Perhaps the reason why procurement continues to capture my imagination and passion after so many years analyzing the sector is how many categories there are to learn about. In the decade or so that I've spent in the Spend Management world, it seems that every week I manage to come across something new about a category that I previously had little experience with. Print marketing services -- and print in general -- just happens to be one of these areas. Last week, I had the chance to listen into a Supply and Demand Chain Executive webinar on the subject. Ariba's Steve Sussman led the discussion, sharing his thoughts on why companies should prioritize print marketing services in their portfolio of category sourcing strategies. According to Steve, print touches all aspects of a marketing organization's programs, from brochures, mailers and displays to forms, promotion kits and call center books and scripts. In most cases, a Chief Marketing Officer (CMO) owns the print marketing services category, rather than procurement. But there are many reasons for procurement to get involved, not the least of which is creating near-term savings opportunities.
After the webinar, I had the chance to trade emails with Steve, asking a number of questions that I thought Spend Matters readers might be interested in. I'll reprint these here for those who are curious.
Spend Matters: At what stage in their Spend Management lifecycle do companies tend to target marketing print?
Steve Sussman: Companies address this at any stage in the lifecycle. Most recently, more G2000 organizations are addressing print in concert with digital asset management and brand integrity programs. Marketing print, has been left for last, simply due to political silos and the complexity of it spend criteria. Now that low hanging fruits have disappeared, and other complex services have been addressed, such as temporary labor, Marketing is on the radar screen in a prominent position for cost reduction. More, most companies have learned by now that attacking this category only from the collaboration perspective is not as effective, nor measurable, as once thought.
Spend Matters: How are import tariffs impacting the print market?
Steve Sussman: Coated free sheet paper continues to be imported from Korea, China, and Indonesia with no anti-dumping or countervailing duties. The Chinese tariff was recently repealed. This means that US printing concerns will remain competitive with Mexican and Canadian printing organizations.
Spend Matters: What are some lessons learned from global aggregation and demand management?
Steve Sussman: I'll answer this in three parts: A) Printers are scaling up their ability to handle multiple languages and cultural aspects of print. Now many mid-sized forms are addressing this segment, so global sourcing can now look at smaller mid-sized organizations. B) Aggregation and demand management for marketing materials focuses on paper, application of P2P players, and those larger firms that can address production and delivery to the field. An example is the delivery of custom imprinted field materials for the field. This can be aggregated into a self-serve delivery model on a global scale equipped with all required cultural, operational and language challenges successfully addressed. C) Implementing Ariba's Holistic Print management approach enables a granular look at some very important operational attributes which play a major impact on demand management and vendor rationalization, globally. This approach more closely matches the needs of a global organization and is superior to implementing a simple paper program and a point technology solution due to close attention to cost elements that have a major impact on the print value chain.
Spend Matters: What industries are the most sophisticated in their approach to this category?
Steve Sussman: The most sophisticated organizations are CPG companies and some Financial Services firms. CPG contains the largest and most diverse Marketing spend, followed by Financial Services. However, FS tends to focus more on direct mail which is highly predictable.
Spend Matters: Take out your crystal ball for a moment -- what are your predictions for marketing print in 2008 and 2009?
Steve Sussman: In 2008, we'll see: A) Huge impact on variable print consumption. B) Loss of out-of-home market due to digitization. C) More industry consolidation to due margin pressures. In 2009, I predict: A) Larger impact on variable print due to lower costs and need to increase market share. B) More offshore paper subsidized by foreign governments means lower paper costs. C) More use of wide-format print. D) Improved field marketing delivery with customization. E) Green printing impact. F) More options for brand protection.
- Jason Busch