As consumers become more demanding, OP vendors are having to get clever. In fact, Tom Stockwell, editor of the Stockwell Report, believes it has never been tougher for OP resellers, which these days must be able to attract and dazzle their customers through a multitude of different media.
"Customers expect to be able to evaluate or possibly buy a product both online and in-store; they want low-price and high customer service; and they want to be able to return products," he said. "Consumers are requesting more and more."
This trend is just one of a variety of wider trends that are impacting OP companies today, from the manufacturer down to the independent dealer and retailer. And OfficeMax, said Stockwell, is one company that is getting it right. "OfficeMax used to be just a retailer, but it is now in contract sales and online sales. In fact, in online sales it appears in the top 20 companies along with the likes of Amazon. Companies can’t just rely on retail anymore."
This is one of the messages to OP companies in Stockwell Associates’ most recent quarterly Stockwell Report. Another, in the trend towards online, is the need for printing companies to look at the new opportunities presented through online printing. "Printing businesses need to be strong in online and digital printing services and competent in value-added services," said Stockwell. "There is not much business in offline printing services anymore.
"When you talk about the importance of service orientation and digital printing, it is the personalised services online for printing that stand out as the marquee of the new era for printing services," adds the report, which suggests that this is one of the major reasons why Kinko’s joined forces with FedEx – to increase speed of delivery and enhance profits with more traditional add-on business supplies.
On the ink side, introducing ink filling in store – Ã la OfficeMax and a number of US supermarkets and drugstores – will be a definite trend, predicts Stockwell, because they are profitable items to sell. But he warned of the implications of this on other players. "If very successful, ink stations will definitely hurt the aftermarket. The OEMs which have the international property, meanwhile, will have more ways to get over that."
The report also tackles external social factors in the US that are impacting the OP sector. For example, the middle class is losing ground to both the lower-income and higher-income segment; baby boomers are starting to retire, which will result in a significant decrease in spending (baby boomers currently represent 50 per cent of spending in the US); and the bigger number of women in higher education, which could also have a dramatic increase on spending.
Following on the theme of customer service, the report also analyses the value of customer loyalty programmes. "Its all about loyalty now," said Stockwell, "and everyone needs to think about customer loyalty cards. Independent dealers could even benefit from the customer loyalty programmes." But there are proven dangers, he warns, mainly from companies getting into it too quickly and not involving the company as a whole. "Everyone in the team must be into customer loyalty," said Stockwell. "It needs to be part of the company culture."
In addition, the report deals with innovation, and the need for manufacturers to innovate to stay ahead of private label; and the exciting rise of the scrapbooking market.
For more information or to order a copy of the report, contact Tom Stockwell on +1 207 647 5002 or at
tomstockwell@adelphia.net
