This is a question LPC asks constantly. Every year, in the work we do for TLMI (Tag and Label Manufacturers Institute), FINAT (The European Trade Association for Self-Adhesive Labeling and Adjacent Industries) and customer surveys for our private clients, we probe the issue of what brand owners and packaging buyers want from their label vendors. Our firm surveys hundreds of packaging buyers across North America and Europe every quarter and we often close surveys and interviews by asking participants some key questions: What can your label vendors be doing better? What could they do that they are not already doing?
Inevitably, the majority of responses fall into one of four categories and those include: Innovation, Proactivity, Technical Support and Education. What we usually hear from label sourcing personnel and packaging engineers are comments along these lines (and these are actual comments we have received within the past year):
- Be more proactive in making recommendations that will let me streamline printing methods and/or artwork design.
- Be more proactive in driving innovation that drives out costs. Educate us about what is available, and what is coming down the pipeline.
- Help us find innovative solutions that enable us to differentiate from our competitors on the retail shelf.
- And here’s an interesting one: “As a group, label manufacturers tend to be the least active packaging group that speaks directly to and understands the requirements of retailers. If a company excelled at this, we would switch to purchasing labels from them in a heartbeat.”
So what’s a label converter to do? We’ve compiled a list of the top four criteria that we think would make a label converter really stand out to their customers and prospects:
- Know your customers’ products. Backwards. (Even if you don’t print the labels that go on all of them.) This goes for your prospects, too. Do you know your customers’ product marketshare in each category they serve? Is their pasta sauce brand losing marketshare? If so, why? Did they recently near-shore some of their consumable durables products? (That is, did they divert manufacturing from China for an appliance line, back to the U.S.?) Did you know that one of their condiment lines went from PS-labeled glass containers to a flexible packaging printed pouch and it was a total market flop? Do you know why? What are they going to do about it? Become intimately familiar with the trends and market influences that impact the decisions your customers and prospects are making about their products. And once you know, distribute that information to every person in your company.
- Figure out what makes Millennials tick. By Millennials, we mean people who were born between the years 1981-1996. I know, I know, this subject is beaten to death in the media and many of us are tired of reading about what economists are referring to as The Entitled Generation. However, one-third of the workforce is now made up of Millennials and we all happen to work in an industry where one of the job functions with highest turnover rates is the sourcing of packaging: the folks who buy labels, flexible packaging, folding cartons and corrugated. Right now, Millennials are having a direct impact on your company. Members of this generation are either directly involved in the sourcing of your products, or, they have an influence over the vendor channels their companies select. Figure out what makes this generation tick. They communicate on the fly and don’t bother with long memos and emails. They’re texting, chatting and on social media channels 24/7 and you better figure out how to position your products (and your skills and your people) in front of them.
- Don’t be afraid to show off. Have you recently made a new technology investment? Make sure all your customers know. Do you have a resident technical expert who can dig really deep into the differences and benefits of printing one job conventionally and another job digitally? Ask this person to create a brief or FAQ directed at your customers educating them on the difference between conventional and digital and why your company is outstanding at steering customers toward the best fit for their applications. You can never convey your company’s technical expertise too much.
- Become environmental stewards and make sure your sustainability achievements make it into your marketing collateral. Here come those pesky Millennials again. This is the generation that cares the most about the environment and they are demanding that their vendors do also. Are you environmentally certified? Do you have an internal green team? If you do, skywrite it. Make sure that your customers and prospects know that your company is a bona fide environmental steward and takes best sustainability practices very seriously.
Vendor loyalty within the narrow web North American and European label printing industry is decreasing. We gauge vendor loyalty rates every year and it’s clear to us that brand owners and packaging buyers are becoming less loyal. This hasn’t always been the case in our industry. Profits for label converters were driven in the 1980s and 1990s by customers who stayed with their label suppliers, even if they knew they weren’t necessarily the best fit for some of their products. Vendor tenure meant something, but the game is changing.
How good is your company at playing it?
Questions? Drop me a line.
Jennifer Dochstader