted 200 major prospects, most of whom are in our direct target market-within California," they explain. "And, as mentioned before, we are a wholesale provider for other shops, particularly large franchises. Unfortunately for us though, many of these shops are starting to bring superwide in-house.'

XL Prints has three people dedicated to sales and marketing. "We also deal with a lot of print brokers. The brokers usually find us through the Printing Industries of Northern California (PINC) organization," Lotia explains.

"And, in order to increase business, we’ve had to adopt green, which is huge here in California. By offering green services, we are differentiating ourselves from our competition. We market our green services by including information on sales materials and our website," Beard says.

Sales force and marketing expenditures
Whether your wide-format print business has three employees or 50, it's very important to have a strong sales force. Nearly 69 percent of wide-format printing organizations have dedicated sales and marketing personnel, according to a recent InfoTrends study. However, the employment of sales personnel was strongly tied to company size. Although less than half of the businesses with fewer than 10 employees had specific sales/marketing personnel, nearly all of the largest companies did. As you might guess, smaller companies have fewer "dedicated" sales or marketing employees because, often, the owner is the production manager, equipment operator, graphic designer, and bookkeeper all rolled into one.

Respondents in the survey also were asked about their annual expenditures on marketing as a percentage of sales. The mean percentage for all respondents was 4.5 percent, but that number is certainly lifted by the 12 percent that spend more than 10 percent of their annual sales, because more than 67 percent spend less than 4 percent of their annual sales revenues on marketing.

It's important to remember that, according to InfoTrends data, 90 percent of wide-format print shops are small companies with fewer than 10 employees and less than $1 million in annual sales-so it's not surprising that marketing budgets would be very limited. This necessitates more effective and cost-considerate marketing avenues than mass marketing with television or newspaper advertising.

With this kind of limited marketing budget, it begs the question: How do printing establishments market their services? The most common marketing tools tend to be direct marketing (71.4 percent of respondents indicated this tool) and word-of-mouth recommendations (71 percent). Another excellent way to market wide-format printing services is to donate some wide-format print services to non-profit or community organizations. Many of the people that work for these organizations own or operate local businesses that could become clients. Mammoth Media, for instance, does an excellent job of publicizing donations to non-profit or community activities, such as donating a billboard reproduction of the scene at ground zero on the anniversary of September 11.

Effective pricing
It's very important for wide-format print service providers to effectively price their services. By knowing your market, customers, and competitors, you should have a good idea as to where your pricing should be.

The chart on page xx illustrates some of the pricing that InfoTrends has found for wide-format printing projects. The yellow bar represents the highest price found, while the blue represents the lowest price found. Average selling prices per square foot vary very widely based on volume, print media used, and the concentration of print service providers in a particular area.

The most common way that companies in the wide-format printing business price jobs now is on a cost-per-square-foot basis or cost-per-piece basis. In many cases, print buyers require this approach to pricing because it allows them to try to compare competitive print bids on an even basis. However, as much as possible, InfoTrends recommends that print providers develop more of a cost-per-piece approach, which details all of the cost element that go into a wide-format print project; this makes it more difficult for customers to negotiate downward some of a print job’s particular cost elements.

Opportunity recognition
The wide-format digital-printing market is highly fragmented, hence there is no "one way" to sell wide-format print that suits all types of print shops. Some highly successful wide-format printing organizations are driven by entrepreneurs who constantly scan their local market and their customer base in an attempt to recognize opportunities to grow their business. What we can learn from these entrepreneurs is that creativity and opportunism have been key success factors in growing their business-but also that these leaders utilize a wide variety of marketing avenues to sell their company’s abilities.

Tim Greene (tim_greene@infotrends.com) is the director of wide-format research at InfoTrends, a Weymouth, Massachusetts-based market-research and strategic-consulting firm focusing on the digital-imaging and document-solutions marketplaces.

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