“Variable Data Printing is like high school sex. Everyone thinks everyone else is doing it. In fact, not that many people are doing it. And those who are, aren’t doing it very well.”
Bill Farquharson, Print Tec Network
Print service providers have been squeezed and commoditized to the point that they are frantic in their search for services that will add value and be profitable, and variable data printing is one of the top solutions printers consider as a value-added service. Equipment and software vendors are more than happy to help size the market, justify the purchase of their equipment/software, and build the supporting workflow and processes.
It may be, however, that Bill Farquharson was right in his contention that the perception and reality of variable are quite different. A Q3 2007 PIA/GATF survey indicated while 81% of the 252 respondents reported that they offer variable data printing1, there are few “customized customer communications” produced. Only 15% vary text and images, 4% produce transactional projects, and 2% implement digital images (like Direct Smile). The majority vary text only (55%) or overprint “shells” (22%).
This month we spoke to Julie Northrup, Director of Sales at Terminal Van Gogh in Toronto, about the planning process that should go on when preparing to launch new VDP products and services.
GAM: You’ve been in this business for a while and it’s pretty clear that buying the equipment, setting a sales target, and opening the door is not a business plan. Hoping for something to succeed is not a business plan! Where does one start?
Julie: You can’t go into this business without a plan. You must be proactive and thoughtful. Why do you want to add variable data printing? Have you identified areas where digital one-to-one will add value to what you offer your customer? Assess what your customers might buy in the future, but don’t expect them to be able to tell you.
There are no figures to estimate actual demand for your services. This is an entirely new space and you need to be prepared to put time and energy into it to be successful. Learn about the capabilities of the process so you can recognize an opportunity when it presents itself.
Get back to basics; carefully examine your strengths and weaknesses, look at opportunities and threats—will moving into variable data printing improve those weaknesses or simply make them worse? Do you clearly understand your customers and their needs? Are the opportunities real or seen through rose-colored glasses?
While every vendor out there will help with analysis, keep in mind their final goal is to sell you equipment and/or software; your goal is to make a profit from it.
GAM: Let’s talk about going to market and market development. How do you succeed when you’ve got something to sell that is difficult to describe and your customers don’t know what it is or if they even need it?
Julie: That is the million-dollar question; and I think that’s where people are floundering. I start by finding out what the prospect’s business issues are. I do a lot of market research upfront— thank goodness for the internet!
Look at your prospect’s website, see what they are doing. Read their annual reports; look at their press releases and their sales materials. Are they looking to increase sales? Do they want to improve efficiency? Are they hiring IT people? What about customer relationship management staff?
You can’t go in the door with a solution without working with your customer to define the problem. In the end the solution actually comes from them. I have to identify the business issues they are grappling with and then show how TVG’s data-driven solutions will solve their problems.
GAM: What about executing on the new business initiative; what processes need to be in place?
Julie: I believe the first thing you need to do is to build a cross-functional team to address issues and solve problems going forward; that means bringing together sales and marketing, prepress, database managers, production people, and the executive team.
This team needs to have the authority to look at existing processes and to adjust or maintain them as needed. They need to have the courage to challenge the status quo in their own organization and even in the customer’s.
Most importantly the team needs to have determination and commitment, and understand that it’s going to take longer than anyone anticipated to be successful. Ben Passmore, co-founder and President of TVG, uses the two and a half rule—it will take twice as long [as you think], cost [twice as much], [and bring in] half the return.
Next Month: The Business Of Variable Data Printing – Part Two
Next month we will talk to Kevin Lanuke, President & CEO of Blitzprint in Calgary. Kevin has offered variable data printing for nearly six years; we’ll find out why he’s shifting from relevance marketing to value-added publishing services that dovetail with his current short run digital book production offerings.