I am in the office, doing some final planning for 2010, and I found a great article from the Print CEO that I wanted to share with you (I have added the BOLD to some key ideas).

By David Dodd on December 28th, 2009

Is the worst over? Maybe

Recent forecasts by leading media companies and industry consultants suggest that the worst of the recession in the advertising and marketing industry may be over.  However, many of the same forecasters are saying that the growth of advertising spending will be painstakingly slow over the next five years.

According to Publicis Groupe’s ZenithOptimedia, North American advertising spending will decline from $157 billion in 2009 to $153 billion in 2010.  WPP’s GroupM estimates that spending will fall from $155.8 billion in 2009 to $149.6 billion in 2010.  Longer term, Interpublic Group’s Magna projects that U.S. media-supported advertising revenue will grow at a compound annual rate of only 1.2 percent between 2009 and 2014

Meanwhile, Winterberry Group, a management consulting firm specializing in the advertising and marketing services sector, is seeing a continuing shift in marketing spending from traditional “above-the-line” advertising channels (television, radio, newspapers, magazines, etc.) to “below-the-line” direct and digital channels (direct mail, teleservices, digital, etc.).  In October, the firm estimated that above-the-line spending in the U.S. would total $128.4 billion in 2009 and $126.4 billion in 2010, while below-the-line spending will grow from $149.9 billion in 2009 to $152.6 billion in 2010.  Winterberry Group also estimated that spending on direct mail in 2010 will be essentially flat compared to 2009, while spending on digital marketing in 2010 will increase by 8.7 percent compared to 2009.

Marketers are also becoming a little more optimistic about marketing spending in 2010.  In a recent survey of business-to-business marketers conducted by BtoB magazine, 39.2 percent of respondents said they plan to increase marketing budgets in 2010; 47.5 percent of respondents plan to hold marketing budgets at 2009 levels; and 13.3 percent plan to decrease marketing budgets in 2010.  This represents a significant improvement over 2009, when 57.7 percent of survey respondents cut their marketing budgets.

Based on this as well as other recent research, it appears that overall advertising and marketing spending will grow only slowly over the next few years.  There are at least two reasons that spending will be restrained.  First, with the overall economy expected to recover slowly from the “great recession,” it’s difficult to see how marketing spending can increase rapidly.  And second, marketers will continue to shift spending to less expensive and more measurable marketing channels and tactics. So, spending on digital marketing channels and tactics is likely to grow much more rapidly that overall advertising and marketing spending.

So, I leave you with a bit of optimism to end the year with, and start 2010 off with a fresh outlook!

(part 2 in a series)

As mentioned in my earlier post – historically, people who buy printing often look to obtain cost savings by focusing on three distinct areas: process, production and distribution.  We understand now that these three areas need to be looked at as a “whole” to achieve true, lasting cost savings.

In order to do that – we need to look at what the true costs are. In a study by industry analyst Cap Ventures, they found that for every $1.00 spent on “print”, only $.24 of that is attributable to the final product:

So, now that you have that knowledge, here are some questions to think about:

• Does your vendor have the ability to help you with design? Copy? Photography? Can they act as an adjunct to internal resources or external agencies?
• Does your vendor have any tested systems in place to help manage “rouge” or “maverick” buying?
• Would the introduction of a POD or Hy-POD model help with your obsolescence?
• Does your vendor offer any distribution solutions? If so, are those solutions local, regional, national or global? And, are their solutions capable of merging with your current distribution footprint? (In other words, if you ship 90% of your product to the west coast, you are on the east coast does it make sense for an east coast vendor to store and ship your products?)

I think that in this day and age, in order to achieve any sort of lasting cost savings, you have to be willing to step outside of your comfort level. ask you current vendors some challenging questions and be willing to partner with them if they are in fact a best-in-class provider.

Questions? Drop me a note.

UPDATE: Someone asked if they can get a copy of the pie-chart in an .xls format – yes, drop me an email and I will send it off to you!

(part one is a series)

I had the chance to meet with a client last week for an informal review of their 2010 goals as they relate to marketing communication (MarCom as they know it). A major point of conversation was cost reduction. What can they do to reduce costs, increase speed to market and not compromise their “brand Integrity” in doing so?

In the past, cost savings initiatives have focused on reducing the cost of materials, and the cost of manpower. But many companies have exhausted these methods, already having put as much pressure on vendors as possible and have reduced the cost of materials to the point of potentially affecting the final quality, and ultimately risking the image of the brands they are trying to promote. And, they have downsized already overtaxed procurement and art departments to the bare minimum.

Looking at this challenge in today’s marketplace, we are forced to look for initiatives that may not be as intuitive and obvious, or may seem complicated or difficult to implement quickly or economically. Cost savings opportunities can be found at every stage of the brand communication life-cycle, from the earliest marketing strategy to final printing, fulfillment and distribution. This is largely because upstream decisions affect execution downstream. When brand managers, procurement professionals, designers and printing solution providers have collaborated in planning – when they share technologies designed to streamline and strengthen the process – there is a cumulative lasting effect of cost savings. This integration is integral to brand communication management. Let’s consider the three key opportunities for cost reduction along that life-cycle:

Historically both the client and the vendor understood that these three areas were strongly interrelated, but looked at them as unique opportunities for cost savings. In today’s market, we need to look at them as a whole, and we need to understand that where the three intersect is where true cost savings can be found.

Questions? Drop me a note!

(As mentioned in a previous post, from time to time,  I will be posting case-studies made available to me as a solutions provider for CGX. I will be deleting the “client” name, the “vendor” name will of course be left in. These posts are intended to show a unique solution to a complex problem and to show you what is possible when you think outside the box and partner with a best in class solutions provider.)

The Challenge: (Client) sought a solution that would enable them to present academic testing results for all students in grades three through eight across an entire state, in a clear, attractive, personalized manner that would be more meaningful to and engage parents. To do so, they needed more than four million pages, presenting different and unique data on every page, printed multi-color, packaged and delivered to 3,700 locations – all within a two week time frame from receipt of the data to meet a state-mandated delivery date.

The Solution: With unmatched variable data printing capabilities, including the largest installed capacity of Xerox iGen3 presses in the industry, Consolidated Graphics proved to be the most viable option for this huge, time sensitive project. Awarded the project in January, Consolidated Graphics immediately marshaled its resources and began meticulous preparations to ensure flawless execution. To achieve pinpoint coordination among nine Consolidated Graphics facilities in seven states, processes were developed and tested, and digital managers from each location convened for training. As the launch date approached, the necessary paper was purchased, received and staged, and delivery logistics were established and confirmed with a national freight and delivery company.

The Results: The project, unprecedented in its size and complexity, represented the ultimate test of variable data printing across multiple locations, and Consolidated Graphics passed with flying colors. 4,500,000 pages of individualized test data came to life in attractive, color reports with separate versions for educators and families. The reports were printed accurately, packaged correctly and delivered to the right locations – all 3,700 of them – within the two-week time frame, many even ahead of schedule.

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Not many clients or prospects will ever have a need for a project of this scope – what I like best about this case study is that it highlights what I feel is often the most overlooked aspect of any project – advanced planning and staging. By configuring this project to print at multiple plants (the one I work out of was one of the 7) at the same time – we were able to maximize productivity, shop-load, quality and meet our SLA’s. So, next time you have any project – large or small – talk to your vendors – keep them in the loop, let them help you meet your delivery dates and quality requirements.

Questions? Drop me a note.

“Corporate sustainability programs are reaching into marketing budgets and impacting marcom spend significantly. For companies with trade shows in their marketing mix, lowering the carbon footprint of their participation is coming under fire and several have made significant changes in their involvement that will directly affect show management as well vendors supplying them. Any organization counting on the business generated by clients’ trade show participation should take heed.

Many companies are evaluating how they present themselves at a trade show, how many people are really required, and what is truly necessary to have in the booth. Many are integrating green elements into booth construction, appraising which products and sales teams need to be present and incorporating green messaging….” read more (from Printing Impressions).

“The desire by a majority of Americans not to be followed for the purpose of tailored content comes at a time when behavioral targeting is a fast-growing advertising practice.

From: Print In the Mix

Date: 2009

Authors: Joseph Turow, Jennifer King, Chris Jay Hoofnagle, Amy Bleakley, Michael Hennessy

Type of Promotional Material/Activity Tested:

Americans’ opinions about behavioral targeting by marketers.  Behavioral targeting involves following users’ actions and then tailoring advertisements for the users based on those actions.

Sample population:

1,000 US adult Internet users. A combination of landline (n=725) and wireless (n=275) random digit dial samples was used to represent all English speaking adults in the continental United States who have access to either a landline or cellular telephone.

Methodology:

Telephone interviews were conducted from June 18 to July 2, 2009 by Princeton Survey Research Associates International. The interviews averaged 20 minutes. The overall response rates were a rather typical 18% for the landline sample and 22% for the cellular sample. Statistical results are weighted to correct known demographic discrepancies.  The margin of sampling error for the complete set of weighted data is ±3.6% at the 95% confidence level. The margin of error is higher for smaller subgroups within the sample.

Top Line Results:

• The majority of adult Americans (66%) do not want marketers to tailor online advertisements to their interests.

• When Americans are informed of three common ways that marketers gather data in order to tailor ads (what you do on the website you are visiting, what you did on other websites you have visited, what you do offline–for example, in stores) even higher percentages–between 73% and 86%–say they would not want such advertising.

• The survey finds that younger adults are less likely to say no to tailored advertising than are older ones. This said, more than half (55%) of 18-24 year-olds do not want tailored advertising.

• Young adults express as strong an aversion to being followed online and offline as do older adults. Nearly seven of 10 (67%) 18-24 year-olds say they don’t want tailored advertising if it is based on tracking them on the website they are visiting, 86% say they don’t want tailored advertising if it is based on tracking them on “other websites” they have visited, and 90% reject it if it is the result of following what they do offline.

• When told that the act of following them on websites will take place anonymously, respondents’ aversion to it remains high: 68% “definitely” would not allow it and 19% would “probably” not allow it.

• A majority of respondents also do not want discounts or news fashioned specifically for them, though the percentages are smaller than the proportion rejecting tailored ads.

• Seven of 10 (69%) respondents feel there should be a law that gives people the right to know everything that a website knows about them.

• More than nine of 10 (92%) agree there should be a law that requires “websites and advertising companies to delete all stored information about an individual, if requested to do so.”

• Six of 10 (63%) people surveyed believe advertisers should be required by law to immediately delete information about their Internet activity.

• The survey finds that Americans mistakenly believe that current government laws restrict companies’ rights to share and sell information about their activities — both online and offline.

Take Away:

“The desire by a majority of Americans not to be followed for the purpose of tailored content comes at a time when behavioral targeting is a fast-growing advertising practice upon which many content providers have staked their businesses … Americans’ widespread rejection of relevant tailored advertising is particularly startling because it flies in the face of marketers’ consistent contention that Americans desire for relevant commercial messages justifies a variety of tracking activities. When three contemporary forms of behavioral tracking are highlighted, rejection of tailored ads is even more widespread. The finding applies across all age groups, including young adults, a cohort that media executives have insisted cares little about information privacy.”

Read the entire study here (a PDF will open)

Those of us in sales often look upon November and December as the two biggest sales months of the year. Not so much because of the volume of work, but because these months are looked at as “planning” months for the next calendar years activities. What are our customers needs going to be? How can we help them meet those goals? What will our product mix be this year compared to prior years? What do we need to do to continue to be a good resource to our clients and help them meet their goals? With the PIA  predicting a 2.5% drop in print sales next year (on the heels of a 4.5% decline in 2009),  the number of US printing plant closures at an all time high (the number of plants falling by 18% this year alone), and the report only yesterday that October shipments were down 13%. We as printers* need to be even more diligent in our planning.

I am building my 2010 plan around these 5 key assumptions:

• My clients will have to deal with a continued spate of fiscally unstable printers, and plant closures. Short term, that means that they will be benefiting from what I like to call “unsustainable pricing”. The good news? This level of pricing in not sustainable. The bad news – the value of what we print will be forever reduced in the eyes of our customers.

• With the number of opportunities decreasing, the average print buyer/marketing executive will become even more inundated by printers “cold-calling” to get the chance to “quote” on a project (those reps without a plan will simply rely on “making more calls”)

• With the increased workload being put on the shoulder of print-buyers/marketers, now more than ever they will be considering a single source solution for their communication needs. Seem far fetched? Look here (a PDF Doc will open).

• Printers will be scrambling to re-invent themselves. Hey – look at us – we do PURL’s, we are a marketing firm! Look over here – we do e-Brochures, we are multi-media experts! Hey – we have mailing in house – we are now data experts! Look – our pre-press department is slow – we can design that for you! This re-invention will create a confused market place. Who are THE experts in any given arena? And, more importantly, how will the client know the answer to that question?

• Sustainability; it has been a been a key issue on the west coast for the better part of three years and is now catching on in the mid-west and east coast. Now that it will be the “assumed” that every player is going to have at least one sustainable COC certification, How will we continue to differentiate ourselves as printer’s in this arena? And, can we quantify those statements?

So, with those key assumptions, I continue to build my plan for 2010. Will my plan be effective? Only time will tell.

Are you a print buyer? A designer? A marketer? A Printer? How do you my assumptions sound to you? What challenges are you facing that I am not seeing? How can a printer* do their job better in 2010 to help you meet your goals? Leave me a comment, or drop me a note – I am going to post some more thoughts – and will include any great ones that I missed!

Drop me a note, let me know what you think!

* I am using the term “printer” in its most simplified form, understanding that we must be well versed in all disciplines of marketing communications to be successful now and into the future

Courtesy of Print in the Mix

To understand what marketing messages and channels of delivery were most valued by today’s customer, Chief Marketing Officer (CMO) Council and InfoPrint Solutions Company undertook a survey of nearly 1,000 US consumers. The results show that regardless of channel, for consumers, relevancy and individualization of the marketing message is what is valued.

Key findings of the consumer engagement study highlighted in the report, Why Relevance Drives Response and Relationships: Using the Power of Precision Marketing to Better Engage Customers, shows that:

• When given the opportunity to choose, 51% of consumers prefer to receive product or service promotions via traditional mail while 44% prefer email.

• Nine out of ten consumers open monthly bills delivered via traditional mail, compared to 72% who open bills delivered via email.  For all types of mail received, print mail is opened and viewed more than electronic mail.

• Three-quarters (73%) of consumers say they would you opt in for more traditional mail vs. electronic statements if the government certified that mail had less environmental impact than electronic delivery.
• Consumers are inspired to do business with a retailer after receiving personalized offers — 30% of respondents answered “yes” and 48% stated “sometimes.”
• While 64% of consumers say promotional offers dominate both the email and traditional mail they receive, only 41% view these as must-read communications.
• Of the 91% of consumers who opt out or unsubscribe to emails, 46% do so because the messages are not relevant.
• Four out of ten (41%) say they would consider ending a brand relationship due to irrelevant promotions–whether print or email.  An additional 22% say they would definitely defect from an offending brand.

“Irrelevant, impersonal communications, be it email or traditional mail, is a waste as it does not engage a receptive recipient,” said Liz Miller, Vice President, Programs and Operations, CMO Council.  “It is no surprise that consumers are opting out of irrelevant emails. However, what is a grave sign for marketers to heed is that customers will disconnect and stop doing business with brands who continue to send messages that demonstrate a lack of intimacy, customer insight and individual understanding.”

Questions?? Drop me a note.

Sources:  DMNews, Ad noise can drown brand loyalty, says CMO Council study, November 17, 2009 and CMO Council, Irrelevant Communications Contributes To Customer Defection and Alienation, November 17, 2009.

The Power of Personalization: The Impact + Influence of Individualized Content Delivery

(from Print in the Mix)

“The majority of marketers who have implemented strategic personalized marketing techniques have seen decidedly greater success over traditional mass marketing approaches.”

Date: March 2008
Type of Promotional Material/Activity Tested:

Implementation and integration of personalized communications through such media as e-mail, personalized URLs (PURLs), digital advertising, direct mail, dimensional mailers, newsletters, transpromotional documents and more.

Sample Population:
Over 700 senior executives ranging from CEO, CMO, SVP and VPs of Marketing from across technology, Internet, telecommunications, media, professional services, banking/ finance, retail, consumer goods and manufacturing.  45% represent companies with annual revenue of $100 million or more.

Most of the survey participants were senior marketing or sales executives, though 13% were CEO or president and 27% of respondents “other” with titles, including “VP” and “Chief Strategy Officer”.

Methodology:
A twenty-four question online survey.

Metrics:

Top marketing executives insights into the various effects of customized content, collateral and personalized web interaction on marketing effectiveness, customer acquisition, retention, and business outcomes.

Top Line Results:

• Senior executives indicate that increasing customer retention and loyalty (39.4%), building ROI (37.4%), and improving response and close rates (36.9%) are the three top reasons driving personalization strategies.
• More than 52% view e-mail campaigns as the primary opportunity to personalize their customer interactions and customized website content is second at 38.8%. The majority (66.1%) currently use personalized emails in their marketing campaigns.
• Respondents rate personalization activities effectiveness:

• The top 3 personalization communication activities tested or evaluated but not embraced:

• Print–based personalization methods tested or evaluated but not embraced:

• In designing personalized communications programs, respondents cite their customers’ purchase history as their main consideration (46.8%) and yet roughly half of executives report having only “fair” to “poor” knowledge of their customers in terms of areas such as demographics, behavioral data, and transactional data.
• In examining key challenges for integrating personal communications, nearly half indicate inadequate systems and infrastructure, 46% indicate a lack of customer data/insight, and 43% sight cost and complexity.
• When asked “Has your personal communications investments performed better than traditional mass market delivery?” over 56% of respondents say that personalized communications outperform traditional mass market advertising while 5.6% say personalization has not performed better. A large number, nearly 4 out of 10, state they do not know how their personalization strategies compare to traditional marketing communication techniques.
• Personalized communication efforts are said to be effective overall by  many respondents.  However, finding an accurate way to measure and track the results remains an obstacle.
• The top 3 reported metrics marketers report using to measure the success of personalization:  conversion and close rates, e-mail opening and forwarding rates, and web site traffic and page views.
• Most marketers said they expected to increase their budget allocations for personalization in 2008:

Take Away:

“Personalized marketing techniques are still in the early stages of being integrated into most companies’ marketing campaigns and budgets. While the need for quantifiable tools for gauging effectiveness and ROI exists, marketers are also lagging on adoption due to the lack of accurate and reliable customer data sources. However, the majority of marketers who have implemented strategic personalized marketing techniques have seen decidedly greater success over traditional mass marketing approaches.”

Wanna Learn more about VDP, drop me a note.

I like to think of myself as a bit of a realist when it comes to being “green” or “sustainability’. I believe in taking a practical approach to both, and finding the balance for my clients and for the bottom line. As a former owner – I invested heavily in sustainability initiatives; from being the first tri-certified printer (FSC/SFI & PEFC) west of the Mississippi, to transitioning a traditional sheet-fed house to a state of the art Hy-Pod shop. (read more about my previous company and our green initiatives here a PDF doc will download).

As being green continues to prove to be more that just a trend, I have seen a lot of “green-washing” by competitors of all shapes and sizes – from large corporations, to the small shop on the corner. In light of this – I always advise clients to ask their vendors to see a copy of their green initiatives, or some of the green milestones they have reached. A company that has a true sustainability initiative in place should be able to provide those, and a way to track and work towards continuous improvement.

There are a lot of great printing firms, large and small, who are doing wonderful/innovative things in an effort to be “green” one in particular is the Printery in Port Townsend, WA. Mike Kenna, the Printery’s founder, is a true tree-hugger – and an innovator being the FIRST FSC certified shop on the West Coast.

On the larger scale – the company the I work for, CGX, has a robust green commitment, in my opinion, the most important and often most overlooked is the benefit our “network” can deliver in reducing emissions (see bullet #3). From CGX’s website:

Consolidated Graphics is dedicated to leveraging our strengths, talents, resources and technologies to service our communities and our customers. We are able to draw on our experience to refine the way we produce and deliver printed materials, from innovative recycling programs to our enterprise-wide Forest Stewardship Council (FSC) certification, to groundbreaking corporate partnerships that complement our sustainability initiatives.

Below is a listing of some of the steps Consolidated Graphics is taking with regards to our environmental initiatives:

• Paper Recycling – We recycled 66,633 tons of paper in FY2008 which equates to more than 199,899 cubic yards of landfill space.
• Aluminum Recycling – We recycle more than 700 tons of aluminum per year.
• Distribute and Print – Our national footprint allows us to distribute and print products closer to the delivery points, reducing emissions resulting from product delivery.
• Inks and Solvents – Nearly all of our printing inks are soy and vegetable based and less harmful to the environment, and each of our companies utilize low VOC (volatile organic compound) solvents.
• Energy Conservation – Energy efficient lighting in our facilities reduces energy consumption.
• Enterprise-wide FSC Certification – Each of our facilities utilizes FSC paper to help support a more sustainable forestry industry.

Inspire Earth is Consolidated Graphics’ private-label paper. Superior characteristics include:

• 10% post consumer waste, triple forest certification (FSC, SFI, and PEFC) and outstanding printability that equates to less waste during production and make-ready.

(note: since this report was publised by CGX in late 2008, CGX has forged partnerships with American Forests and Rainforest Alliance and my facility in Westlake Village is SFI COC certified)

want to learn more? Drop me a note.