I visited Vistaprint's first retail location in downtown Toronto the other day. I went with an open mind and to see what makes them appealing as a promotional products distributor.
Here's what I encountered
Vistaprint's retail store is called Vistaprint Studio and they've positioned this as a "design studio" where anyone can come in and source their own print, signage and promotional product needs. It's setup like a big showroom with tables in the middle and products around the perimeter. One side of the store features a bank of computers where you can jump online, design your products and order products from their site.
It's reminiscent of an Apple Store with their clean and simple layout. The products are colour coordinated and show how merchandise can be tied together to create an overall brand look.
The products veered towards the traditional (Fruit of the Loom Tshirts, Jerzees polos, regular baseball caps and tote bags). While traditional, I wouldn't say any of it was tired or outdated. They were what you'd expect most companies to order in a traditional promotional campaign.
When I entered the store, I was immediately greeted by a cheery staff member. She was young and very enthusiastic and was working off a script as I heard her repeat the same greeting to others in the store. That said, she was very professional and made me feel welcome.
She asked me if she could help. To which I said that I was looking for some unique promotional products for my software company (all true). She directed me towards an area of the store with some examples of popular promotional items they have done (aforementioned caps, Ts, polos and bags). I asked her how their process worked and she said that they have some limited examples in the store but that I could tour their whole product catalog online (directing me to the large screen monitors all throughout the store.
I dug a bit deeper and asked if she would be able to put together some ideas for me. She politely responded that I could find ideas and more information online and if I wanted any design help, that could be facilitated online as well through their design team based in India.
She then thanked me and moved on to another customer who had just walked in. The exchange was about 3 minutes and it was clear that she was trying to direct me to their site where I could finish the process. I didn't feel abandoned, but I didn't feel like she was able to help me with any ideation or promotional strategy either. She was not asking me why I was looking for promotional products, anything about my business or any specific marketing challenges I was facing.
To be fair, I wasn't really expecting this, just like I wouldn't expect the clerk at the big box supermarket to design my Thanksgiving dinner menu for 30 guests.
I browsed through the selection on the wall and then went over to one of the terminals where I created an account and poked around their site.
Online, I saw a huge selection of the most popular promotional items you would see at any of the bigger suppliers in our space. The site was very well designed and easy to navigate. The "add logo" step was very intuitive (noting standard imprint locations only) and they make it pretty easy to request design assistance (costing $5 with a 24 hr turnaround from their team in India).
If I was a small business owner or an individual looking for standard promotional products, I'd say the experience was a positive one. I didn't feel abandoned by their staff, but it was clear that the web site was the real star of the show at the store. Know what you want? Want to order online without a lot of human interaction? Need some basic ideas in the key promotional categories? Then Vistaprint can help.
Observations and takeaways
The bad news (for established industry distributors)
- Vistaprint's "office" is a lot nicer than that of most companies in our industry (admit it, when is the last time you organized your showroom or got rid of those samples you last hoarded from the latest trade show)?
- Vistaprint is situated in the heart of the funky business district in Toronto. They'll surely pickup traffic on the street and there are a lot of corporate marketers who work right there. I suspect they will setup additional retail locations in other downtown neighbourhoods in other cities.
- For customers who prefer the DIY approach, Vistaprint makes it pretty easy to manage your signage, print and promotional needs.
- Vistaprint's Trojan horse strategy is to court customers with print needs and then extend the relationship into all sorts of products that can be imprinted (like promotional products). I am sure this makes economic sense as print has very low margins whereas promotional products have stronger margins.
- Understand your customer. Vistaprint (for now) is focused on making the ordering of traditional promotional products easy for small businesses and individuals. As I said before, if I was a small business owner looking for standard promotional items, Vistaprint makes it pretty easy.
- Understand your unique value proposition (design strength, product expertise, expert advice). If your "value proposition" is to sell traditional promotional products through a catalog or a white label industry web site, then Vistaprint will be stiff competition as they do this, but much better.
Now, if your value proposition extends into other areas (highly personalized service, exceptional design help, unique merchandising skills, deep knowledge of your customer's business and industry, etc) then you will beat Vistaprint. Guaranteed. This isn't an attack on Vistaprint as much as it's a statement on what they excel at. Like any smart business, you are better to double down on what you best.
- Vistaprint is taking direct aim at office supply retailers like Staples and ecommerce players like 4imprint with this new retail/web model. I see them being stiff competition for both of these players. 4imprint has no retail presence (though I am sure they have a showroom in their head office but that's not true retail). And Staples has a very weak promotional offering at their store level. They tried that in their Golftown retail locations before and I don't think it was terribly successful.
If I were a big program distributor and was starting to feel the heat from Vistaprint, I would double down on my company store business, and moving up the customer’s food chain. Vistaprint will likely chase down that business in time, but for now they are focused on that small/Main Street business customer that's getting lost amidst the big company store distributors and the inefficient distributor that's relying on the transactional sale. In short, this is a customer segment that's starting to look online for an alternative promotional products experience.
But back to Vistaprint.
I think it's exciting to see new investments being made in the promotional products industry. It encourages everyone to step up their game. I do see them being a threat to complacent, transaction oriented distributors, but I see them being net positive for the industry as they'll increase the pie (ie. they'll sell to some businesses that have never bought promotional products before) and they'll raise the profile of the medium.
And for distributors that have an exceptional value proposition, you'll continue to look great alongside Vistaprint as it's like comparing an apple to an orange.
About the author:
Mark Graham is the Chairman Emeritus of PromoKitchen and co-founder of commonsku. He lives in Toronto and pedaled down to Vistaprint on his bike for this fact finding mission.