4over Inc. : Gambling with SuccessOctober 2011 By Erik Cagle
“It’s all about pushing my limits, seeing how far I can go,” he says, quite simply. It’s a philosophy that has certainly dictated his business career and, at times, the CMYK pattern in the company’s logo takes on the appearance of a target. Yet it doesn’t stop Megerdichian from putting more chips in the pot.
It’s not an exaggeration to call 4over the most well-known trade printer in the industry. The $78 million firm, which provides products such as business cards, post cards, greeting cards, plastic cards, envelopes, booklets, brochures, sell sheets and table tents to more than 59,000 trade customers, is certainly the most visible to-the-trade performer, with its bold advertising agenda and high-visibility booths at Graph Expo in Chicago (remember the Chicago Bulls cheerleaders’ appearance?) each year.
By the same token, it is certainly no exaggeration to say that 4over has one of the most prolific expansion platforms in the industry today, and that’s without the “trade printer” qualifier. 4over has facilities in seven states and Canada, having added new plants in Miami, Dallas, Phoenix, Chicago, Dayton, OH, Newark, NJ, and, most recently, Toronto, to its original California production base—all since 2007. A Seattle facility will be the next to come online.
Either no one bothered to tell Megerdichian that the industry is in the throes of a prolonged dry spell coming out of the recession, or the maverick executive views the current climate more winnable than an inside straight in poker.
“Our company took advantage of the economic downturn. We did the opposite of what everyone else was doing—stopping and waiting,” he says. “We expanded in order to capture more market share and to get closer to our customers. It’s been working well for us.
A Calculated Risk
“With the type of business we’re in, clients tend to want things really fast,” adds Megerdichian, who relies on his ‘giants,’ a five-man team that specializes in getting new facilities up and running. “Large retails like Vistaprint can serve all from one location. Our customers respond to their own customers, so as soon as they receive an order, they need to get it to their own customers. It was a risk, though a more calculated risk, because we have a large network of customers all over the nation. It’s helped us to complete orders faster and to create new opportunities.”
There’s method to 4over’s expansion madness: the ability to provide two days ground shipping to any customer in the U.S. mainland. The addition of Seattle will realize that goal, according to Megerdichian.
However, being such a large and growing company has provided for more than a little jealousy and a bit of animosity within the industry, particularly in light of the new ”Red Tag Project“ launched in 2010. Located at www.redtagprintsale.com, Megerdichian had devised the Website for a single purpose—so many of his customers were losing business to the Vistaprints of the world. Doing nothing, says Tina Hartounian, 4over president, was tantamount to raising a white flag.
“We had a few options,” she remarks. “One, do nothing. Two, join the bandwagon and do what everyone else does, which is to sell online direct. And three, the hardest one, stay with our core customers and don’t abandon them. We picked option number three.”
The Red Tag Project is designed to recapture print consumers who have gone over to the larger direct-to-consumer online printers for their needs, completely bypassing the traditional print seller—4over’s core customer—in the process. Redtagprintsale.com advertises the products, sets the pricing and captures the orders. 4over does the printing, and its participating customers are assigned to provide customer service to the consumers placing orders in their local area (and any consumer the 4over customer refers to the Website). The participating customer is given the consumer’s full contact and order information, and 4over encourages them to market their own product offerings to the consumer. Because they are permanently assigned to a consumer, they also receive a share of the revenue on all orders placed by that consumer.
For example, if a client in Cleveland needs 5,000 sell sheets, 4over prints the order, and if there is a problem the consumer contacts the local print provider—the 4over customer—for help. That means for every order captured by Redtagprintsale.com, a 4over customer is getting a lead to a consumer who it knows is buying print, plus a share of the revenue Redtagprintsale.com gets from that consumer. How 4over’s customers use these leads is up to them. They do not have to share their accounts (whether obtained through Redtagprintsale.com or not) with anyone. Redtagprintsale.com collects a monthly membership fee from participating 4over customers, which is used toward the marketing and constant development of the Redtagprintsale.com Website and product offerings.
Megerdichian is a strong believer in loyalty, which he shows to his customers and vendors. He sees Redtagprintsale.com as a natural extension of that loyalty, but some 4over customers, including two print franchisors (who Megerdichian greatly respects), did not see it that way. They reacted by telling their fellow printers and franchisee members that Megerdichian was selling against their businesses. The trade printer that famously touted ”we will not go behind your back“ in a print campaign was now doing just that, one anonymous person proclaimed.
While Megerdichian acknowledges that “you can’t please everybody,” he is winning over many converts. During the Phoenix opening, a visitor approached Megerdichian and expressed his misgivings regarding the Red Tag program.
“He said, ’I’m selling it for $80 and you’re selling it for $20,’ ” Megerdichian recalls. “I said, ’Do you know that Vistaprint is selling it for $15? Do you know that if a customer goes over there, you’ve lost that customer?’ Right after I made that comment, he was asking me questions about how he could join Red Tag.
“Printers are smart people. We can’t pull a fast one without them knowing. They understand what we can do for them and, because of that, we’ve experienced the growth we have all of these years.”
The lead generation has been substantial. The site offers all of the items associated with commercial work, along with a litany of large-format items (including banners, posters, car magnets, rigid signs and window clings). Personalized calendars and puzzles, as well as photo books, are among the other offerings, and Megerdichian plans to expand into other areas, including t-shirts.
For those printers that simply don’t wish to participate in Red Tag, 4over was (at press time) in the process of rolling out branded Websites that have all the capabilities of Red Tag. This white label offering will allow users to implement their own logos and pricing structure.
Wide-format digital printing capabilities made its debut with 4over in 2008, after much research and customer feedback showed a strong demand for it. After testing it in California, 4over began rolling it out in other facilities, and Megerdichian says wide-format equipment will be in all of the trade printer’s plants by the end of 2011.
If this all sounds like a flurry of activity, well, that was by design. Megerdichian refers to his organization as a “fast-moving train. We cannot slow down and we can’t stop.” This forward-thinking mantra, along with the 4over slogan, “Nothing is impossible. The impossible only takes a few days longer to achieve,” helps 4over maintain a fresh, inventive firm.
“We have internal loyalty, teamwork, and quality of products and services,” he adds. “I believe we have a strong company culture and a very good team. We’re trying to push the limit on reaching 100 percent quality every day. We’re not perfect, but we’re getting better and better for our customers.” PI