Customers view print and mail service providers as interchangeable. When they do that, the only distinguishing factor from the customer point of view is price, which means outsource service providers must undercut their competitors to get the business. This is an unsustainable business model that eventually leads to buyouts and consolidations.

I don’t think many consistently successful businesses got that way by copying the competition. Since print and mail service providers all offer similar services, separating your organization from the pack involves assessing how you provide those services, to whom, and how much value you can add.

Value-added services come in several varieties:

• Print-related services enhance the printed piece itself, such as adding color, data-driven graphics, or outside envelope printing.
• Mail-related services improve the performance of mail, such as deceased and prisoner suppression, mail tracking, Informed Delivery, householding, or enhanced move update.
• Other value-added services can include things like graphic design, multi-channel distribution, and customer access to portals that enable online proofing, job and piece tracking data, or job hold and release.

Obsessing on alternative ways to reduce print/mail production expenses to match the price of a low-cost competitor is not where you ought to spend all your time. Instead, determine what sets you apart. How does what you deliver or how you do it add value to the print/mail applications you run?

More of the Same

When asked what differentiates their companies from the competition, many CEOs cite great products and fantastic customer service.

The trouble is that nearly ALL companies in a particular industry have great products and excellent customer service. Customers expect those qualities, along with timeliness and accuracy, from ANY print/mail service vendor. Great products and a passion for customer service aren’t differentiators at all. When everyone is saying the same thing, the customers stop paying attention. To separate your company from the competition, you need something else.

How to be Different

Deciding what to do isn’t easy, but whatever your strategy, you must communicate the added value to your customers and shift your sales presentations away from price. Consultative selling to executives and marketing people differs from the transactional approach your salespeople have traditionally used to interact with print buyers. Education and training may be necessary to make the switch.

One way to differentiate your organization is by focusing on niches, such as certain industries. You can develop a deep understanding of the challenges an industry faces and supply your customers with industry-specific solutions they need to solve their business problems.

Back in my service bureau days, we ran lots of different print and mail applications. But two of them, credit union statements and legal notices, accounted for a majority of the revenue. We became experts in servicing those markets and developed a reputation within those communities. Word spread and we attracted new customers via referrals. We became leaders in credit union document processing and legal notice mailing because we concentrated on becoming experts in serving those two markets.

Identifying differentiating factors in your business may be difficult, especially in an industry crowded with competitors. An approach that might work is to focus on things your competitors don’t do very well. What practices drive customers crazy in your industry? Maybe it is long lead times for document updates, or distaste for multi-year contracts, for instance. What can you do to solve these problems that customers encounter with most of your competitors?

You can add value by including some extras. Ideally, these extras will be something of value that doesn’t increase your variable costs. You might offer free, customer-only online courses on the basics of USPS services or publish a series of PDF eBooks about planning and preparing variable data print jobs. The print/mail work you do for your customers may be the same, but the way your customers perceive you sets you above another print/mail service provider—even one that offers lower prices.

Avoid Price Competition

I think the era of pitching cost savings as the primary approach for attracting new clients is over. Of course you should take advantage of equipment or software upgrades that lower your costs. But the message to customers and prospects should be heavily weighted towards the unique things your company can do to help your customers achieve their overall business goals. Don’t talk about price until after you know what those goals are and can align your strengths with customer objectives. Then the results become more important than the price.

Mike Porter at Print/Mail Consultants creates content for the document industry and helps document operations build and implement strategies for future growth and competitiveness. Learn more about his services at www.printmailconsultants.com and www.pmccontentservices.com Follow @PMCmike on Twitter, send a connection request on LinkedIn, or contact Mike directly at mporter@printmailconsultants.com.