Niche markets have allowed printers to define areas of specialization where they can succeed, even in tough economic conditions. While no one enjoys the challenges of today’s economy, a slow time is the right time to re-evaluate your company’s business strategy. After all, in busy times, when orders are coming through the door fast and furious, and you are working overtime to meet deadlines, who has the luxury of free time to do the planning required to successfully launch into new markets?
The Oxford Dictionary defines a niche as “a specialized but profitable corner of the market.” About.com identifies a niche market as “a focused, targetable portion of a market.” Some niche market companies began by identifying a market niche, then satisfying it. Others carved a niche within the broader market. Who in printing isn’t searching for the niche market which will allow them to grow and succeed?
Finding your niche market can allow you to succeed in a specialized, specific area of the market. The strongest niche markets are those driven by customer demands for innovative products, services or marketing. Many niche markets are characterized by limited competition and above-average profitability.
Printers have many great reasons to explore niche markets. Niches counteract the commoditization of print and limit competition. Successfully marketing your niche will differentiate your company and provide focus and direction to your operations.
To establish themselves as successful niche market printers, companies need to identify and satisfy a need for a product or service which is not well-served by mainstream competitors. Printers, largely being small and medium-sized business organizations, are superbly positioned to benefit from niche markets. Niche markets are often small, but can certainly be big enough to make a major impact on the bottom line of the typical printer, without being so big as to draw much interest or competition from large competitors.
Many companies find their niche market by identifying a customer need which is not well satisfied in the current market. Brainstorm within your company, and speak to existing customers. More importantly, speak to others who are not yet your customers: local businesses, agencies and organizations. Or, look further: poll across the country or internationally using market research tools or low cost Web-based surveys. What needs do customers and potential customers have that are not well served in the present marketplace? Where can you carve your niche?
While identifying a market need is the first step of finding your niche market, enhancing your company’s ability to serve the niche is the second. Successful niche printers continually develop and refine ideas about how to best use their resources. They talk with other printers and get out of their own shop. Industry associations, conferences, trade shows and training courses all provide the opportunity to learn about new technologies, materials and practices. Trade magazines and suppliers help keep printers on the leading edge of new technologies and identify unique ways of using the existing equipment mix and expertise.
Developing a niche market begins with identifying an area of need, but that niche will only help your company if it is one which you are capable of satisfying. In other words, do you have the equipment, expertise and ability to serve that slice of the market? To answer this question, you must next consider technology, materials and the skills of your personnel.
Because niches are often specific to each printer, think about the uniqueness of your company and your community. Are you located in a large population centre which may have untapped needs in the printing marketplace? Or, are you in a smaller centre where lower labour and overhead costs might give you a different type of advantage? Are you close to a transportation hub that provides you with strategic benefits? Perhaps, there are other industries and organizations near your plant with which you can develop a synergistic relationship. Identifying your company’s unique advantages will help you find your niche.
Ideally, your niche will be a growing market, but niche market printers have succeeded in specialized areas which many others had written off long ago. Think of the neighbourhood letterpress shop whose products are now commanding a significant premium among customers seeking uniquely different retro-look wedding invitations or greeting cards. These companies which many would have dismissed some years ago are now differentiating themselves in the market using existing technologies. In seeking your niche, keep an open mind, and don’t throw away any ideas just because they seem pass’.
While you may not have letterpress equipment in your shop, niche markets can be found in all areas of conventional and digital prepress, printing and finishing. In our industry, a niche market can be defined in terms of technology, service or social responsibility, all of which are part of the unique product you deliver to your customers.
There is no question that technology drives printing. It determines the range of products you can produce and the cost of manufacturing. Technology means equipment, software, workflow, materials and methods and the abilities of your employees to use them to their fullest. The unique technologies which exist in your plant determine the unique products you can manufacture.
A cost-effective way of reaching your technological niche is to maximize the unique capabilities of the existing technology in your company. Think outside the box. Find out what interesting and unique applications others have found for your equipment. Scour the trade magazines and attend association meetings, conferences and trade shows. What new or different products can you make using the equipment, software and workflow in your plant? Are there untapped market needs that you can satisfy without a major investment?
Moving into a niche market doesn’t have to mean large expenditures for new equipment. Many existing printers who once earned their bread and butter from corporate annual reports or business forms are now finding success in premium direct mail, labels and other packaging. Other printers have found their niche in combining conventional offset litho or flexo with digital printing or in providing database management services to drive variable data printing.
Advanced new materials help printers satisfy niche markets using existing equipment. Plates, substrates, inks and coatings have come a long way, and suppliers are continually developing unique new materials with specialized applications and unique advantages. Learn about new materials by speaking with suppliers and reading product literature. Visit trade shows and seek out vendor product launches.
New substrates on the market are highly durable, whiter, brighter, more environmentally friendly and offer unique finishes and applications. Inks provide environmental and handling advantages as well as truer, more consistent colour. Extended gamut inks and prepress software allow printers to achieve spectacular process colour results. Coatings dry faster and come in a range of impressive finishes and helpful end-use advantages. Plates allow for quicker, greener processing, easier handling and finer halftone dots. Binding adhesives are more durable and increasingly environmentally friendly. Many of the new developments in consumables will work with existing equipment, helping printers produce new products to satisfy niche markets.
In other cases, a small investment in software or hardware might give you the new capabilities that you need to satisfy untapped niches. Developments in soft proofing allow printers to serve markets over a wider geographic area, without the logistical challenges associated with hard copy proofs. Plug-ins and add-ons to prepress software by original and third-party developers stretch the capabilities of your workflow and allow new applications. Press accessories equip your existing machines to complete common finishing operations: perforating, scoring and die cutting. Specialty finishing equipment for flocking, foil stamping and embossing can position you to deliver unique and impressive products.
Technology is an essential part of defining your niche market. Your company’s equipment, software, skilled employees and the materials you use define the products you can manufacture and the unique solutions you can offer your customers. Work to maximize the use of your existing technology, but be open to the many exciting possibilities offered by new technologies and materials.
While niche markets are often thought of in terms of specific products, printers can also find a niche in the level of service they offer. Much like a bank, real estate agency or restaurant that differentiates itself from the field based on superior, knowledgeable service, printers can carve a niche based on services. After all, printing is not only a product, it is also a service.
Printers have excellent opportunities to differentiate themselves based on service. Many customers are not experts in printing, so knowledgeable advice from printers, combined with superior service can be extremely valuable to them and part of defining your niche market. With the trend toward a service-based economy in Canada and the United States, customers are highly aware of what constitutes good or bad service. Overworked clients increasingly rely on service as part of the package of goods delivered by printers to help them lighten their load.
Service can take many forms. It might mean knowledgeable, helpful and patient sales reps and CSRs partnering with customers to help them succeed in their business through innovative printing solutions. For other customers, service might mean extended hours, faster turnaround or specialized fulfillment services. As with all niche markets, there are opportunities for printers to identify specialized, focused needs for unique customer services.
In order to fulfill a service niche, seek to identify and respond to a unique and untapped customer need. Is there an under-serviced segment of clients you can satisfy who are in particular need of advice or services? Do they need special services in design, prepress, selection of substrates and other materials, processes, finishing or fulfillment? Can you meet and exceed their need for service?
Service niche markets can also be met by anticipating and responding creatively to solve the problems of customers and potential customers, sometimes before they even know they have a problem. Your clients are subject to ever-changing requests from their customers and demands from all levels of government. The challenges faced by your customers present opportunities for your company to offer proactive solutions. Consumer packaging is one example. Legislative bodies in various jurisdictions seek to reduce plastic bags, water bottles, disposable cups and other packaging. Rather than these developments posing a problem for your current or potential customers, is there an opportunity for your company to provide a printed package solution which will meet or exceed new requirements and keep your clients, and their customers, satisfied?
There is an opportunity for printers to be aware of the demands of society and government, and consider not only how changes will affect print, but also how they will affect clients of print, and their clients’ customers. The printer who anticipates new requirements and offers a solution has found an important niche market.
Social Responsibility Niches
Increasingly, all sectors of business and industry are being called upon to be not merely responsible, but outstanding, corporate citizens. In the investment industry, a new niche of “ethical funds,” which invest in socially responsible companies, has drawn much recent attention and now represents a growing segment of the mutual fund market. Fair trade coffee, virtually unknown a few years ago, is today an important and expanding niche in the premium coffee market. Across many sectors of business and industry, the Breast Cancer Pink Campaign helps by raising money using a broad range of products. The Red Campaign involves a variety of companies in the fight against AIDS in Africa. All of these socially responsible vehicles provide opportunities for companies to demonstrate corporate responsibility while serving customers who make buying decisions based on personal values.
The most effective social responsibility niches relate to the company’s core business and values. For printers, this might mean responsibly addressing environmental concerns. In doing so, we printers can take not only what we know is the responsible course of action, but can also satisfy our clients, and our clients’ customers who demand the same. Thankfully, there are many ways to serve this growing niche market.
Environmental responsibility is not new to printers; for years, the printing industry has been a leader in using recycled and recyclable materials, reducing and disposing of waste responsibly, minimizing plant emissions and implementing energy-saving measures.
For printers who embrace environmental responsibility, there are more opportunities than ever to make a difference. Suppliers have excelled in providing new environmentally-friendly materials and energy-saving equipment and processes, and there are many more on the horizon.
However, for clients and end users who make purchasing decisions based on progressive social values, it is important that printers not only do the right thing, but also be seen to be doing the right thing. Printers can augment their efforts in environmental responsibility by supporting and partnering with organizations, such as the Forest Stewardship Council (FSC), Sustainable Green Printing Partnership (SGP) and Sustainable Packaging Coalition. These organizations help printers become excellent environmental citizens and provide tools which help clients and end users identify products that meet their standards.
However, social responsibility goes far beyond the environment. For the many printers who are small, community-based businesses, there are plenty of ways to find a niche in the local community through supporting one or more important and visible charities or community organizations. You will find your efforts especially rewarding if the causes you support are close to the values and business mission of your company. For example, the Tim Hortons Timbits Minor Hockey program and Sleep Country Canada’s Donate a Bed program have supported people in the communities where they do business through activities clearly related to the heritage or mission of these companies. Some printers have established formalized programs of providing important printing services to a small number of non-profit community organizations selected from a list of annual applicants.
Finally, printers can find a niche market in partnering with charities and other organizations by developing products which can aid and support those organizations in their fundraising efforts. Many printed products are especially well-suited to effective fundraising by schools, teams, youth groups and other charities. Can your company develop a fundraising program of unique printed products, such as gift tags and wrap, greeting cards, address labels, or calendars, to help those organizations?
Any discussion about niche markets must include a few words about trends. Be alert to new niches which arise as customer needs change. Look for developments in the market, and pay close attention to any new requests from customers. No one can predict every trend which will affect printing in the future, but successful niche market printers have achieved success with specialized technologies in growing areas, such as security printing, anti-counterfeiting, variable data printing and Web-to-print.
Where to Begin
Finding and embracing niche markets is part of many successful printers’ business strategy, but there are a few warnings that companies should heed before dramatically altering existing equipment, materials, workflow or sales strategies. Niche markets can bring in higher sales, increase profitability, reduce competition, differentiate your company in the marketplace, and provide focus to your company’s operations; however, a niche market is not a substitute for good everyday business practices, such as customer service, quality products, control of waste and minimizing unnecessary costs. More bluntly, niche markets are not a solution for companies whose business practices need significant improvement.
When seeking your niche market, work first to fully use your company’s existing capacity and abilities. Under-used equipment and personnel might be waiting to fill a niche, as soon as you find the right one. On the other hand, after careful thought, you might decide to expand the abilities of your plant through deliberate, carefully-considered purchases of software or equipment. Today’s challenging economic climate offers some significant equipment bargains in both the new and lightly-used markets, and printers today are adding equipment when it makes good business sense to do so. Just remember, making purchases is not a decision to be taken without doing your homework. Know your niche market, consider several competitive options and study return on investment (ROI) and total cost of ownership (TCO) before making any large purchases.
Importantly, don’t forget your employees. Most employees want to be engaged in the company, contribute to decision-making and feel secure in their careers.
Involve employees in brainstorming to seek your niche market. Dispel uncertainty and rumour and obtain buy-in by openly discussing with them any changes in your plant or business strategy. Know the abilities of your employees, and support them through training and involvement in industry events and activities. Help employees develop the knowledge, skills and positive approach that will allow your company to excel in your new niche market.
After you’ve found your niche market, it’s important to market it. Tell customers, and especially potential customers, about what you do and what unique services and products you offer. Speak to clients in person, and show them samples. Offer them unique, forward-thinking solutions which satisfy your niche market. Develop an attention-grabbing, self-promotional piece which commands the attention of your new niche market, and target those who would benefit most from your product.
After all, being able to serve a niche market is a start, but success comes only after clients know what you offer and how you can help them.
Remember that niche markets help printers succeed. Finding that small, but profitable corner of the market will provide your company with focus and direction, differentiate you from the competition and allow you to serve customer needs in a targeted, successful and rewarding way. Examine what makes your company unique, identify unfulfilled needs in the marketplace, and offer creative, focused solutions. In carving out your niche market, consider technology, service and social responsibility as ways of defining how you serve your new corner of the market. And keep an eye on the future because new trends create new niches. Think positively, plan strategically and serve your niche market. These are the steps to an exciting and successful future. Where will you carve your niche market?