SOI 2015 – Service Solution
Custom Ink Raises Bar In Industry
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Distributors can separate themselves from online competitors today by providing enhanced service offerings.
Thanks to Custom Ink – the DIY T-shirt company that allows end-users to become instant artists and T-shirt sellers online – the stakes in promotional products just got raised. The company and others like it that are selling custom tees and other imprinted products on the Internet have created a sea change in this industry that distributors are forced to face.
“Online companies have a way of shaking things up and forcing others to evaluate their businesses in ways they weren’t anticipating,” says Joseph Greenberg, principal with consulting firm JAG Associates. “These companies will change pricing structures and they’ll create an avenue to a new breed of buyers that may not have existed before. They’re appealing to a set of people that are most likely helping to expand the promotional products market, but in doing that, online companies are also contributing to what could end up being a permanent shift in how people buy in this industry. It’s something promo products companies need to be aware of and react to.”
In essence, Greenberg says, distributors in this industry are at a bit of a crossroads right now. Do you change your business to appeal to these new buyers, or do you figure out ways to fill voids in what online companies are offering? “It’s very difficult, if not impossible, to just turn your company into a lean online operation that can offer the lowest prices possible,” Greenberg says. “So, companies need to take a critical look at their own businesses and that of their low-price online competitors and determine what they’re not good at. The best way to compete in this environment is to give customers services and products that they can’t get at a lower price elsewhere.”
A Price on Service
That’s exactly what many distributors say they’re doing, and most are doing it through enhanced customer service offerings. They believe that the hole in online companies’ offerings is the personal service that only they can provide – and that a higher price can be attached to that service because buyers can’t receive it elsewhere.
Distributors actually say they are hustling to do the opposite of the Custom Inks of the world, to punch a hole in their market mastery by offering the one thing Custom Ink doesn’t seem to provide in spades: face-to-face customer service. For some companies, that means responding to a customer’s request at 2 a.m. For others like Marty McDonald, president of McDonald Imaging Solutions Inc. (asi/522770), it means being at any client’s door in 15 minutes or less for in-person service.
For Image Masters (asi/230071), customer service means picking up the phone “within three rings and returning a phone call within 24 hours or sooner,” says Tim O’Neill, president and CEO. “We’re all in a FedEx world,” O’Neill says.
Ultimately, these companies are finding that the better service they can offer clients, the more loyal those clients tend to become. “Increased customer service offerings are invaluable because they often result in customer satisfaction going up,” Greenberg says. “And, when clients are completely satisfied with the products and services they receive, then they tend to not look around for another vendor or shop their orders to lower-cost providers online. They just don’t even tend to think about looking for an alternate source for their orders.”
Distributors are also finding that clients today are increasingly looking for products and services that are outside the traditional realm of simply promotional products. For all the offerings distributors try to serve up to remain competitive against Web-based companies and others, there are still plenty of requests they field from clients that are out of the ordinary – some more specific and more taxing than ever.
Ali Banholzer, owner of Midnight Oil Specialty Designs (MOSD) (asi/247749), found that customers at her shop are growing accustomed to free art design and consultation – something she started offering four years ago (before Custom Ink allowed clients to upload their own logos). Doing so has earned her company a 90% return rate. “Customers are coming to me saying they want it easy,” Banholzer says. Making it easy has caused the vast majority to “return to us for multiple offers.”
That’s the kind of customer loyalty effect that Greenberg refers to as a result of enhanced service offerings. “The closer you can become to your client’s operations, the better off your business will be today,” he says. “Seek to provide consultation and services that they simply couldn’t receive anywhere else.”
Along those lines, distributors say they are increasingly providing marketing and promotional consulting services to their customers. And, with that consultative relationship comes greater demand for agency-type services, says Melissa Moritz, sales director, national accounts for TCB Promotions (asi/341156).
“Virtual proofs are becoming more the norm,” Moritz says. Offering that service pays off, though. Moritz says that 75% of her clients that receive a virtual proof from her end up placing an order. In fact, offering up renderings and consultation over an eight-week period netted Moritz a deal when a client wasn’t even in need of a promotional item. But, the client was so impressed by a virtual sample of USB plugs in the shape of iPhones that she bought them anyway.
That’s the kind of expanded customer relationship that Greenberg says traditional distributors can benefit from and that online competitors could never have. “The key is to be there for them when they’re ready to buy and even when they don’t think that they need to buy,” he says. “Provide ideas and samples as often as possible. Those are the things that most online companies aren’t doing. It usually results in additional revenue opportunities.”
For his part, Chris Clark, managing director of Print It Promote It (asi/303927), says clients request more sophisticated services, such as digital integration in the form of QR codes on products and online stores, which accounts for 90% of the company’s business.
For clients interested in low-tech items, often the packaging is the source of their request, says Jeff Grippando, VP of promotional sales and marketing for City Paper Company (asi/162267). These days the mandate is “don’t just sell me a coffee mug,” Grippando says. Instead it’s “put that mug in a packaged box that I can sell as well.” He says packaging has had a noticeable presence throughout the industry, appearing with greater frequency as an item to consider at industry trade shows to help distributors expand their offerings and revenue.