Print Solutions July 2006
FEATURE ARTICLE
RETAIL MARKET
Finding Retail’s New Specialties
BY REBECCA TRELA
Chip Grayson, president of Savannah, Ga.-based. distributorship SBF Inc., has
some clients who never ask him for anything.
In Brief
The retail market shifts and expands its focus to branded specialties and labels, eschewing traditional print. |
While customers without exacting demands might sound like a dream come true, to
Grayson, it’s one of the most difficult things about selling to the retail market. “It’s really on us to think up new items and then ask them,” he says. “Retail accounts are tough cookies. If it’s not perfect they won’t hesitate to tell you, in a pretty rough manner, how much they don’t like the job.”
Fast thinking, he says, keeps retail accounts bringing him business. One time,
Grayson remembers, a client gave him two teddy bears to take home to his young
daughters. The customer had gotten the stuffed animals as samples from another
firm for an upcoming Valentine’s/Mother’s Day promotion. “Right away, I asked him, ‘Do you know we do that?” Grayson laughs. “I didn’t know we did it either! But they wanted a million of them, so of course we were
in that business.” SBF landed the account and made an “exorbitant” amount of money, he says.
As Grayson suggests, savvy distributors are finding newer and more creative ways
of selling to retail accounts as old-line forms and documents are edged out by
electronic services. There is a growing demand, many say, for specialty items,
online marketing and products that integrate with new technology.
Dive Into New Products
The retail market is very sensitive to economic shifts, and has fluctuated up
and down in recent years, says Mark Trumper, CEO of Maverick Label in Edmonds,
Wash. Many stores have lost business as oil prices force customers to budget
tightly, in turn causing store owners to pare budgets.
“A large percentage of the retail market has invested in higher-end products and
more direct mail,” as a way to nab a piece of the ever-shrinking customer pie, Trumper says.
Tim McNab, a sales rep at Lakeland, Fla.-based Computer Merchandise Corporation,
once sold a 10’ tall inflatable olive to an olive packaging company. His coworker, Daniel
Lucas, has found electronic measuring tape, and Bob Rose, of Media Link
Communications in New York City, has printed comic books for frozen dinners and
tattoos for coloring books.
“Years ago I looked on the horizon and didn’t see forms,” says Grayson, who has expanded into other items to drive end users to customers’ doors. Recently, SBF helped design a treasure chest to entice customers to a
jewelry store.
“I sit on the board for a furniture store,” Trumper says. “They used to have a bunch of colored brochures in a big rack on the wall to give
to customers. Now that’s all electronic.” If a customer is interested in a chair, the salesman will walk to a computer
kiosk, print a colored PDF document about the chair, and hand it over.
“You have to get more involved in the printed store furnishings,” he says, referring to the items a store uses to market itself – store signage, jewelry boxes or plastic size tags. “I’m talking about more than ad specialties,” he says. “These are private label naming pieces – the brass plate that goes on a private label purse, for example. That’s what you need to dig deeper into.”
Aging But Not Obsolete
Assuredly, retailers still need price tags, labels, receipt rolls, brochures and
management services for those products. But traditional print doesn’t yield traditional returns. Today, a lot of distributors are talking about
labels.
As online ordering expands in popularity, retailers need more pressure-sensitive
and integrated labels to mail customers products that were once picked up in
stores. JupiterResearch, an internet trends research firm, estimates that
online retail sales, already nearly $70 billion a year, will grow at a compound
annual rate of 17 percent through 2008.
“Some of those packages may have two or three labels on them, which is great for
the industry,” says Vaughn Gordon, VP of national sales at Continental Datalabel. Most of
those are bar-coded direct thermal pressure sensitive 4- x 6-inch or 4- x
3-inch labels. Although the shipping labels market expanded with the birth of
the Home Shopping Network and catalog ordering, Amazon.com and eBay have fueled
exponential growth. In a presentation at DMIA’s Baltimore TRADEMart in June, Gordon explained that pressure sensitive labels
have grown at 2.5 to 3 times the national GDP since the
‘70s.
Labels are also growing in the shelf marking and prescription drug areas. Shelf
labels, attached to grocery and drug store displays, indicate unit price, bar
code and give customers comparison shopping data such as number of ounces in
each package. As the retail market continues to boom, Gordon says, so will
related print products, such as the increasingly popular
“shelf talkers.” He refers to Walgreens, one of the nation’s largest drugstore chains, which opened more than 1,000 stores in the last two
years, according to company reports.
Labels are also growing because retailers are shunning paperwork in favor of
scannable labels to track and store information, says Lucas, administrative
manager at Computer Merchandise Corporation.
“We are losing the custom forms business, but that’s offset because we pick up the labels end of it.”
“The pharmacy label is growing the fastest,” says Gordon. “A lot more people get prescriptions nowadays, and drug stores are opening
everywhere. If you’re sick at two in the morning, you don’t want to drive very far to get your medicine, and it seems like Walgreens is
opening a store every half mile because of that. What’s driving that trend is the prescription market – it’s getting bigger.” Prescription labels may also be part of a sheet-fed integrated form, joining an
invoice and cautionary drug information.
Another hot trend in the retail market has been radio frequency identification
tags (RFID), which use silicon chips and a metal antenna to relay product
information without line-of-sight readers, like bar coded labels. (For more
information about RFID, see related story, pg. 85)
“Conceptually, it’s a great idea,” says Trumper, who remains skeptical of its current revenue potential. “It has the potential to become the next greatest thing, but it’s going to be difficult to drive the price barrier down until there’s a standard.” He estimates that it will be four or five years before RFID tags can be feasibly attached to every item, instead of an entire pallet, as manufacturers battle for market control with proprietary technology.
Think Like a Customer
Another essential component to the retail market, distributors say, is the
service you provide. This is one of the ways Rose, principal of Media Link,
stays afloat.
“This was always a relationship business,” he says. “My boss used to scream at me to always ‘Think like a customer, not a printer.’ Putting yourself in their shoes has nothing to do with printing, it has to do
with common sense and listening.”
One of Rose’s manufacturers once shipped hundreds of cartons of an order without labels. “They think they’re in the printing business, but they’re in the communications business. They’re in the ‘getting the right label on the box and getting it to the right place’ business. Perception is reality here.”
A lot of retail business, says Tim McNab, is won and lost through service.
“Retail is much more volatile than it ever used to be,” Trumper says. “You need to be closer to your customer now than ever.” He suggests managing a customer list, offering targeted brochures, and thinking
about how to make the customer money first.
But once you’ve landed a retail account, he continues, the customer will bring you returns. “Retail’s a good business to be in because it’s transactional, and there’s a high volume by nature.”
Examples of recently printed specialties for the retail market, sold by Bob Rose
at N.Y.C.-based Media Link Communications. Included are samples of a comic book
printed with FDA-approved inks for frozen dinners.
Rebecca Trela is an assistant editor at Print Solutions magazine. Email her your comments at rtrela@PSDA.org.
