Archive for January, 2013

State of MGX – 08.03.11

State of MGX

In the last State of MGX, I wrote heavily about what type of printing company that we wanted to become. We would push ourselves to be a company that understood what the potential of printing could be. Since that time, I believe everyone on the team has gained a better understanding of what that means, and how we would get there.

A lot of my time is spent trying to craft a plan as to how we can move forward and grow as a company. For the past 2 years, I feel that we have done fairly well in this regard. We have continued to be a nimble, aggressive company that seeks out new opportunities. Everyday has been new and filled with exciting challenges. In the last 6 months, our company has tripled in size, both in production capacity and personnel.

In addition to this, we begun to take steps that will really build up our internal systems, such as in the realm of software, standard operating procedures, and human resources. Perhaps the most important area of growth has been in how our customers perceive MGX Copy. With a constantly improving website, production facility, and email/telephone presence, we have been attracting a larger and more affluent client base that trusts our ability to fulfill their orders.

As we continue forward in trying to attain our goals, I wanted to again, put down in writing, a general sense of direction as to where we are headed. As always, I welcome as much discussion as possible, and I would love to hear your thoughts.


As we continue to grow, I would like to speak about a concept that is near and dear to me – the concept of Phronesis.

Phronesis is a complex subject, and it is something that I have spent a considerable amount of time trying to understand. In Aristotle’s work on ethics, Aristotle spoke about Phronesis and described it as the “capability to consider the mode of action in order to deliver change, especially to enhance the quality of life.” The simplest definition I have heard is that Phronesis is “the virtue of practical thought” or “Practical Wisdom”.
Imagine if you were an archer. Your goal would be to fire an arrow straight into a target 75 feet away. In this situation, there is really only one way to be successful – make sure that the arrow goes straight into the bullseye.
Think for a minute, however, all the different ways that you could possibly not be successful.
An archer, when they try to hit the bullseye, needs to compensate for myriad variables. The weight of the arrows, gravity, wind resistance, distance, strength of the bow, vision, and even muscle fatigue. The archer has a million ways to miss the target, but only one way to be successful. As it is in real life – it is infinitely more difficult to hit the target than to simply miss it.
At MGX, we need to consider Phronesis in order to make the proper decisions every time. At MGX, the strength of our bows is the feasibility of our ideas, wind resistance is our budget and cash flows, and gravity is our customer’s preferences and perceptions of us.

I challenge our staff to become “phronetics”. Everyday, we are presented with a new set of decisions with complex dependencies. Before you make a big decision, ask yourself –
-Is this what we want?
-Who will gain and who will lose?
-Where will this decision take us?
-What should we do?

Having a clearer understanding of our situations and the impact of your decisions will help drive us in the right direction.  If we take the time to apply honest practicality into our decision making processes,  I believe it will help us continue our pattern of success.

Why Paper?

A lot has been made of the decline of print and the decline of paper usage. There are certainly some elements of truth to that statement, however, I believe that we are in a select group of businesses that will be able to adapt to these changing market conditions and thrive.

I have done a lot of research on this topic, and I truly believe that usage of printing and paper can be more compelling than ever – it just takes an innovative company such as ours to show people this.
First off, paper is the only marketing medium that is easy for recipients to hold. Studies have shown that when you increase the amount of senses that are involved in an experience, the better the comprehension and results. To be able to hold a message in your hands is something that is unique to the printing industry.
“In a Neuromarketing study conducted by Royal Mail through Millward Brown, it was reported that direct mail triggered more activity in the parietal cortex, which is associated with the integration of visual and spatial information. This suggests that print-based material may be more easily integrated into the brain. Because we can see and touch paper, it’s seen as more concrete, and can act as a cue for memory. Subjects also formed more connections between the printed material and their own memories and personal experiences. In contrast, online materials elicited responses in the temporoparietal junction, which has been associated with filtering out irrelevant information.
Jakob Nielsen, Web-usability expert, has also commented on a ‘filtering’ through studies in which he monitored the eye movements of people reading web pages. “The online medium lends itself to a more superficial processing of information. You’re just surfing the information. It’s not deep learning,” Neilsen notes.”
Knowing how the brain responds to a printed product, it is not surprising to know that direct mail generates the highest response rates. Targeted direct mail has been shown to have results in single or even double digit figures, while broadcast media(such as radio and television) have been shown to result in response rates measured in the thousandths of a percentage point. Paper helps people learn better and comprehend better. When we apply this to helping our customers improve their marketing, we can see how this could be a great combination for success.
In a recent Pitney Bowes survey, 81% of people still read the advertising mail that they receive. Compare that to spam emails which are typically deleted immediately. Last year, 85% of businesses reported that they were pleased with their direct mail response rates – leading us to believe that those businesses were able to establish and maintain a positive return on investment through their direct mail campaigns.
The argument that I hear most frequently against paper is that it is not considered to be “green”. The problem with that argument is, that it is simply wrong.
The paper that we source at MGX Copy is almost always FSC Certified. In addition to the FSC Certification, all the paper we use comes from paper mills that get their wood pulp from forests that are managed, and replanted. Simply put, our paper comes from “tree farms” – the more paper we need, the more that they will plant. The perception that paper production results in the destruction of rainforests is really quite off base. In addition to this, paper is one of the most recycled products in the world.

Basic communication may change, due to cost, capabilities, and ease of use, such as the wide adoption of email. However, with the benefits that printing offers, we can see that it can be a more impactful, more emotional medium. In the future, MGX will care less about how much of something we can print, but rather how many people we can impact with printing, such as with Fresh Prints.

Fresh Prints

The last time we spoke about Fresh Prints, it was still in its infant stages of growth and planning. As of right now, much of the foundation has been set, and the application itself is beginning to take shape. It appears that we are still on our rough schedule of having a feature functional application ready by the end of September.
I wanted to share the possibilities that are afforded to us by entering the personalized, consumer printing market, as well as some of the possible integrations that we may have when we transpose some of the technologies into the corporate printing market.
Fresh Prints, as it stands right now, will be an online photo album creation tool. Users will have the ability to create their own digital photo albums that can be shared or printed for keepsake and entertainment purposes. Fresh Prints will also have the capability to change how personalized media products are created and distributed among people. Not only will our software allow for creative collaborations among members in a group, but workload sharing and personal input will also be supported. To clarify this point, I’d like you to think about how much more engaging, emotional, and fun it is to have friends or families, team members or co-workers, all working together on a photo project if they so choose. Imagine the applications that we could build towards, such as calendars, collages, and even yearbooks!

The software that is currently being developed is an online preview tool that shows how your pictures would be laid out on a page if you were designing your own photo album. With the code that is being written, we should be able to expand the possibilities of that platform into the corporate printing market.
Imagine if you will, the possibilities that the Fresh Prints platform provides for our corporate customers. The Fresh Prints application allows for adding and removing content, such as text. In many large corporations, there are “shell” documents that basically outline what the templates should generally look like. These can be applications, location specific documentation, and even business cards. Many large companies need a place where they can go to order these products, customize it slightly, and have it printed and delivered to their location in a quick, professional manner. We would be able to start offering a centralized ordering platform for large organizations that are greatly interested in efficiency.

Currently, the products that generate the highest amount of revenues for MGX Copy are booklets. Wouldn’t our customers stand to benefit greatly if our website could show a preview of what their booklet would look like prior to printing? Wouldn’t we be able to eliminate a huge number of samples and layout requests with an online digital proofing system? Wouldn’t we be able to help curb the number of full bleed questions and full bleed issues when we can show an online preview of what their file would look like when it is actually printed? The customer service and sales team will have a very powerful tool in helping to shape customers perceptions about the product that they will be receiving. It should go without saying that MGX will likely benefit greatly in regards to revenue and a more positive customer experience after we implement these systems.

From Print Shop to Business Solutions

The way that our customers have interacted with MGX will change dramatically starting in the next few weeks. Customers have always had to find our services when they realized that they had a need for printing. They would contact us, and we would help answer any questions they have had.
With a greater emphasis on attracting new customers directly, we will begin to start teaching and informing new customers about our products and services. It’s been no secret that we have had one of the most compelling printing businesses in San Diego because of our combination of quality, great service, quick turnaround, and price. The problem with being a startup company is that we are not yet as well-known as we would like. The sales team will push to make inroads on this issue by going out, meeting customers, and gaining their trust.

I have shared with the sales team the exciting possibilities of a new service that the Post Office now offers – saturation mail. Saturation mail allows us to send out direct mail pieces on behalf of our clients, at a lower rate than what bulk mailing rates currently charge. What’s meaningful about this new mailing service is that we can now hit residences with location specific, targeted mailing campaigns in a manner that is even less expensive than before. Saturation mail will provide value to any type of business that needs to attract customers in its local vicinity.
As we begin to approach new customers with our newfound capability to target specific locales, our company will begin a meaningful transition. No longer will we just be a printing company, but rather a print marketing solutions provider that helps companies attract and grow existing customer bases through print media.

As exciting as these ventures will be, and as fruitful as they will become, we have to maintain our even keel and maintain proper phronesis as we pursue these goals. Saturation mail cannot be the focus of what we offer, at least not yet. Too much of our company, from our website, to our image, to our marketing, and even down to the way we speak and think, revolves around us being a printing company. This may be a paradigm that we are used to and will eventually transition away from. But at this point right now, we will have too difficult of a time competing and speaking about print marketing. The transition to become a business marketing solutions provider will take time, effort, and a few stumbles before we will accumulate a strong enough customer base to sustain our revenue requirements. Make no mistake – we will get there. But we need to make the transition in proper time in order to keep our credibility with our current, as well as our new customers.

As it stands right now, sales from MGX Copy come directly from the website and online advertising efforts. We will maintain and continue growing this segment of our company. Our outside sales team and its budget will be independent of our Google and Microsoft advertising budgets. I have found that a quick, hard transition in regards to sales, is rarely successful. It is best for us to continue doing what we do well, while trying to grow a new piece of the pie.

Final Thoughts

Starting MGX Copy required a huge investment in equipment and machinery. With 3 fully operational, high quality/volume digital production presses, we are now able to handle a volume and variety of print orders that we were previously unable to do. In support of these production presses, we have either purchased or continued maintenance on new bookletmakers, paper cutters, and paper folders. Investment in equipment from here on out will likely seek to improve the quality and speed of our current offerings, not necessarily to develop and offer new products altogether.

I believe we have also made a smart business decision by outsourcing our perfect binding jobs. Without the relationship that we have developed with International Bindery here in San Diego, we would need to bring on a trained operator, plus invest in a perfect binding machine and cutter. What would add to the complexity already generated would be the labor that it might take to complete these jobs. We will look to bring perfect binding in house after we have secured steady orders of over 10,000 books a month.

The last couple of years should be characterized as setting the vision, foundation, and equipment base to support MGX Copy to grow into the future. Now we are in a phase where our investment is in our people and we have since added additional software engineers, sales staff, customer service staff, and production staff.

I believe that a struggling company looks at the human element of a business, and thinks about them as a necessary cost. I believe that a growing company looks at the human element of a business as a source for growth and inspiration. With the new people that have joined the company, I expect that they will bring about great new ideas and great new viewpoints that will only seek to help propel us into the future.
I’m more excited than I have ever been with regards to the opportunities here at MGX Copy. Our company is sprinting towards a new future – one that is filled with Fresh Prints, new corporate offerings, and a team of core members that will strength and develop our company.


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