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Carl Gerhardt

Business Sense & Sensibility

By Carl Gerhardt

About Carl

Carl Gerhardt is the chairman of Allegra Network, one of the world’s largest print, marketing and graphic communications franchisors, linking more than 500 locations in North America under the brands Allegra, Signs Now, Insty-Prints, and American Speedy Printing.

Carl and his wife, Judy, owned and operated their own successful Allegra Network franchise for nearly 20 years before selling the $2.3 million operation in 2003. He is a PrintImage International/NAQP Honorary Lifetime Member and was inducted into NAPL’s prestigious Soderstrom Society in 2010 in recognition of his contribution to the industry.
 

Marketing Services - the Myth, the Reality and the Truth

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With all of the hype and talk in the industry, you would think that becoming a marketing communications or marketing services provider is akin to the Second Coming.

The Myth

If I become a marketing services provider and start acting like an ad agency, it will turn my business around overnight, and customers will flock to my doorstep and/or Website and flood me with business.

So, I guess I should change my name to something fancy, give new titles to my sales and customer service staff, revamp my signage and lobby, launch a new Website and start marketing to an entirely new prospect list. Cross-media campaigns, variable content,  personalized URLs, QR codes, social media and almost anything that does not touch a sheet of paper with ink or toner on it will bring salvation to my business.

If I don’t do this, my business is destined for the scrap yard or will soon become “consolidated” with one of my competitors. I’ll join one of those 1,000 or so printers that the industry pundits like Dr. Joe Webb, Frank Romano and Andy Paparozzi predict will exit the market each year for the next few years.

The Reality

This industry has always gone through dramatic changes ever since the days of Gutenberg. The changes we are going through now and how they impact the marketplace are not all that different from the changes of the past.

One could say that the main difference today is that everything just moves faster, and the time to react is shortened. Many printers will successfully make the transition to marketing services providers.

• Some (probably fewer than most realize) have already made that transition. Call them the innovators.

• Others will make the transition quickly, if they have or can access the required resources. Call them the early adopters.

• Still others will make the change gradually, as it suits their timetable and as they learn from the early adopters and innovators (those with arrows in their back). Call these the “hump in the bell curve.”

So what about the rest? We’ll call them the late adopters or laggards, and that may be correct in many cases. Some of them may get a bigger piece of a smaller pie by acquiring other printers or simply selling and marketing more effectively. Others may just settle for a smaller slice of a smaller pie and not really change at all. There are still a few “craftsmen” making a living running letterpresses for the trade.

The Truth

The truth is, while making the transition to becoming a marketing service provider (and doing it quickly) may be the best way for many—even most—it is not true for all.

Some simply don’t have the desire or aren’t ready to play in this sandbox. Industry pundits and, yes, franchises like the one I am a part of, can be guilty of holding out what we assess to be the most ideal approach as an imperative or the only path forward. This can be for a good purpose. Often to sell an idea, you have to oversell it.

But in the process, a lot of inaccurate impressions can be formed; the biggest one being that if you don’t do this right away, you will face a quick and certain death. A good metaphor here is that as an industry, we don’t have a blockage in our arteries requiring emergency open-heart surgery. Rather, we all have high cholesterol and high blood pressure, and if we don’t start eating right and exercising, we may not live the long healthy life that we could otherwise.

There are many well-run, well-positioned, profitable printing companies that will be successful for a long time without jumping on the marketing services bandwagon. How long can they do this successfully? There is no one answer to this without understanding the particular company and the markets they serve.

Some will specialize. Some will get a bigger piece of the smaller pie by acquiring their competitors or by being the last man standing as others decide to fold tents. Some are close enough to retirement to simply ride it out and eventually sell the remaining assets.

Could some or even all of these companies be even more successful if they at least partially adopted the marketing services concepts? I think the answer is clearly, Yes!

Why Should We Care?

What gave me the most trouble writing this piece (notice I did not say keyboarding, texting or tweeting) was deciding what title to give each scenario. Which is myth, which is reality and which is truth? We all must decide this for our own companies irrespective of what we see happening in the industry.

So, change the headings to suit your own view of where you are in the adoption cycle. Remember, the laggard often gets eaten by the lion, the one in the middle of the road can get run over, and the innovator can get so many arrows in the back that he never gets to the finish line alive. You can succeed or fail in any of those positions.

At Allegra Network, we are continuing to encourage our members to move, and move quickly, in this direction because we think the opportunities are great. We have recruited high-level agency personnel with a cadre of designers, copywriters and marketing planners to staff our Marketing Resource Center. We have established a Marketing Central certification program for our franchise members. And, we are running as fast as we can to help members dodge the arrows, stand in the safe zone of the road and run faster than their competition.

At the same time, we do recognize that for a host of reasons, some of our members may not move quickly in this direction—or not move at all—and that is OK, too.  We will continue to support them with their chosen strategy. Whether our members move quickly, slowly or not at all in this direction, we have checks and balances in place to remind ourselves that we must “stick to the core” while we “go for more.”

Thanks, Andy Paparozzi, chief economist at the National Association for Printing Leadership (NAPL), for giving us this valuable mantra. Our success in the long term will be directly tied to our ability to maintain—and even grow—our base core business as we develop our ability to enter new markets.

And that’s the truth!
 

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COMMENTS

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Most Recent Comments:
Craig Kevghas - Posted on March 03, 2011
You wrote, "Could some or even all of these companies be even more successful if they at least partially adopted the marketing services concepts? I think the answer is clearly, Yes!" Last October, the people who conduct the On Demand show gathered some of the best minds in the industry and discussed this same issue. They agreed with your assessment. So how do companies learn how to become a marketing services company, and do it without making all the same mistakes others have? It may sound like a shameless plug, but the Publishing Xchange Conference (at On Demand 2011 beginning March 23rd) does just that. It's the next step that every service provider should be considering. This conference brings the best together to explain the how's and why's, as well discusses the potholes to avoid. Check it out... the revenue streams are there for the prepared and informed.
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Archived Comments:
Craig Kevghas - Posted on March 03, 2011
You wrote, "Could some or even all of these companies be even more successful if they at least partially adopted the marketing services concepts? I think the answer is clearly, Yes!" Last October, the people who conduct the On Demand show gathered some of the best minds in the industry and discussed this same issue. They agreed with your assessment. So how do companies learn how to become a marketing services company, and do it without making all the same mistakes others have? It may sound like a shameless plug, but the Publishing Xchange Conference (at On Demand 2011 beginning March 23rd) does just that. It's the next step that every service provider should be considering. This conference brings the best together to explain the how's and why's, as well discusses the potholes to avoid. Check it out... the revenue streams are there for the prepared and informed.