Commercial print distributors offer a full line of print management services to create a profitable edge.
When it comes to commercial print, distributors say that substantial profitable margins are not found simply in the print production of four-color materials. Rather, providing customers with complete print management solutions—from ideation and design to logistics and warehousing—will give distributors the winning edge.
Faisal Ahmad, president and CEO of Dallas-based USFI, said that the company was founded in 1984 as a traditional forms distributorship, but eventually evolved into a full-service marketing communications company. "We are in a changing market. Industries are looking for much broader solutions than forms or even traditional commercial printing," he said.
Ahmad noted that USFI provides complete end-to-end solutions for its commercial print clients. "We begin by developing strategies. We execute graphic design elements, and we also provide warehousing and logistical services, as well as inventory management," he explained.
Founded in 1988, Pittsburgh-based Communifax, a provider of fully integrated consumer marketing programs, provides traditional commercial printing for large retailers. The company began developing loyalty marketing programs, and soon evolved into a direct marketing company, offering clients a host of business solutions, according to founder and CEO Jeff Battin.
Much like USFI, print management for Communifax includes a selection of services. According to the company, the process begins with a thorough evaluation of clients' needs, followed by marketing research and a competitive analysis. "Today, about half of our employees work in our analytical data group," said Battin. "We manage large databases of consumers for our clients."
When it comes to generating new commercial print customers, Ahmad and Battin employ a variety of creative techniques. "We gain many of our new customers through referrals and by presenting seminars to various business groups," explained Ahmad. "While these seminars are informative for attendees, they also serve as excellent public relations opportunities for us," he said. "Targeting companies that do a fair amount of commercial business, such as the retail and real estate industries, has also proven effective."
To aid in lead generation efforts, Communifax targets mid-level managers at top retailers in the United States with a unique game promotion. Its patent-pending O2O (offline to online) program was designed to "reach prospects with highly targeted offline media and drive them onto a promotional Web site to play an instant-win online game," explained Battin.
"When this happens, they are opting for future e-mail communication from us," explained Michelle Hicks, director of new business development and marketing at Communifax.
Communifax's current promotion, used to attract new customers for the company, involves a mini pizza box that accompanies a brochure and includes a game piece. "The brochure directs prospects to a Web site to play a game and win a free Domino's pizza and a two-liter Coke," explained Battin. "The players fill out a mini survey, which serves as a prequalifier, allowing us to track them," he added. Battin said that the program has yielded a 10 percent to 30 percent response rate.
It's one thing to get new customers, but quite another to retain them. In order to ensure repeat orders, Ahmad said that in most instances, USFI insists on managing clients' inventory. "Taking this proactive approach makes it easier to get repeat orders, as opposed to having clients come to us when they are in a crisis and need a rush order," he explained. "If we control the inventory, we will more than likely control the reorder."
Selling Smarts
As for tried-and-true sales techniques, Ahmad said that USFI approaches every sales opportunity with a broad view. "We typically do not approach clients to simply provide printing for them," he said. "While we may end up with just a print job, we also let clients know that we can provide all aspects of the job, including strategy planning, design, logistics and warehousing," Ahmad explained. "Many companies do not have the internal resources to perform these tasks, so if they find a company that can take on these responsibilities, they generally pursue the opportunity."
For Communifax, following up with prospects who have played its games or responded to a direct mail piece is part of its sales strategy. "Our goal is to set up a conference call with prospects and bring in our strategic sales team to assess their needs," explained Battin. "After the initial conference call, within a few weeks, we provide them with ideas on how we can solve their problem. They either purchase our services or they don't."
When it comes to frequent orders, distributors agreed that commercial print orders for direct mail are most popular. However, they also said that the order type depends largely on a client's target audience. "An organization that markets to consumers will be heavily into packaging inserts, and point-of-purchase and point-of-sale items," said Ahmad. "However, an organization that targets other businesses may prefer pocket folders with inserts."
Battin agreed, "Promotional direct mail is a large seller for us. We do large volumes of postcards, tri-fold pieces and letter packaging for retailers who want to attract new customers to their retail locations."
Changing Times
As times have changed, distributors say that their customers' commercial print requirements have also changed. "Most of our customers are capitalizing on the 'less is more' concept," noted Battin. "We do a lot of four-color work with large, captivating copy to attract attention."
According to Eric Zilling, chief marketing officer at Communifax, the Internet is a catalyst in changing commercial print needs. "Prior to the Web, a direct mail piece included all of the sell copy, as well as response mechanisms," he said. "Today, with so many consumers online, our challenge is to capture consumers' attention with the mail piece and drive them to a Web site, where the sale can be completed in a more structured environment."
With commercial printing accounting for 60 percent of USFI's total revenue ($15 million annually), Ahmad said that the medium is responsible for all of the company's recent growth. "We may be subconsciously orienting ourselves toward commercial print," he said.
Battin said that 65 percent of Communifax's revenue comes from commercial print. "If we define commercial print to include the print production of direct mail pieces, then this makes up 65 percent of our revenue," he explained. He added that as part of a commercial print job, Communifax "un-bundles" and itemizes its agency fees, which may include concept and ideation, program management and Web development, making up the other 35 percent of the company's commercial print revenues.
What's New
Distributors said that technology has revolutionized the commercial print industry. "Things that were once impossible or very expensive, such as printing on plastic, are now possible and cost-effective," said Ahmad.
"For Communifax, the newest development is the integration of the offline and online worlds," said Zilling. "Using customer touch points to drive consumers to a company's Web site is the way of the future."
Looking ahead, distributors said that commercial printing will remain profitable, but increasingly targeted. "As technology becomes more digitally driven, commercial brochures and direct mail pieces will be uniquely tailored to specific types of consumers," said Battin. "There will be less traditional commercial printing, but rather than spending millions of dollars on advertising in traditional forms of media, companies will invest more in mediums such as direct mail, where they can track the target audience's response."
While Ahmad believes that commercial print sales will remain robust, he said that its livelihood is dependent on the state of the economy. "If the economy is not doing well, commercial print sales will become depressed. But, if the economy is stable, companies will buy a lot of commercial print."
By Cynthia T. Graham