The Stationers Guild

Posts Tagged ‘stationery industry’

Looking forward for the Stationery Industry

Sunday, April 28th, 2013

My birthday was April 27th.   I guess it is OK to celebrate the day, but I certainly don’t relish counting the years.  In any event, I have decided to look forward borrowing some inspiration from my favorite poet, Rainer Maria Rilke:  ”And now let us welcome the new year, full of things that have never been.”  The quote comes from a lovely Christmas card printed each year by Saturn Press.

Reflecting on the many changes that have occurred in the stationery industry, it suddenly struck me that one doesn’t go to Walmart, J. C. Penny or online for inspiration. One goes to an art gallery, a library, the theater, a church or synagogue or, maybe, a nearby park.  Perhaps, you seek inspiration from your spouse, your children, your family, close friends or colleagues.

Whatever source of inspiration that moves you is certainly better than dwelling in self-doubt.   As a dear friend and economist used to preface every economic prediction:  ”Often wrong, but never in doubt!”

While I may eventually be proved wrong (and I sincerely hope so!), I have no doubts on the direction of the stationery industry for bricks-and-mortar retailers.   Rather than waste my time and precious energy charging the windmills of stupidity and greed, I have decided to focus on the many talented designers and printers that inspire me and countless others that still make their mark on the industry.   Where possible, I will nurture and encourage them.

I do not know if this is the “right” path for others, but I certainly feel that I will be able to live a far healthier and fulfilling life by surrounding myself with beautiful papers and people of integrity.

As such, I plan to write far less frequently for the Stationers Guild and dedicate myself instead to Thérèse Saint Clair.

Au revoir.

Richard W. May
Founding Member Stationers Guild

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Think Local and the Big Things will fall in Place

Thursday, April 18th, 2013

Many people accuse me of looking only at the “dark side” of fine stationery industry.  Like most paranoids, I may often appear to be somewhat delusional, but I see no merit in engaging in the “happy talk” that currently surrounds our industry.  Let’s face it,  the stationery industry is in crisis and in desperate need of inspired leadership.  (Actually, I would settle for “competent” leadership.)

“Beauty may be in the eye of the beholder,” but comparing an engraved invitation on 100% cotton paper to the dreary outcome of a flat-printed web template design is like comparing “apples and oranges.”  Nevertheless, the “new demographics” gurus would like the consumer to do precisely that.   Personally, I think the consumer needs a “real” choice.

As I have stated previously, I have no idea what the future holds, but I do know that unless you have an active and targeted online presence you will fail.  This is as true for bricks-and-mortar dealers, our vendors and  home dealers as it is for online re-sellers.   The value proposition that a bricks-and-mortar dealer (and some home dealers) provides a prospective client is that you are seeing “the real deal”:  real paper, real colors and three-dimensional printing.  None of these distinguishing features are available on the internet.

The selling argument is quite simple:  Why should a smart consumer short-change themselves on quality by basing their purchasing decision on a low-quality facsimile and limited experienced service?  Julie Holcomb says it best when speaking to a consumer buying wedding invitations:

If you are like most people, you have never ordered any kind of custom printing prior to ordering your wedding invitations. You can benefit a great deal from the experience of your local stationer, who orders all kinds of custom printing, from many vendors, all the time. They’ll help you make sure you’re covering all the bases and making decisions you’ll be happy with for a long time.

If you are a local business, you can position yourself to attract that smart consumer in your neighborhood.  This is the consumer that wants to get it “right” by making an informed decision based on the price/quality trade-off.  In fact, Google makes it easy for you to be featured on the first page of Google if you make a minimum effort to CLAIM and PROMOTE your business.

Best of all, it is FREE (or mostly free if you decide not to engage some of the paid services).  Just think, Wedding Paper Divas is spending hundreds or perhaps thousands of dollars to be featured in your zip code and Google is giving your local business Prime Space on the first page of Google for FREE.

If you want to find out how search relevant your business is, simply enter the name of your company and zip code into http://getlisted.org.  If your business is not over 45%, you probably have some serious visibility problems in your market.  Personally, I don’t find the search results nearly as accurate as they were before GetListed.org was acquired by SEOMoz.    In any event, it is easy to start improving your ranking by claiming your businesses on these various local search engines.

Stationers would be silly if they failed to avail themselves of this FREE service.  This should be your number 1 priority!

Richard May
Discouraged but not despondent.

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Shutterfly buys Tiny Prints: What you should know

Tuesday, March 22nd, 2011

In a not too surprising development, it was announced yesterday that Shutterfly would acquire Tiny Prints for over $300 million in cash and stock.  The terms of the acquisition are somewhat complicated but not unusual in this type of acquisition in that institutional shareholders (read private equity firms) will not be allowed to sell their shares for 6 months and the managing partners of Tiny Prints who collectively own 12% will be locked in for 18 months.

What does this all mean?  Firstly, this is a great deal for the shareholders of Tiny Prints whose growth potential appears to have stalled as both Tiny Prints and Wedding Paper Divas are beginning to find it increasingly more difficult to differentiate themselves at the high end of the custom invitation and announcement market.  As long as the share price of Shutterfly doesn’t fall over the next 18 months, the Tiny Prints shareholders will be well compensated for their original investment.   I suspect that there will be a significant fall in the price of Shutterfly beginning in the fourth quarter as private equity firms jettison their shares.

Secondly, this is a very aggressive move by Shutterfly to diversify their sources of revenue and income.   Shutterfly operates at the low end of the market with an average sale of $32.88 in 2010 ($44.41 for the 4th quarter).    How will Tiny Prints’ strategy of paying over $50 in search marketing expenses to acquire a single sale resonate with Shutterfly’s Walmart and Target marketing focus?  Clearly, there are advantages to help smooth out the seasonality of  Shutterfly’s business with the addition of Tiny Prints’ baby and wedding business, but is it enough to offset the fact that over 50% of Shutterfly’s revenues occur in the fourth quarter.    Personally, I suspect that Tiny Print’s product offerings will diminish in quality and price (they were already moving in that direction) rather than lift the quality of Shuttefly’s overall product offering which is firmly entrenched at the lower end of the market.

Thirdly, what does this say for the wedding invitation and baby announcement business as a whole?  As readers of the Stationers Guild are aware, this is just another step in a consolidation process to protect margins at the lower end of the market.   It is a question of rationalizing cost structures to compete in the mass-market.   There is no end of competition in this market segment.  For instance, Paper Culture has immediately jumped into this marketing milieu by promoting its environmental qualifications when compared to Shutterfly and Tiny Prints.   How reassuring it is to know that Paper Culture is planting a tree for every order that they receive.  Does this make Paper Culture green?  The co-founder and CEO of  Paper Culture is Christopher Wu, whose background is in technology.  With  jobs at Yahoo, Microsoft and HP, Mr. Wu doesn’t strike me as one who is a spokesperson for either the stationery industry or the environment.    Are consumers just being played?  You be the judge.

If you are confused, you should be.  There is a lot going on in cyberspace as online marketing heavy-weights compete for visibility.   The hype has reached outrageous proportions and only reconfirms what Eric Schmidt, the former CEO of Google, said about the internet:  It is a “cesspool” of misinformation.  For those of us who value the craftsmanship that goes into making fine paper,design and custom printing, we are witnessing the digital footprint of the barbarians reducing a proud industry to recycled scrap paper.  Personally, I don’t think the consumer will be so easily conned and the only way these online behemoths will able to compete is on price.  This is a sure recipe for disaster.

Well done Tiny Prints.  You got out at the right time.  Hopefully Shutterfly won’t collapse until you have had an opportunity to sell your shares.

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21st Century Bride: A can’t miss event

Monday, March 21st, 2011

Brian Lawrence is one of the true experts on how to build a credible personalized stationery and custom invitation business.  With substantial experience in both camps, Brian understands the needs of bricks and mortar stationery stores as well as vendors who create and print cutting edge designs which shape our industry.

On Monday, March 28th, Brian and other leading experts will be hosting The 21st Century Bride, an event which is certain to change the way you approach your wedding business.   This event will be held in East Rutherford, NJ but will be broadcast around the world for those that can’t attend in person.  There is already considerable interest in this event, so book your reservation now and learn from the leading experts in the industry.    At $129 for the online presentation, this is a bargain that will pay for itself many times over.

As readers of the Stationers Guild are aware, Brian and I share many of the same concerns over the forces that are shaping our industry.    Brian has founded Local Traffic Builder which helps local merchants  optimize their business for online search.  With bridal couples increasingly using the internet for online search, many small stationery stores are missing the boat because they simply can’t be found by people who would like to shop locally.  Whether you have a website or not, I would strongly recommend contacting Local Traffic Builder to see what Brian and his colleagues can do to improve your search results.

Again, The 21st Century Bride is packed full of riveting speakers and other than the National Stationery Show, is an event you don’t want to miss.  Register now for The 21st Century Bride.

Richard W. May
Founding Member of the Stationers Guild

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Walmart on my Mind: Discounting or the Filofax Conundrum

Thursday, August 5th, 2010

Discounting has always been a source of conflict within the stationery industry.   Many see it as a normal competitive business practice, while others view it as irresponsible behavior that does not properly reflect the appropriate “value” of the product or service provided.   This is clearly a very difficult concept to get your hands around and, I suspect, that there is no clear consensus on how to enforce (assuming it is needed) ”fair and reasonable” pricing to protect a brand.    While “pricing competitiveness”  is an important component of discussion on discounting, the subject has ramifications that have a huge impact on business in general and far-reaching but less well understood social consequences.

Rather than discuss this in a conceptual framework, I think it is useful to highlight some of the radical changes that are occurring in the publishing industry.    As we all know, the newspaper industry is imploding on itself as print advertising revenue is displaced by online advertising and cable TV.  Warren Buffet remarked that with “news” content distributed free (or nearly free) over the Internet it is difficult to build a convincing business case for the survivability of the newspaper industry.  I tend to agree with him.

Similarly, with price wars heating up in the book publishing industry and the growing acceptance of downloading and reading books digitally it would appear that a similar revolution is taking place in the book publishing industry.  Barnes & Noble has put itself up for sale and I suspect that the days of “print publishing” are numbered.    Certainly, there is a compelling case to be able to access any book (whether in print or not) immediately online; however, some of us still prefer the touch and feel of paper to back-lit digital readers.

Regardless of how we feel about these changes, change is coming and it is being driven by a more efficient and less-costly distribution system.  In effect, while you may prefer to read a print version of the New York Times with your morning coffee and pop down to the library to check out a book, it seems likely that these everyday rituals will soon be displaced by something quite different.  Some of us may find the transition easy, but others less so.   For me, it is difficult to imagine the beautiful Barnes and Noble bookstore in Union Square (NYC) turned into a warehouse to sell third-world arts and crafts.  And what about the employees, the editors and publishers?  What will become of them in this brave new world?  Is Walmart hiring?

Now to a practical case.  Our store, like many stationery stores, carries Filofax.  Yes, not everybody has migrated to an iPhone or Blackberry.   For several years, I have been following the evolution of Filofax to determine how they intend to deal with the digital assault on their dated merchandise.  The first thing Filofax USA did was to setup a rather cheap Yahoo online store some years ago to sell their merchandise directly to the public.  The website is far better today, but in an effort to retain sales they began to sell their products to online discounters and now offer consumers special deals that their retail outlets can’t match.  In effect, Filofax is competing with their own retail outlets at terms and conditions not available to their retailers.  This creates an awkward situation for retailers who have been servicing an aging client base who still use the Filofax product.

My objective here is not to throw cold water on Filofax’s merchandising strategy, but to highlight how extraordinarily difficult it is for store-front dealers to retain a stiff upper lip as they are being systematically disintermediated by their suppliers.    I suspect that many retailers will soon decide that the level of customer maintenance to support the yearly agendas and refills doesn’t justify the time and money commitment.    It’s sad to tell your regular clients to shop online, but quite frankly it may be the best solution (at least over the short run) for the client, the retail store and for Filofax.

As boutique stores begin to shed lines and, perhaps, determine that it is no longer worth the effort to remain open, the entire commercial real estate landscape of towns will begin to change.  We are already witnessing this across large stretches of the United States.   The business centers of small towns will simply disappear, strip mall will be plowed under and vacancy rates are likely to sky rocket as the “fixed” infrastructure costs no longer justify selling products that are being systematically discounted by big box stores and online retailers.   Perhaps, these towns will evolve into something quite beautiful and unexpected, but I have my doubts. 

Richard W. May
Therese Saint Clair

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Will fine stationery go the same way as Australian wines?

Sunday, July 5th, 2009

Yesterday’s New York Times had a fascinating article tracing the tragic decline of the Australian wine industry.  Meriah Foley in an article entitled “For Australian Winemakers, More Turns Out to Be Less,” documents the decline in margins of the world’s fourth largest wine exporter whose aggressive pricing to build market share now threatens the entire industry.  Writes Ms. Foley, “Even as its star appeared to be rising, the Australian wine industry was sliding, selling a greater volume of wine at increasingly lower prices . . . a level many say is unsustainable.”  For one who discovered the bold new taste of Coonawarra wine in the late 70s, this comes as a bitter disappointment.

For some time, I have felt that the same thing has been occurring in the stationery industry.  We are constantly bombarded with new papers and designs that - like Australian wines –  British wine writer Andrew Jefford refers to as “cheap and cheerful.”   As more and more fine stationery companies fall prey to the need to mass-market their product over the Internet, brand awareness and quality standards will inevitably give way to price competitiveness. 

I have long argued that there is no way to differentiate your brand on the Internet and the only way to compete effectively is to become the low cost producer.  This implies sacrificing standards and quality.   Once you have done so, can you restore brand awareness to a public that has become accustomed to the “discounted” brand?  The Australian wine industry is a vivid example of what can happen to an industry that loses its bearings and places its emphasis on growing market share rather than promoting brand awareness.

It is not difficult to see the same tragedy unfolding in the stationery industry.   With self-appointed pundits shamelessly promoting inferior designs, cheap papers and anything-goes etiquette, it is no wonder that the public is confused and disoriented.    I fear that the stationery industry is rapidly paddling up the river of no return.   If we want to preserve the integrity of the industry, designers and craftspeople and industry leaders must collectively raise their voice to the innane claims, hyperbole and simply “bad taste” that permeates our industry.

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