Meeting The Challenges Of New Competition
In the August PPB article “Differentiate To Compete,” Mark Graham, founder of RIGHTSLEEVE and co-founder of industry software platform commonsku, wrote that the “price is everything” philosophy no longer works for promotional products businesses, and to successfully compete in today’s market, industry professionals must know their customers’ dreams, understand their competitors’ weaknesses and focus on their own key points of differentiation.
Coming from the office supply industry, this feels like déjà vu. When the three big-box companies entered the office supply market, many small [companies] reassured themselves that their good customers would never leave them; that customers appreciated their expertise and personal service, and that they loved placing orders the old-fashioned way. They listened to industry experts who told them to get rid of their bottom-feeding customers and to do what they were doing, only better, with their loyal customers. Note that the number of office supply dealers is a fraction of what it was 30 years ago.
The promotional products industry is at a watershed moment right now with the internet set to disrupt our industry the same way it has others. To ignore that fact and say ‘keep doing what you are doing, only better’ is futile. This fragmented industry with relatively high margins is ripe for the creative destruction that is happening before our eyes.
Promo distributors that do not do business the way their customers want to—online, user-friendly self-service—will be competing for a shrinking share of the market. Those promo distributors that do not improve at merchandising and competitive pricing strategies will go the way of Ben Franklin [stores] after Wal-Mart came along.
What our industry needs are technology providers with the vision to create ecommerce solutions that our customers can use to place orders from beginning to end, and to partner with suppliers for good product data feeds. Then distributors can go out and do what we do best—build relationships that count. And when customers want to, let them transact their business with us online.
Imagine if your sales force spent more time helping customers create marketing and promotion campaigns and less time sourcing and ordering pens, mugs and t-shirts; more time acquiring new customers and less time finding the cheapest presentation folder.
The good news for office supply resellers is that this is what happened. The industry is tough but almost 5,000 companies compete everyday and in the markets we are in we beat them regularly. We can now do everything they do: convenient online ordering and competitive pricing, and beat them with the advantages we have as owner-operated local companies.
Give Back KC Ink
Thank you for addressing this issue. As a regional salesperson calling on distributors in my territory, I tire of hearing this lament. I believe that suppliers are sometimes blamed for the Goliaths receiving better pricing than the Davids and that’s not the case. You hit the nail on the head when you suggested, “Get rid of this client as they value price above everything else …” when dealing with those price-shopping clients. Those clients have programmed their vendors to keep their margins low and their creativity at bay. And really, isn’t utilizing our creativity what it’s all about?
Kim Reinecker, MAS
Regional Sales Manager
Starline USA, Inc.
Recognizing The Importance Of Sensory Media
The July issue of PPB featured an excerpt of the book Sensory Media by Jae M. Rang, MAS, chief inspiring officer of Oakville, Ontario-distributor JAE Associates Ltd. Her book captures years of study on the mind and human behavior relating to promotional material.
This is a great piece with content I’ll be using for my upcoming presentations. I have been speaking on Five Sense Branding for the past year at shows and with regional associations about this exact subject. Martin Lindstrom is another well-known author on sensory branding and I also incorporate his content and stats into my presentations.
Thank you for raising the awareness in PPB’s July issue. We, as an industry, have the medium that helps bring greater value to traditional forms of advertising and social media.
Chris Piper, CAS
Regional Vice President, Northwest
HALO Branded Solutions