For months now it has been the same old story. You hear it everyday on the news, in the paper and on the web. The financial markets are in the tank (along with my 401K), credit is tight and the entire economy is basking in uncertainty. No matter the hemisphere or market place, it can be just depressing. And then more bad news: postal rates are scheduled to rise an average of 4 percent in May 2009.
Someone said to me a few weeks ago that 2009 would be the opposite of 2008 and there is (hopefully) some wisdom in that message. In 2008 we had three quarters of decent news and then in the last quarter went directly downhill. 2009 looks to continue to be negative for the first three quarters but many of the economic wizards say we could see the start of an upturn in the final quarter. But until then we have to face reality of a significant economic recession. So what do we do? That’s the discussion for today.
Over the past few weeks I’ve been traveling and talking with many customers. As you might expect, while no one is ready to give up there is not a lot of cheer and optimism out there. We are all thinking about the best ways to move forward. Let me share some of what I’ve found.
First, some companies have protected themselves by making sure that they have the print business before adding equipment, which is a good operating policy even in the best of times. They are also taking extra time to better understand customer needs so they can better manage today’s situation while at the same time preparing them for when the economy improves.
Next, the strategy I have mentioned before and want to point out again is that convergence is the lifeline to being prepared for a better economy ahead. The wider the range of jobs and types of applications you are able to run using a relatively narrow range of equipment and software, the better the return on your technology investment and the better you are positioned to survive and even thrive in tough times. For instance, if you make your living printing and mailing bills and statements, adding informative or promotional content to the statement is a natural form of convergence that adds immediate and measurable value to the services you provide. In fact, on March 10 the Money section of USA Today noted that coupons are paying off in this economically stressful time and some marketers are willing to pay to produce coupons that they know are going to reach customers and prospects. Long live onserts and inserts!
And don’t forget, convergence isn’t just about the print engine. Some print providers who have printed transactional documents for years have not merely added some type of transpromo messaging, but are handling an increasing share of their customers’ data processing. This not only makes them a bigger asset to their customer, but deepens relationships beyond print and mail so it’s harder for a customer to leave.
My travels have also taken me to several book manufacturers and while they all say business is down, they still have core segments that are moving ahead, such as religious and legal titles. It’s easy to be skeptical and say these are niche markets, but in a country of 313 million people niche markets can be very lucrative. Anyone who devotes some of their press time to books should be looking for narrow markets where they can fill a need.
Every week or so it seems like another newspaper is closing down, going to an all electronic format or changing from a daily to weekly print publication. Yet while some times are bad for one market, they can be good for another. We are receiving multiple requests to print newspapers digitally and are doing so in different countries worldwide, with more to come. Niches can play a part here, too. Take a any large city with a segment of its population from, say, Romania. Could a printer with the appropriate technology produce the daily paper from Bucharest for local distribution? Chances are the answer is yes, and it’s new business that fills a market need.
I’m sure we all think that its best to hold on to our money reserves (if we have any) or not go any further into debt, but this is also a good time to look for lower lease costs on a new building or to invest in new software to support the ever-changing world of PDLs. There is no magic bullet and none of us have all the answers, but as I travel I’m seeing some rays of sunshine out there, so don’t let it get you down. Look for jobs that are outside of your traditional business and hire some of the talent that could help you look into and prepare for the future.