Tip of the Week

Business SMART:	The Power of Market Synergy!
	By: Dennis A. Conforto A-Z Media Group

I have often talked about the importance of the PMA (Photo Marketing Association) relationship to the Scrapbooking Industry, but there are still some that just don’t see it. They don’t feel it and in the end they just don’t get it. I believe it’s because they simply have not been exposed to the synergy found within the massive photo community. For those that have been exposed to this market synergy, the evidence has been overwhelming and the experience undeniable. This past week in Anaheim, California, a group of scrapbooking retailers and manufacturers met with a group of photo retailers and manufacturers. The purpose of the meeting was to create retailing market strategies for both groups. Two key attendees, SONY and Longs Drug Stores, sent lead executives to attend the meeting. To get it all in perspective, Longs Drug is twice as large as the worldwide scrapbooking industry. Sales for Longs last year were $5.1 billion over 500 locations throughout the southwestern United States. And SONY is one of the world’s largest most successful world brands. The question is why would SONY and Longs Drug show up to a meeting in Southern California to meet with a group of independent scrapbook retailers? Why would SONY fly executives all the way from New Jersey and Longs Drug from Northern California? The answer is PMA! I am stunned at how well-connected this association is, but even more impressed by how respected they are by their membership. As I started presenting my prepared material, I suddenly realized that this meeting was too unique. Because of those in attendance, I decided to ignore my own material and changed to fit the flow of the meeting. The reward was the power of market synergy. I posed this question to the two Longs executives, “Why are you interested in the success of independent scrapbook retailers or are you even interested?” Their reply was, “The success of scrapbook retailers is critical to our success in photo processing which is a traffic-driver into our stores.” I then asked, “Is there another outside relationship beyond scrapbook retailers that can bring you more success in photo processing?” Their reply was "No, nothing else comes close.” That was a turning point in the meeting. Longs Drug Stores reached out to these scrapbook retailers to seek ways to do cross promotions to increase traffic for both industries. Everyone quickly realized the connection between growing scrapbooking and growing photo processing. For over a year now I have struggled with the idea of how we get scrapbooking to have more market exposure. There is simply not enough store traffic for the category. One idea was to create a weekly, and eventually a daily section in newspapers for scrapbooking and photo content. I pushed hard for the creation of a newspaper section simply called “Scrapbooking”, where you could find advertisers and content on the subject. I wanted to have this section in every newspaper in North America. It is logical to me since the movie theaters have a section as well as other retail industries like auto, groceries, and real estate. The newspapers were not interested in the partnership. They felt there was no financial viability, since they would have to employ a reporter to create the content and the local human interest story. They couldn’t see any real measurable money being spent on advertising for scrapbooking products, and thus no reward. But that has now changed; it changed because the newspapers now understand the financial return of including a scrapbooking/photo section. Before last week there were about 15 independent retailers in Southern California that made up the SMART Co-op Marketing Team. They worked hard and came up with some creative ideas to cross promote each other. However, they had little to no impact on any newspaper willing to promote scrapbooking. Now fast forward to this week. We went from 15 stores to about 525 retail stores who want this section in the newspaper. Why? Because Longs Drug Stores joined that committee and for the first time we have some real market power with a retailer who spends at least $250 million in advertising! Now do you think we have the ears of the newspapers in Southern California? I KNOW we do! Soon this group of retailers and I will be knocking on the doors of a major Southern California newspaper to put this deal together. Once done, other newspapers from across the country will follow suit. We are beginning to move the two industries together as they always should have been. Scrapbooking retailers in Southern California now get the power of market synergy. They now know and understand the power behind PMA - particularly its impressive group of cross-promoting independent retailers, whose best interests are to promote scrapbooking as a reason to print a photo. In the Scrapbooking.com Consumer Trend report, data now also comes from PMA. It clearly shows how each scrapbook page displays an average of three photos. The whole photo industry wants and needs more consumers to have more reasons to print more photos. There is more money to be made by photo retailers seeing traditional scrapbooking grow. Until the meeting in Southern California, Longs Drug Stores feared the independent scrapbook retailers - today they embrace them. Last week the independent retailers feared Longs Drug Stores - today they want a partnership. Of course none of this could have happened if it wasn’t for PMA. Those that fear PMA simply don’t understand what it means to fully cooperate and integrate into growing our revenues. They fear and run, rather than looking seriously at the power of market synergies. Funny thing is the newspapers get it, the photo retailers get it and the scrapbooking retailers now get it. Soon scrapbooking manufacturers will need to think more about revenue growth and less about the fear of change. Everything that was discussed at the Utah Summit Meeting will happen within a week and more. Manufacturers will have the new layout for the co-located shows of both Memory Trends and PMA. They will see the same value pricing that Memory Trends always provided the Scrapbooking Industry. Both PMA and Memory Trends shows will be in the same building at the same time with separate entrances and separate halls, but from which any retailer from any industry will have access to. Both exhibit areas will be joined together in the middle where the PMA SMART Store will be located. And the educational tracts that PMA is famous for will be integrated into the Memory Trends educational programs. Those that loved the Memory Trends show because of its total focus on the scrapbooking industry will still be satisfied. It will continue to be pure scrapbooking at its very best. Those that want to link up with the photo industry for even more synergies can and should. For the first time the photo industry will see the full power of the scrapbooking industry and in turn the scrapbooking industry will see the full power of the photo industry. It is the best of both worlds and everyone wins, especially the millions of new consumers who knew nothing of scrapbooking but will now be exposed because of PMA and the power of market synergies. We now have in place a powerful committee of scrapbooking executives made up of leading retailers, manufacturers, publishing firms, retail chain stores and service providers. It is this group that is working hand-in-hand with PMA, who is leading the way to help insure our future growth. They are executives who are leading by hope of a brighter day. They have reached out and have found within PMA committees of other independent business owners in other industries who are on the very same page. Soon the Scrapbooking Industry will see and feel the powerful influences of PMA’s worldwide marketing presence. They have invested heavily in our futures and have only just begun. Over the next few weeks, we will be announcing the details for my 25-city tour as we begin to gather retailers and manufacturers from both industries to create more market synergy. Please join me for these meetings and be a part of the most significant effort to promote our industry on an ongoing basis. The power of market synergies is real and is just now starting to work for you today. By playing a role you will make a difference in the industry that will count, and that’s what being business SMART is all about.