Tom Friedman’s classic book, “The World Is Flat,” warned us about the flat planet and how exponential change was upon us. I have already written much about it in this column, but here it is again.
It was in the cards that one day you would call Walmart your competition. The day is here. We have all seen their launch and nobody knows how far they will dip into the marketplace. Their product offering may be shallow at this point, but it is certain to increase. It is not “way out” to think they will put embroidery machines in each store for both promotional and traditional apparel.
While I have no crystal ball, it is more than a rumor that Amazon will be making a big DIRECT splash right into the heart of our business. Amazon has disrupted every market and ours is too big to ignore. In my career, I have always had “what if” sessions while doing strategic planning. So, what if AMAZON decided to purchase one of our industries top 10 suppliers? These suppliers are all supermarkets of bestsellers. It is a frightening “what if” as this would be the European model, but instead of door to door it is computer to computer. Oh boy… should they enter, we will certainly see significant price cutting. Amazon sees our margins and knows they can make a killing despite exponentially lowering prices. This is the model they seem to be using with Whole Foods.
Alibaba, once our friend, is truly our competitor. Their ability to brand and ship small quantities of product can only grow. I see a lot more direct-to-consumer internet advertising.
I mentioned “what if” sessions in strategic planning. I need to modify it to “How can we?” The primary question is how can we, our mainstream industry (not the outliers who are in bulk product marketing and internet marketing) secure our share of the market in the future? That takes strategic thinking with a large group of partners.
ASI, PPAI, SAGE and any other companies who represent our industry to the buying public through their goods and services need to huddle up... yesterday. While these companies may not seem likely allies, the future of our industry is as critical to them as it is to you and me. Only this morning I saw a commercial for an association of human resources directors on CNN that was extolling the value of its members, as well as doing some recruiting. Expensive? Yes. Needed? Yes.
Strategic Planning For the Industry
How do we see our industry in three years? How can we grow the industry in face of increased competition? How can we secure the margins that have helped build this industry despite growing competition? We need a consortium of leaders from all camps to step up, unite for this cause and lead us all. I’m in favor of rebranding our industry and a whole lot more, but this is not about one person’s concepts, it is about intelligent strategy in a world of accelerated change. I want the world to learn about our value added on Bloomberg, CNN, CNBC, WSJ, etc. Where business learns, clicks and watches is where we need to be, but what our message is has yet to be determined. It can no longer be just products.
Funding
Sorry Republicans and even Democrats but it is tax time. Any campaign our industry may do cannot be funded with PPAI dues, ASI’s revenue, etc. It has to be funded by the stake holders... both suppliers and distributors.
In the franchise world, the franchise owners pay into a national ad fund. We need to follow this model and consider both the supplier and distributor side “franchises.” With this “kitty” or war chest, we can invest the money in the most appropriate media and establish a new paradigm as to just what clients think of us and what we do. We must move away from “stuff.” Stuff to us is like a pill to a physician; it is what a doctor prescribes, but not exactly what they do for a living. My doctor is to me as you are to your clients. You diagnosis problems, find the need and provide an educated solution. Voila – you are a doctor.
Imagine collecting proportionate “donations” from the smallest supplier and distributor to the largest. Anyone with a SAGE, UPIC, ASI or PPAI number should pay a fair amount. There are no less than 35,000 companies whose business are dependent on our industry. If everyone gave just $25 to the fund (35,000 x $25 = $875,000). Actually, it would be at least triple that if the larger companies paid a bigger sum on a progressive funding scale.
We cannot, we should not, sit on our hands. I think the only way to get this done is to create a not-for-profit or nonprofit business enterprise, “The Branding & Marketing Consultancy Group,” and bring it all together with one mission: promote buying from us all.
Strategic Planning for You
I am nervous about my business and yours. Neither of us can sit on our hands. I can pull up 500 distributor websites at random and they all welcome me to a world of “stuff.” So, you need to ask yourself, “How can I delineate myself and my company from the likes of Walmart, Target, Amazon, etc.?” You may be fine now, but when a school parent walks into Walmart and sees that they can get imprinted T-shirts – freight free and in 24 hours, you lose. Oh, so you don’t sell schools. Once any of your customers browses innocently for a promotional product, the next time they open their browser, Facebook, etc., they will be bombarded by these new players, the Big Stuff Outlets. Sooner or later you will face erosion.
What can you do? Plenty.
Start with a self-determined strategic planning committee. Bring in outside people who will look at you and your business in a fresh way. Get a financial person, an IT person, a customer, a young, upwardly thinking supplier (there are many) and certainly any creative internal people you have. Hey, maybe even the director of your regional association. Please leave out anyone who has ever said to you “in my day.” There is very little relationship between those days and the present.
Get out of your office. Hide the phones and begin your strategic planning. Treat this committee as the most important VIPs in your business. Dole out food drink and appreciation. The hard part is facilitating this. The head honcho should not be the facilitator for scores of obvious reasons. Have a recording or have copious notes taken. You will need them. After your meeting, you are not done, but well on your way. You may need more data, perhaps proof of concept or a survey. Get it done before you draft your written plan and run it by your committee, before you make it your GPS for future travel.
In an earlier column I told you how my world changed forever the day Steve Jobs introduced the iPhone. I did not expect it nor did I have many, if any, warning signs. I hope you can see the handwriting on the wall. Even if you don’t execute your strategic plan, the work you do on it will have many positive effects for you and your company.
Joel D. Schaffer, MAS is CEO and Founder of Soundline, LLC, the pioneering supplier to the promotional products industry of audio products. Joel has 48 years of promotional product industry experience and proudly heralds "I was a distributor." He has been on the advisory panel of the business and marketing department of St. John’s University in New York and is frequent speaker at Rutgers Graduate School of Business. He is an industry Advocate and has appeared before the American Bankers Association, American Marketing Association, National Premium Sales Executives, American Booksellers Association and several other major groups. He has been a management consultant to organizations such as The College Board and helped many suppliers enter this industry. He is a frequent contributor to PPB and Counselor magazines. He has facilitated over 200 classes sharing his industry knowledge nationwide. He is known for his cutting humor and enthusiasm in presenting provocative and motivating programs. He is the only person to have received both the Marvin Spike Industry Lifetime Achievement Award (2002) and PPAI’s Distinguished Service Award (2011). He is a past director of PPAI and has chaired several PPAI committees and task forces. He is a past Chair of the SAAGNY Foundation, Past President of SAAGNY and a SAAGNY Hall of Fame member. He was cited by ASI as one of the 50 most influential people in the industry.