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The Printing Industries of America just released another economic and financial report this week on the future of the printing industry (free to members, another benefit of membership!).  A Planning Guide for 2012-2013, outlines industry trends and impacts on printing markets, and provides strategies and tactics on how to handle possible difficulties and how to take advantage of opportunities in the year to come.  The full report can be found on PIA’s website, while we have provided you with five tactics and strategies for doing business in this year’s printing industry.

 Evaluate Print and the Economic Cycle

Every industry trends differently with the economic cycle.  The printing industry closely follows the economic cycle, meaning that when the economy improves or declines the printing industry does comparatively the same. Knowing and understanding what position the printing industry is in the economic cycle is important and operational decisions, such as investment, should be adjusted accordingly.   It is important to note that the printing industry generally leads recessions and lags recovery and does best in the (economic) mature recovery stage. 

Know Your Position in Competition and in Life Cycle

Although the printing industry has moved from a mature to a declining stage in the industry life cycle, this may not be true for every segment of the print market.  Every product and process differs in life stage, meaning while some may be maturing or declining, other functions in print may be in the growth stage.  This can be found by examining the relative sales change by sector compared to the total printing shipments.  An example is digital toner and inkjet processes are still in the growth stage where as ancillary services are in the mature stage.  The stage in the life cycle impacts strategic decisions and thus why understanding the life cycle your company is in is important. 

In regards to understanding competitive position, companies can look at the total sales in a print sector compared to the number of firms.  This is how opportunities can be discovered.

Prices, Sales, and Costs

It is general business knowledge that to increase profit is to decrease costs, increase sales, or increase prices.  What we tend to ignore is the importance of pricing power.  Pricing Power is when there is strong demand for a product due to at least one of the following factors: specialization, deep knowledge and understanding of customer needs, diversification, strong branding, well encouraged and rewarded sales team, and demand driven versus cost driven pricing. Pricing Power, although not typical for all firms to have, generally is the leader in cause of profit leadership, (compared to cutting costs and increasing sales). 

Strategy Check and Planning

It is very important to have a strategy for the year and to plan properly.  As we just mentioned, specialization and diversification are two big factors in a companies’ profitability.  Because specialization decreases costs and diversification increases price, it is best to have a plan for achieving both.  It is essential to note that wherever your firm is in the printing spectrum it is important to think about the future.  You may be facing a state of maturation in the printing life cycle and it would benefit to think ahead to the next step: (ie: possible opportunities?)

People and Attitude

While we expect the labor market to be on the rise it is going to be a slow process.  It is a rule of thumb that the economy has to grow at about 5% for a full year for the unemployment rate to drop 1%.  This results in opportunity for employers to hire skilled and qualified workers at a lower wage.  However, don’t let this affect the need to spend time and money on employee education and training.  One last thing: have a positive attitude.  Having a positive can-do outlook and demonstrating this to your management and employees can go a long way during this time of economic difficulty. 

Do you have any advice for approaching 2012 and what’s to come?  Tell us your thoughts!

 Social Media is an incredible and very important medium for businesses to utilize as part of their marketing efforts.  It can be very effective if used correctly, however; there is potential for it to be damaging if used incorrectly.  A recent article entitled, “6 Social Media Threats” written by Visible Technologies shared the biggest threats Facebook, Twitter, YouTube, LinkedIn and other social medias can bring to a business.  We’ve highlighted these threats below: 

 Lack of Social Media Policy 

Not only may your company be using social media for marketing efforts but your employees are most likely using the same sights for personal use.  People tend to put anything and everything online and this can be damaging to your company in many ways, such as image or reputation. Having a social media policy can set the rules and limitations for employees on what is acceptable for social media usage.  This policy can save your company from legal and financial problems by providing guidelines for communicating in the online world. 

 Social Networking Security

It seems that hackers and spammers have discovered everyway possible to gain access to computer systems; social media sites being a very commonly used source.  Irresponsible downloading can lead to very damaging viruses or leaking of valuable company information.  Providing a proper education on the do’s and don’ts of social media sites can lead to a virus/hack free workplace.

 Out of Date Network Security

Proper education of the do’s and don’t of social media sites can only go so far.  Providing your company’s network with up to date protection software is very important in the aid to protection from viruses/hackers.

 Mobile Phone Apps

In a time when smart phones and mobile phone applications are more popular than ever, so is the malware that comes with them.  People store a ton of information in their cell phones and with the increase of malicious applications, his is becoming very dangerous.  With companies providing smart phones for employees, this can end in a damaging result by access to important company info.   In March 2011, Google had to remove 60 applications from its market that were carrying malicious software.

 Lack of Social Media Presence

Have you ever heard the saying “even bad publicity is publicity?”  This relates to the fact that even though your company might not choose to be part of the social media world, it might still have a presence.  Your company is probably being talked about somewhere online already, whether it is good, bad or ugly.   By being involved with social media, a company can manage or defend what is being said about it on the web.  Being able to react or respond to the negative and the good talk online is necessary.  

 Employees

Sometimes even having a social media policy cannot stop employees from writing or posting something online that can leave your company in a negative light.  The best approach to this is to make sure your employees are well rehearsed on the consequences for not following policy and rules while hoping for the best!

 What are your companies doing to prevent damage through social media?  Have you seen any of the above threats in your workplace?  Do you have any advice towards the proper usage of social media?

Businesses and marketers are constantly looking for new ways to attract the consumer eye. We are constantly following new fads and technology, however; whether your mail is read or not can be as simple as the color and graphics choice.  We came across an interesting study on the effects of print on mood and behavior of the consumer.  In April 2010 research company, Leflein Associates developed a study on the causes to mail being opened and read or going simply overlooked.   

The study, with a total of 1,500 US participants, involved the viewing of multiple screens filled with the graphic depictions of 4 envelopes on each screen.  Each envelope had different text, graphics and color on both the front and back of the envelopes.  The study found that these three aspects of print hugely influences the consumer’s behavior to open mail. 

 The study found:

Being creative goes a long way.

-Consumers are 69% more likely to open mail with graphics and color on the front of the envelope than those without. 

-If choosing between a mail piece printed with color graphics or black and white text, the consumer was 2.5 times more likely to open the mail piece with color graphics.

 The back of envelopes doesn’t affect the consumer’s behavior to read mail as much as the front of an envelope.

-57% of the participants mentioned to hardly ever notice what’s on the back, however; the study proved envelopes with color and graphics on the back to go noticed more often than black and white text

Consumers prefer physical mail over digital.

-Catalogs- 66% prefer physical mail over digital

-Bills/Invoices- 61% prefer physical mail over digital

-Financial/Bank Statements- 59% prefer physical mail over digital

 Now we ask you:

What are you doing to catch your consumer’s eye? Are you using color and graphics? What is of the most creative ways you were influenced to open a piece of mail? 

With all of the hype on QR Codes, we thought we would do a little investigating on just how effective this new fore or marketing is. We bring to you the facts based on two studies and encourage your thoughts and comments.

Just what is a QR code?
A QR (Quick Response) Code is a scannable 2D black and white square image that can be found in direct mail, print advertisements, signs, billboards, and even television. All QR Codes can be scanned with a smart phone. They are designed to promote anything a company desires such as a special offer or just to attract web traffic or build brand awareness. They were designed as yet another way to penetrate the market by targeting the 82 million users of smart phones.

In this time of QR Code-mania, we ask if QR Codes are a fad or a form of marketing that will stick around forever?

We bring you data from two studies so that you can make your own decisions on QR Codes.

The following are results from an August 2011 study done by strategic marketing firm, Russell Herder:

• QR Codes although growing in popularity might not be fully understood by the consumer market. A total of 72% of consumers have seen QR Codes around however not all know what they are. Seventy Percent could explain what a QR Code is, the other 30% could not.

• Although there may be lack of complete knowledge of QR Codes there definitely showed to be consistency in the usage of them. Four in five users have scanned a QR Code more than once.

• QR Codes tend to be more popular with Generation X and Y. Those that know and use QR Codes tend to be between the ages of 18-34 and are generally male. They use their smart phone regularly to go online. One in five smart phone users between the ages of 18-24 have scanned a QR Code while one in four smart phone users between the ages of 25-34 have scanned one.
• QR Codes are favored to be used at some point. Of those that own a smart phone and know what a QR Code is, 54% said they will try scanning a QR Code at some point.

Below you can find the results from a June 2011 study by Comscore, a global leader in digital business analytics:

• In the month of June alone, 14 million Americans scanned a QR Code with their mobile device (6.2% of the smart phone owner population)

• Out of 14,452 people, QR Codes on printed magazine or paper was the most scanned (49.4%) and a majority of consumers scan from home (58%)

Now we ask you:

How are you building awareness for QR Codes? How can we make sure QR Codes are valuable? What kind of ROI are you personally seeing with your clients?

With the green and sustainable movement at the forefront of consumers’ minds, printed paper is facing a challenge.  More than ever, print is being seen and portrayed as a negative impact on our environment and a lead role in deforestation.  Due to the abundent misconceptions about print, Printing Industries Assoc. of Southern California has designed an educational campaign to promote the value, truth, and facts about print.  The “Choose Print” campaign breaks down misconceptions of the effects of print on our environment, proving that print is a renewable, recyclable, and sustainable environmental choice! 

Misconception 1:

Print “kills trees” and therefore, printing less and using less paper helps the environment.

Truth:

Paper is a renewable source.  Fifty-Six percent of forested land in the U.S. is privately owned.  Of this privately owned land, most are tree farms. A “Tree farm” is land that consists of trees grown specifically for the use of making paper.  The trees are grown as a crop just like corn or any other produce and once harvested, new trees are planted to start the process over.  Not only is this a sustainable way of producing paper but it gives landowners incentive to renew forests. 

The second truth to this argument is that most printed paper is recycled and used to produce more paper, construction products, and consumer goods. Two-thirds of all fiber used to make paper is derived from recycled paper and residue from sawmill and forest operations. This number is also growing as there are now more locations to recycle printed paper.

 Misconception #2:

Print production causes pollution.

Truth:

There are many new technologies that are reducing the use of chemicals in the production of print.  Examples are: low to no-chemistry plate development, vegetable based inks, and isopropyl-free fountain solutions.  It was found that in 2009, the print and publishing industry only accounted for 0.29% of chemicals released by U.S. Industry.

Misconception #3

Electronic forms of communication are more environmentally friendly than print.

Fact:

We forget to acknowledge that energy usage is a huge role on the environment.  The U.S. relies heavily on the use of electricity, especially now that almost everything is going digital.  The majority of this electricity usage is derived from non-renewable fossil fuels.  According to the United Nations, the pulp and paper industry is the largest user of renewable energy sources based on wood. Sixty-Five percent of the energy in the production of paper in the U.S. is from renewable-energy. 

The Choose Print Campaign provides us with facts and thought provoking concepts to fight the scrutiny of printed paper on our environment.  The truth is print works.  Studies have shown that 80% of families scan or read the printed mail they receive.  It has also been proven that 39% of new customers tried the business based on printed advertisements, and 70% renewed business based on a mail promotion.  Print is a vital part of the communication process whether that be for marketing or general business practices. Visit chooseprint.org and get involved. 

What are your thoughts on the image of print?  What are you doing to fight back against the negative thoughts about print?

The holidays are upon us!  With gift giving and holiday dinners, the holidays can put a damper on the wallet. Don’t worry Printing Industries Credit Union has you covered!  This holiday season PICU is offering low cost solutions to your holiday expenses.  

Going on now and lasting until December 31, 2011 PICU has four great holiday opportunities to take advantage of:

• No fees on MasterCard Balance Transfers for 12 months- APR of 3.99%
• Loans with an APR of 9.99% for 36 months- $32.26 monthly payment per $1,000 borrowed with a max loan amount of $3,000
• Automobile Loans (New and Used) with APR as low as 3.99% for 36 months (rate depending on down payment). 1% lower APR than other current Credit Union rates for up to 72-month term.
• 1% APR lower rate than current Credit Union rates for 72-month long term on personal loans 

Start saving now and fill out PICU’s holiday loan application or click here for more information on PICU’s holiday offers.

The Printing Industries Credit Union is the financial institution for the graphic arts industry. We provide many of the same services that commercial financial institutions do, with one important difference – the Credit Union is owned by our members. As a PIA San Diego member, Printing Industries Credit Union is available to you and your family.

Deposit Services Include:

• Savings Accounts
•  Low-Cost Checking Accounts
•  Convenient ATM’s & Shared Branching
•  Certificates of Deposit
• Individual Retirement Accounts (IRA’s)
• Direct Deposit & Payroll Deduction

Lending Services Include:

•  New & Used Vehicle Loans (purchase or refinance)
• Personal Loans
•  Motorcycle Loans
• Recreational Vehicle Loans
•  Savings Secured Loans
• PICU MasterCard

Convenience

The Credit Union is easily accessible to members any time during the day and night. With over 600 Credit Union Shared Branch Service Centers in the United States, 200,000 ATM’s throughout the 50 states, Canada, Puerto Rico, United Kingdom and the Virgin Islands and 24-hour telephone account access, the Credit Union is always available for your banking needs.
Federally Insured Safety

Printing Industries Credit Union is owned by its members and is federally insured to $100,000 by the National Credit Union Administration (NCUA) a US government agency. IRA accounts are insured separately to another $100,000 by the agency.

Are you already a member of PICU? Are you taking advantage of PICU’s great holiday offers?

As we mentioned in one of our past blog posts, USPS Needs Reform Now For a Better Tomorrow, the USPS is facing hard times that we believe must be resolved by reforming.  It is now well into November and the USPS  is projected to end the year with a loss of $14.1 billion.  The US Postal Service, who is said to “run out of cash or be dangerously close” by September 30, 2012, according to Chief Financial Officer Joseph Corbett, might be exploring the idea of hiring an outside adviser to aid in the reformation process.  Harry Wilson, founder of MAEVA Advisors LLC, explains the hiring of a firm:

 ”The Postal Service faces a difficult challenge and unless they hire the best in the business a restructuring may fall flat. In public sector restructurings, threading the political needle is as important as coming up with a great business solution.”

The USPS, finds themselves unable to make the $5.5 billion payment due Nov. 18 to the U.S. Treasury for future retirees’ health benefits.  This payment is just one small portion of the 2006 plan that congress mandated stating that the USPS pre-fund its retiree medical system on an accelerated schedule. In the severe recession we have faced, these payments have assured the USPS incurs annual deficits and in result USPS is looking to cut 220,00 jobs by the year 2015 along with the closing of 3,700 post offices. 

USPS spokesman, Dave Partenheimer declined to comment on whether or not the working with restructuring advisors. 

While we will keep following the advancements in the postal reform, we encourage you to read what PIA|SD and the rest of the members of the Coalition for a 21st Century Post Service have come up with. (Read our statement) 

We also encourage you to visit savethemailsavejobs.org.

Are you following the postal reform? What are your thoughts?

PIA|SD found information on this blog topic at bloomberg.com in an article titled, “USPS Weighs Hiring Restructuring Advisers,” written by Jeffrey McCracken, Jonathan Keehner and Angela Greiling Keane.

As we mentioned in one of our past posts, “Can You Smell What Direct Marketing is Cooking“ a new form of advertising is becoming more popular: sensory advertising. Marketers are now focusing on appealing to consumer emotions through the five senses.  One way of doing this is taking advertisements a step further than the standard white envelope and making mailers 3-dimensional.  In a recent article found on whattheythink.com entitled, Three-dimensional Marketing… Gifts that Deliver Response Rates for Marketers, Barb Pellow explains all about this new form of direct marketing and why it’s working. 

Part of the struggle of marketing is breaking through the clutter.  Think about it: How many advertisements do you think consumers receive daily in the mail? Imagine this: An advertising letter that pops up, or a clear tube with a roll-out coupon inside.  Consumers need something to catch their eye, something that differs from the rest.  Why do you think kids love pop-up books?

Another thought: half the time mail goes unopened.  A direct mail piece bulkier than the rest of the white #10 envelopes that engulf the consumer mailbox will get opened and read.

Pellow uses a successful 3D campaign by Structural Graphics to prove 3D marketing works. Structural Graphics is a Connecticut based marketing firm who recently tested different 3D-mailer campaigns. One campaign in particular proved to be very successful. Structural Graphics put together a campaign for eyeglass lenses provider, Essilor, to promote one of Essilor’s new lenses, the Varilux. In the dimensional direct mailer, Structural Graphics’ goal was to engage consumers in an online sweepstakes in which the prize was the new Varilux product. The direct mailing piece was a cube which unfolded to reveal different information of the product and sweepstakes on each panel.

The Essilor campaign achieved great results. 1,748 entries to the sweepstakes were received, (23.6% of those who received the mailer). Of these entries, 701 were unique participants (9.5%).  Of those participating, the average amount visited the website was three times with 3.68 pages viewed per visit. 

If this isn’t a good enough example of why dimensional direct mail is working, statistics have proven it as well.  Pellow mentions:
“According to the DMA’s ’2010 Response Rate Report,’ dimensional mailings (non-flats in boxes or large packages, often containing samples or gifts) had an average house file response in B2B of 8.51% and 3.52% for business-to-consumer (B2C). In that same report, letter-sized envelopes, for instance, had a response rate of 1.38% for a B2C prospect list.
The 2011 DMA Statistical Fact Book reported that the average consumer gets 21.8 pieces of direct mail, and direct mail represents 53 % of total U.S. mail.”

If that isn’t proof, we don’t know what is.

What are your thoughts on dimensional direct mail?  Are your companies trying it?

Read Barbara Pellow’s article, Three-dimensional Mailers…Gifts that Deliver Response Rates for Marketers.

Watch out consumers, sensory stimulating mail is coming your way soon! In Deliver Magazine’s October 2011 issue, an article titled “An Appeal to the Senses,” Lekan Oguntoyinbo discussed the new trend hitting direct marketing. Marketing companies are now focusing on appealing to consumer’s senses and they are hitting all five: taste, smell, sight, sound, and touch.

Jay Minkoff, President of Philadelphia marketing firm First Flavor, explained why sensory advertising is becoming so popular. “The more senses a brand uses, the more memorable and engaging to a consumer. Those distinctions are becoming more recognizable by marketing agencies and their clients.” Minkoff’s company recently distributed a “flavored filmstrip” which dissolved in the mouth to consumers in order to evaluate a client’s new soft drink. Seventy-Six Percent of those that tried the flavored strip reported “likely or somewhat likely” to purchase the product within the next week!

Another recent marketing piece appealing to senses was direct mail campaign from TruGreen, a Memphis based lawn care company, featuring postcards with the peel-off scent of fresh-cut grass. The postcard read “For the smell of a healthy lawn, peel here.” The approach was used to change consumer perception. “As a lawn company we wanted to change the conversation from killing weeds to lawn enjoyment,” according to Amy Simpson, director of brand communications.

Sight and sound are also being utilized in direct mail with embedded moving images and mail pieces that literally speak to the consumer! A health club sent out postcards that opened to the automated voice of “Dan,” a personal trainer who spoke about the amenities of the health club.

Touch is sometimes seen as the greatest benefit ink on paper – and marketers are getting creative with new capabilities. A marketing firm produced a tactile campaign for a local restaurant, mailing postcards that look and felt like plastic credit cards with high-end personalization and a practical customer buy-in. The campaign yielded a 30% ROI!

Marketers are starting to catch onto the idea of using the five senses in their direct mail pieces but cost is still a major concern. mailPOW’s CEO, Crystal Martin, explains that “the moment they pick up a sample and listen to it they have an emotional reaction. Any time you can make someone have an emotional reaction to a marketing piece, you now have top-of-mind awareness.” That kind of impact is why sensory marketing is well worth the investment.

What are your thoughts on sensory marketing? Is it something that you and your company would be interested in?

Check out Lekan Oguntoyinbo’s full article in the October 2011 issue of Deliver: A Magazine for Marketers. You can also find the article here or visit the Deliver website to subscribe to the magazine.