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Cathedral Corp. : Leading by Good Example

March 2012 By Erik Cagle, Senior Editor
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Marianne Gaige may have played follow the leader when she was a little girl, but the president and CEO of Rome, NY-based Cathedral Corp. is more concerned about being at the head of the line and guiding her customers as they navigate the ever-changing world of print-based tools that can deliver personalized messages quickly, economically and impressively.

The secret to her success? No fear. Apprehension certainly crosses the minds of all printing executives at some point as they're constantly bombarded with news about the thinning of their industry's herd. But worrying isn't going to do Gaige, or Cathedral, any good. "We have to keep moving with technology without creating too much risk," Gaige notes. "We do think about the economy and the future of printing, but we can't be afraid of where print is going. Instead, we need to anticipate customer needs and lead with innovation."

Cathedral is demonstrating the ability to lead by example. This $25 million provider of direct mail and transactional/promotional (transpromo) printing is looking to grow through acquisition. It has engaged an M&A firm to find a perfect match or two, targeting firms that can build upon Cathedral's offerings or complement them.

Gaige has ample female representation in the executive offices—Mary Keating, Donna Eychner and Kimberley Waltz are all vice presidents—and more than 60 percent of the firm's stock is held by women.

Gaige is also clearing off a spot on the manufacturing floor (the firm has a sister plant with redundancies in Lincoln, RI) for a new Xerox CiPress 500 waterless inkjet production press. The longtime Xerox customer is excited for the opportunities the continuous-feed, full-color printer will afford, especially as its transpromo business continues to blossom. And, the ability to go waterless and open up more possibilities for coated and uncoated substrates made it an easy call for Gaige & Co.

Speaking of the chief exec, Gaige has presided over considerable growth since taking the reins in 1993, when the firm was almost exclusively a $3 million per year envelope printer for the Catholic church. Now, Cathedral stretches a bit higher in the sky with roughly 5,000 clients within a diverse mix of client verticals. In addition to the religious set, Cathedral serves industries ranging from financial services to health care, higher education, utilities, nonprofits and government entities.

Highly Targeted Pieces

"We don't produce the million-piece campaigns. Segmentation is really our specialty," she says. "We analyze the data, segment it and then create targeted pieces that address each of those segments. Multiple match is another area where we excel, bringing in pieces of information unique to that recipient. Lots and lots of database work...that's our specialty."

Transpromo has been a work in progress that, in recent years, has paid off handsomely for Cathedral and its clients. The evolution to full color juiced an area that had resigned itself to black-and-white transactional statements and documents out of cost considerations.

"Transpromo has been a buzz word forever, but getting there is really harder than it looks," Gaige notes. "It really requires a lot of work for our customers to create targeted offers based on analysis of what their clients are currently buying.

"During this recession, our customers who incorporated transpromotional, truly personalized and targeted offers in their statements grew and didn't cut back pages. They don't look at these statements as just a cost center, because they realize that, in essence, transpromo documents provide a free ride for marketing to sell more to that customer. It's a lot less expensive than putting an ad in a newspaper."

One of the tools in Cathedral's belt is its Essentials line of printed and electronic communications programs—documents, statements, direct mail—adaptable to the vertical markets that the printer serves. Its tag line (developed with the help of strategic marketing consultant Marion Mathison) is "transforming data into essential communication."

What helps make this program effective, notes Tom Wetjen, senior vice president of sales, is that Cathedral's sales force is comprised of many individuals who hail from that given industry. For example, when they call on a diocesan client, Wetjen's crew consists of a pair of former development directors for bishops. On the higher education side, Cathedral uses a former admissions director. A certified fund-raising executive is also on the sales team.

"Our salespeople come in with a high level of expertise about what's going on within their specific industry; they know how to speak the language," Wetjen says.

"We also spend a lot of time focusing on specific applications. When we go into the credit union/community bank space, we sell statements—both printed and e-statements—we sell direct mail and direct marketing, we sell bills and electronic notices. We have a very deep level of expertise in truly understanding the data and being able to use data to target these various communications."

On the Acquisition Trail

After years of organic growth—Cathedral averaged between 6 and 10 percent annual growth prior to 2011—the printer has engaged M&A specialist New Direction Partners to help identify possible acquisitions. Since the company competes on quality and customer service, Gaige feels it's only appropriate to target another concern with that same corporate culture. Customer retention is also important; Cathedral's top clients have been on board for 15-plus years. Geographically, the southeastern or southwestern part of the United States is a strong bet, but not a given.

"Our goal is to acquire a company that's not in trouble," she says. "The companies that survived the recession and prospered did so through great relationships with their customers. That's our core strength, and it would make a similar company a great fit with ours."

In March, Cathedral will take delivery of the CiPress 500 in its all-digital shop (which includes Xerox iGen3 and iGen4 presses and a 980 continuous-feed color printer). Given its success with moving statement-size jobs to the 980, and noting that customers are using full-color and the marketing ability of the full-color statements (complete with QR codes and PURLs) to grow relationships with their own clients, Cathedral seemed destined to add the CiPress.

"What's really impressed me about the CiPress is not only the big advantages we see in running costs, but the work that Xerox has done on image quality is really quite spectacular," adds Wetjen, who spent more than 30 years at Xerox prior to joining Cathedral. "This waterless inkjet device will be used for all sorts of color applications that, in the beginning, people did not feel it would be capable of doing. It provides flexibility on various substrates that simply wouldn't work in the aqueous inkjet world. We believe it will open up all sorts of applications."

The firm is also sinking several million dollars into intelligent inserting equipment, with investments in both Bell + Howell and Pitney Bowes technology, according to Gaige. An online ordering system is also on tap.

Perhaps one of Cathedral's most endearing qualities is its ability to deliver products and customer service to the small- and medium-business space at a quality level on par with major corporations. The longevity of the printer's client base is proof positive; the average customer has been calling on Cathedral for 18 years which, incidentally, falls just short of the average employee tenure there.

Speaking of employees, Cathedral does not employ part-time workers. "It's difficult to foster an environment of 100 percent quality when you don't make a commitment to your employees," Gaige notes. "We hire people and take care of them, like our customers would."

With 2012 growth projected between 3 and 4 percent, Gaige's prime focus is to stay attuned to the needs of her clients. "We need to listen to them and make whatever changes are necessary," she concludes. "The most important thing is to keep moving, to think in two- to three-year time frames, and to make sure we're investing enough in future technologies, without taking on too much risk."for bonus coverage on how Cathedral's data management skills helped it to enter new markets. PI


 

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