Fixing the Local Print Business – The LightsOn Solution – Part One - First Taste.

It is always easy to find critics and be critical, but is by far more difficult to have and execute a solution.  When the critic works for you, you make the critic responsible for fixing the problem; it eliminates those who only criticize.  When an individual is critical of a business situation (an opportunity) and tries to fix it we call them entrepreneurial.

In the local print business, fragmentation has been the norm since before the days of Benjamin Franklin.  The Internet has and is changing that as economies of scale are easily made online.  It has equally changed the trade suppliers business as well who supply many products to the local printer.  So why haven’t some of the local printers embraced the Internet opportunity?  Some actually have, but none to the extent that Vistaprint did which from day one was about economies of scale and collecting and reselling that information they collect and service they provide.  The economies of scale exist with the printed product, but not with the service.  Eliminating the service slowly has and is causing the elimination of the local provider.  The slow loss of revenue is causing for more and more printers to close shop; ultimately what we end up with is a lower quality product – without question – and eventually higher prices and fewer local jobs; both already taking place.  This equates very much to the big box stores and Walmart’s entry to local markets.  Compound this with McPrints and the squeeze on the local printer is almost always insurmountable.

So what does the local printer need to do? We group the local postal services store in here as what they are doing seems to have more impact in fixing the problem than the local printer, in my opinion.

They need to group together in a collaborative and cooperative way in both product and brand.  The problem is that none of the individual franchise companies have the expertise, or primary interest, to work together; not much different than Ace Hardware does in a brick and mortar world – survival of the local hardware store has become as simple as becoming an Ace Hardware providing both collaborative advertising and coop style buying power.  The trade association for quick printers, the NAQP (National Association of Quick Printers), whom merged with the NAPL about 6 years ago, should be pointing out this collaborative need but has the problem of shrinking membership – for obvious reason.

So how does LightsOn solve this problem? In several ways, more than we are going to list here, but the gist will hopefully be understood.

• When the consumer finds LightsOn online, the local printer to that consumer is promoted on the LightsOnGraphics.com pages; this localization can be observed on the right side of every page.  This is accomplished in our own proprietary process by identifying where the consumer connects to the Internet
• The local printer needs to be able to identify and ‘mark’ their current customers.  LightsOn provides, what is commonly called an affiliate code which will make those customers such that, no matter where they are from, the affiliate's information displays on the right (www.LightsOnGraphics.com?loc=HQEBWC)
• Once a prospect becomes a customer, that customer will always see the affiliate's information.
• Local price control by the affiliate.
• The ability for the affiliate to claim the customer, even after they have ordered.
• Pay very high commissions to the local affiliate/partner.

The objective is not to move the local customer online, but to make the local prospect know there are local choices that provide more than the online only suppliers can.  You may ask, why this is better than the local printer’s own website or one of the many branded websites that can be purchased from some of the trade suppliers. And then, so who is LightsOnGraphics.com’s customer and how does that happen?  Too many unanswered questions here.!.!  Remember, I am building the white paper and business plan – If you want to read ahead, read the affiliate brief at LightsOnGraphics.com.

An entry that answers some questions that came after I posted this entry.

More answers in my next piece – Stay Tuned.

Fixing the Local Print Business. Other Companies Solutions (so they think).

Within a Changing Print Market (and the marketplace in general) we inevitably have chaos created by the noise of so many ideas being tested.  This is true in the local print market as companies have the next best idea in fixing the business.  As in any business plan (a white paper in this case), we must have knowledge of what other companies are doing to address the same problem and issues we are trying to solve.  When there is no one else trying to address the same problem and issues, you should question the model itself. First, is there a real need?  In our case, there are plenty of people trying, thus we can more comfortably assume there is a market for what we are trying to do.

LightsOn Graphic’s objective is to provide a tool to acquire locally that share of business being lost to the online exclusive world, ie: Vistaprint as well as the McPrints - We are not just trying to move the same business from one pocket to the other.

What doesn’t work:

                 Any system that provides a web tool for simply communicating to the printer glorified email).  Your customers know you and your number – don’t move them online – printing is still a service business (and they know that).  The companies I am going to appear to pick on today are PostNet and Minuteman Press, both are franchise businesses that are locally owned and operated (the good guys).

Observe where both PostNet’s and MinuteMan Press business card pages go (the resulting URL after you click) (Just a note, we can list many other companies here using this service and ending up at the same URL):

PostNet: http://co105.postnet.com/order/business-cards/

A Minuteman Press in Austin Texas: http://www.austinmmp.com/index.iml?mdl=jobcenter/main.mdl.  This is NOT a Minuteman Press standard.  Most Minuteman Press websites actually have a pretty good online presence and tool in my opinion.

Note the similarity in the URL (resulting forwarded URL after you click); they both use the same service for the online component. The problem is, this online component is nothing more than a glorified email system for the postal store/printer.  What this allows is the PostNet franchisee to say: “Oh yea, we have an online printing component too”, or should I say, what the franchisor says to the prospective franchisee.  Try to order something (there is no way); in my very humble opinion, it has no value.  I question whether it ever generates orders. Compare that to Vistaprint, which is mult-multi click, but at least you can complete an order there.  Finally compare that to LightsOnGraphics.com where entry is real quick (few clicks), especially if you are a repeat customer.  There are no Vista distractions on LightsOnGraphics.com.

Adding one other note to this - their Alexa ranking (the print redirect page) is 239,302; considering there are about 300 PostNet’s using this (as well as a multitude of other printers, etc.) that is a pretty bad number.  That compares to LightsOn Graphic’s Alexa rating which is 317,360 which we have not rolled out yet.  Alexa is a website ranking company owned by Amazon; download their tool bar; I find it fun to see who is real and who is not.  Note the PostNet and the MinuteMan Press pages have the exact same Alexa number.

Finally, we have to also consider the McPrints in this comparison as they are local and do have very good online presence and websites.  The problem comes from expertise, knowledge and customer service that the real local printer provides; the McPrints don’t compare in my opinion (including in price).  This makes them one of the bad guys in my opinion.  As an analogy, compare ACE Hardware (a Good Guy) to the Big Box Stores (Bad Guys) – I am sure I don’t need to say any more.

So what will make LightsOnGraphics.com different?  Stay tuned..!!

Understanding the Changing Print Market

As in each of the blog entries I have done over the last few weeks, I need to qualify my work by pointing out the complexity of the print market and that I am defining and describing the market with generalizations that could easily be argued.  I am also doing this for the first time with relevant diagrams that are not meant to accurately reflect market sizes but instead meant much more as a tool of general perspective.

The first diagram represents the Vistaprint share of the market.  I would argue that Vistaprint created the "Consumer, Super Small, MLM Business" print market.  There were products being sold to this market prior to the 'Vista era', but those products are specialized and are still being handled by specialized 'high-service' companies and the trade suppliers that supply those local 'high-service' companies (ie: wedding invitations).  Vistaprint, I would argue is not in the printing business, but in the data collection and marketing business.  The real issue with Vistaprint is their presence and the perception they have created in the marketplace.  It is also without argument that their market share continues to grow faster than the market.  I would go as far as saying, they have played the Internet game as well as anyone.

The second diagram represents the local 'high-service' market.  Suppliers in this market include the traditional local independent printer/quick printer, the franchise quick printer and entering this market recently (last 15 years) are the office products super stores (Staples, Office Max, Office Depot) whom I will generically refer to them as McPrint.  I group these all together as they satisfy the exact same markets and their trade print suppliers are the same as well.  The local independent printer and franchise printer, whom I consider the 'high-end' of this market are obviously squeezed in the market by the "online mega-print website"(Vistaprint), the McPrints and now, add to that, the postal service stores most recently.

Finally, the last supplier of print, as depicted in this diagram, is that to Big Business and that Large Commercial Printer and Agency Supplier.  These are the least threatened by the Internet supplier, but are much more threatened by the Internet itself (ie: Britannica ending print versions this year, thinner magazines, etc.).  Where this does come into play in the local market is that many of these printers are the trade printers that supply products and services to the local printer.  Obviously a complex, complicated and convoluted business market - and I am only scratching the surface.  Add technological improvements, economies of scale and an abundance of used 'old-technology' equipment on the market and the business is beyond understanding and really 100s if not 1000s of different businesses.

So what will LightsOn Graphics business game be?  Making the 'local', whomever that may be, much more efficient and creating an advantage over the threat from Vistaprint.  Several big companies have Vista kill projects - We have the answer that makes this possible - which will save this local service market and ultimately keep quality up and prices in check for the consumer - stay tuned.

Identifying the Opportunity - Having a Vision - More Cause (not the effect- yet).

As I have said before, even though my focus is local printers and saving the local printer, what I am saying can be applied to so many different businesses today.

Local printers are having a great deal of difficulty competing with the 'online mega-print website'; why?

1) Perceived price - the 'online mega-print website' advertises low prices that are not real, especially if you, the buyer, are really in business.  You don't want the printers information on the back of the card, you want it faster than 3 1/2 weeks, you want it to represent you and not some generic template and you want it on a card stock, not a heavy paper.  Of course you can pay for the "upgrades" that make it a normal business card, but then you would pay about the same, and sometimes more, than you would if you had bought it from the local printer (without the local printer guidance for you).

2) Advertising - the 'online mega-print website' can advertise in big ways, painting a picture that they are the norm.  They are not, but consumers don't interact enough with printers thus they have no knowledge of any other place to go.  This is why the online mega-print websites have won the B2C business, but have not been able to pierce the B2B opportunity.  Once your business becomes real, you no longer have the time to waste 45 minutes placing an order, wait 3-4 weeks (std delivery) for the order and then finally receive the inferior-undersized product.

In reality (in my head), the local printer needs to NOT try to fight this battle with the online mega-print websites; it is a waste of their resources and they can not convince the consumer until they experience both the product and process first hand.  The local printer must focus on real businesses.

A funny footnote... I was talking to someone last weekend about this and they said they liked the 'online mega-print websites' as they saved money, did not mind the 'online mega-print website' ad on the back, did not need it fast and the quality was not important.  I said, "your law firm orders from 'online mega-print website'"?  Her response was "Oh no. for my side business, they (the law firm) would never order 'online mega-print website' cards".

Finally, if the printer focuses on competing with 'online mega-print website' we will see the end to this local business and service and the cost of this product will only increase in the long run.

Yes, I think I have the solution and am getting around to telling you about it.  Visit www.LightsOnGraphics.com - figure out what we are doing.  Rolling this out on a broader basis shortly.

Identifying the Opportunity - Having a Vision - The Cause (not the effect)

I am writing this specific to the local printing market, but the concepts and the decisions apply to business in general as this blog entry demonstrates.

Prior to the 1960s, most home town business was locally owned and managed  - a time long gone.  We remember (some of us) the local pharmacist, the diner, the tailor, the cleaners, the corner store, the local printer, etc...  We then experienced a transformation where enterprising individuals (opportunists) expanded their businesses by packaging their business such that it could be sold to individuals looking for opportunities in distant locations. The 1950s and 1960s were the "Wild-Wild-West" era of franchising - minimal regulation and scams in a "buyer-beware" world.  The boom in franchising began.  Franchising brought us (arguably) consistent quality, business buying power and trusted/recognized brands.  With time, regulations from the FTC and its state equivalents made the purchase of a franchise much more transparent if only by making cost-of-entry so much higher.

The Internet era brought new competition; "local" was redefined as being as close as your computer.  Regulations ended up not being needed, even though they were frequently brought up and discussed.  The Internet (as a market) has evolved into a self-regulated market with minimal government regulation (not making a political argument here).  The 1990s and early 2000s were the Internets "Wild-Wild-West" era; today, we have evolved, like franchising evolved, into a market where we have trusted shopping locations, consistent quality and trusted brands.

The bad side of the Internet, IMHO, is the elimination of local service in business transactions that require service (again IMHO).  I have a story that should hit home pretty hard.  Remember the Hobby Shop?  I was in one in South Florida in, I think around 2002,  I witnessed the owner becoming very upset with a consumer who was a slot car enthusiast.  The consumer, I guess, would frequently come in, evaluate a products quality and suck knowledge and demonstration from the store owner and then buy the product online for the purpose of saving $3 on a $30 item.  What I witnessed was the store owner losing-it and kicking the consumer out of the store.  Who won here?  The store eventually went out of business and the consumer lost their ability to touch and evaluate the product before buying it.  Bought one of those radio-controlled helicopters lately? - Junk.!.!  Even worse, they cost more for the return shipping than original cost of the product... ugh..!!

How is the local printing market similar to this?  Next entry...

The One Thing We Can Count On – Change – A Changing Market – Case Study Chapter One

The Internet has changed so much about our businesses and the market(s) we sell to, no matter which one(s) we are in.  Adapting to the changes is the key to being able to survive in the future.  I have seen four business environment changes (ice age type changes) in my adult life (the 4^th being the current one).  Some companies survived because they were adaptive through entrepreneurship (dictatorship) control; some companies survived by refining their business model, sometimes through brute force and several mistakes until they get it right and then sometimes the survivor is just new entrepreneurial opportunists.

The natural tendency of change is towards chaos. It is imperative to focus efforts towards the vision. It is almost impossible that any complex change can be managed with any rigid structure and then deliver successful results - for change to succeed, frequent adjustments must be made – a fluid plan (of course, there are several MBAs and consultants, who have never done, who will tell me differently). The art of success and management is to create harmony, order and direction from chaos.

I (the opportunist) am going to create a series of blog entries (my business plan) defining an opportunity (the changed market) in the local printing business.  I expect this to be both fun and rewarding to all the Time4 and LightsOn offices.  It’s somewhat complex (the opportunity) so I’ll be documenting my hypothesis and tests in small chunks.

I have been nurturing these ideas with the Time4 offices for the last six months and have started rolling out different segments.  The first was (and continues to be) establishing an SEO presence in the markets being targeted – success – we have 1^st page Google presence nationally in several specific product searches – sometimes two, sometimes three, and a few times four different positions in the Top 10.  Maybe we should have been in the SEO business – NOT – way too much incompetent noise.

Similarities between Mother Nature and Our Economy

Within nature there is the unwritten rule of “Survival of the Fittest”.  During fat times species flourish, populations grow and animals get fat.  Then Mother Nature unleashes her fury; there are Droughts, Hurricanes, Volcanoes, Tornadoes, Earth Quakes and Asteroids (Duck) creating despair and a  shortage of food and shelter.  After the fury the strongest, most innovative, most persistent and most prepared survive weeding out the weak and making for a better, stronger balance in nature for the times ahead.  Mother Nature’s Fury repeats itself.  We recognize it as a thinning process and as terrible and cruel as it is, we accept it.

Between 3 and 4 years ago, I was doing volunteer work for SCORE and frequently spoke to small businesses about the difficulty of a recession (Mother Nature’s Fury).  Recessions are about survival for many businesses and those that do survive because they were strong, innovative, persisted and prepared will find there is less competition and more opportunity as the sun begins to shine again.

The sun is shining.