“Lessons Learned” is a series where we ask ecommerce business executives to share their experiences and advice. For this installment, we interviewed Boyd Badten, director of technical service for PrintingForLess.com, a pioneering, online printing company located in Livingston, Mont.
PrintingForLess.com was launched in March 1999 with the idea of streamlining and expanding options in online printing. Today the company has annual gross revenue around $20 million.
The business runs on custom, proprietary software developed by Badten and his co-workers. It was one of the earliest ecommerce platforms that could convert both Macintosh and PC files to printable formats. Today, the system also handles much of the back-end, from credit card payments to customer relationship management. “We call it DB for database,” said Badten.
Badten offers the benefit of his experience in ecommerce below.
Shopping Cart Software, Web Hosting
“The system we developed runs on an SQL server and we’ve got our own server room. We have five programmers on our staff that do nothing but continue to build this system. It does our sales function, our manufacturing production process, manages shipping–everything–it’s all tied together. Even if somebody walks in the door to order a printing job, I would get into the DB interface to put in the order; so, we’re pretty much 100 percent ecommerce.
“Everybody in our whole company runs off of web interfaces to that database (except for the custodian and HR), so everybody knows in real time how we’re doing each day and what they need to do. So, you can see that a ‘shopping cart’ is like the other end of the spectrum.
“I would say if you’re selling anything that’s a custom product, and not just picking something off a shelf and shipping it to a customer, you have to consider the user interface. I don’t think you’re going to do [custom jobs] by using off-the-shelf stuff for very long.”
Credit Card Payments
“We accept all credit cards, and we have to comply with a much higher level of security than the average merchant because we own all of our own servers. Everything is encrypted at every level of transferring credit card data, and we manage all of it ourselves.”
“It’s all built into our system. It’s monolithic, with about 100 status levels of what a print order can be at. A customer can check to see what the status is and everybody here can, too. Everything is color-coded so that nothing stays too long at any kind of stage waiting for something to happen. We’re very centered around Lean Six Sigma [a business management strategy] that doesn’t like things to just get lost.”
“We’re a 130- to 140-person company, and most everybody works here in Livingston. We also own a website called Creativepro.com that is a content site for creative professionals who are mostly in graphic design, and some of the employees live in California and Portland and Seattle. But, for the actual print production part, we don’t really go for remote work. I think it’s somewhat antithetical to the printing culture.
“We have a very rigorous hiring process that attempts to hire people who already resonate with the values we hold. We challenge our employees and we give them a lot of autonomy, especially working with customers. Our managers don’t micromanage people. We have team structures here. Everybody’s in some kind of a three-person team, and each one of them runs a little bit like a little business of its own. They have their own stats and so forth, and so it creates cohesiveness and makes work kind of a game. The three-person team idea is very effective as far as productivity, but people like it socially also.”
Search Engine Optimization
“We have seven people here in our marketing and programming departments who are all very involved in SEO. Some of them are working on the code of the web, but a lot of them are working with creating additional content.
“We put real content on our site, which people find valuable. Also, we create quality back-links because many of the best search engines depend on how many references and links to your site are on other people’s sites. For instance, by doing this interview with Practical eCommerce, I’m actually doing SEO right now. If you want to get into the retail online business and you’re not very interested in SEO, I’d say, ‘Good luck.'”
“We have something of a Twitter initiative and we try to be very genuine about it, not ham-handed. We have over 500 followers and we get many tweets a week. We have a number of employees who are looking at our customers’ stuff and when we find really cool designs or funny kind of word plays or image plays, we put up a tweet and make it kind of funny–not making fun of the customer obviously, and we always ask the customer first. So, our followers are looking at these funny things, and in the process we gain attention, which is the whole point.
“Also, there are dozens of YouTube videos that our customers have made where they said, ‘Hey, PrintingForLess.com rocks,’ and we didn’t pay them to do it. They are customers that truly do love us.”
“We have about 140,000 unique visitors per month, and I would say only 10 to 15 percent of [those visitors come from] pay-per-click. Our PPC campaigns are mostly on Google. Most of the rest of them don’t really pan out. We used MSN a little bit for a while recently, but we’ve got a customer acquisition cost target and if the pay-per-click can’t actually deliver that, we can’t do it. We’ve been doing it for a long time and we have people whose job is to manage advertising.
“We’re very, very careful about the AdWords we use, and we spend tens of thousands of dollars a month. There are a lot of commercial printers competing for keywords and it’s costing us about $400 in pay-per-click [cost] to get an additional customer. If you retain your customers well enough, and your average order size is enough, you can recapture it within one to two orders and then after that it’s fine. But what happened was AdWords just kept spiraling up because [of the competition], and our acquisition cost got up to like $500 or $600. So, we just basically dropped a lot of AdWords that weren’t doing it, anyway. I would say pay-per-click is in something of a death spiral right now, at least for some market segments.”
“Our primary shipper is FedEx, but we use UPS and USPS, too. We used UPS exclusively for quite a few years, and we were their biggest shipper in the state of Montana. So we asked FedEx to bid on it, and they won. All of our software is plumbed right into their systems, so it’s easy to do it either way, but we ship with FedEx unless a customer specifically requests another shipper.”
“Unisource and xpedx are our two main sources of paper. They’re the big dogs and they do a good job. Unisource gets most of it because they agreed to maintain a whole portion of our warehouse with just the amount we want and we don’t have to ask for it. We try to have very little inventory because that’s not really a good idea. If we do have to order something that’s not a standard paper stock, we still get it within two or three days.”
“You have to have somebody on your staff who owns the relationship with every vendor, and you have to have some kind of a goal for what things cost you, including your waste. You’ve got to measure everything, whether it’s marketing, buying, paid search results, or managing vendors.
“Obviously, you can only beat up a vendor so far, but if you don’t watch them, they find ways to make a little more money off you, and if nobody’s paying attention, then shame on you. For instance, credit card merchants are notorious for inching up their rates, and if you don’t have somebody who’s accountable for it and responsible for reporting it at least quarterly, then you’re getting less than cost accounting accountability. Own every one of these relationships, measure everything, and attempt to continuously improve.”
“A lot of our system uses QuickBooks, but we’re big enough that a certain amount of our system exists elsewhere from QuickBooks. We have a three- or four-person accounting department and annually audited financials.”
“After every order we ship, we [make a follow-up call]. And if the customer is not happy with it, by golly, we make it right.
“So, we are actually out there looking for what in manufacturing you’d call a waste or failures, which a lot of people think is crazy. But think of how that looks in the eyes of the customer. Our whole thing is to get customers that truly love working with us, trust us and give us as much of their business as possible. Repeat business is really what it’s all about, and so we follow up. Also, we have 100 percent satisfaction guarantee, which I would say most printers don’t have.”
“For many years our company had held a dominant position in the online printing market, and despite the name, PrintingForLess.com, we have never been the least expensive solution out there. It didn’t matter, because we knew that if we could get a potential customer to try us, our service and quality would make them quit shopping around.
“Then, around 2005 to 2007, a mounting wave of [low-cost] imitators began to seriously eat into our growth rate and market share. We were late to realize that our award-winning customer service didn’t matter if people simply price-shopped and picked a lower priced competitor. We waited too long to match our competitors’ prices. That was our mistake.
“We responded by lowering our production costs (without lowering the customer experience) and meeting competitors’ pricing for most of our product line.”
“When we first launched the PrintingForLess.com site it created some stir because we made it easy to quickly get a price, including shipping, for a printing job. Before this, getting a printing estimate usually meant contacting a commercial printer and waiting for up to a week for a price. We were first to market with transparent pricing for commercial printing, and the approximate two-year lead in this space allowed us to grow the market share very fast for a number of years.”
“From the beginning, we have taken a Lean Six Sigma-like approach to nearly everything in our business. The main tenets of this are a vigorous, ongoing campaign to:
- Automate or remove all repetitive, non-value-add tasks from our people.
- Focus most of the time, energy and training of our people on enhancing our customers experience with us.
- Add real value to the transaction at every customer touch-point.
- Give our people a lot of autonomy and give them real-time, transparent feedback on their performance.
- Execute flawlessly on every order.
- Measure and constantly improve everything that drives the above items.”