Cimpress: Custom Products on a Mass Scale
From sneakers to suits, consumers today are demanding more and more customization in the products they purchase . How can companies access the scale benefits of high-volume, mass production while still providing customers a highly unique, individualized product?
Cimpress (more commonly known by its leading business unit, Vistaprint) is, at its core, in the business of customization. The company was founded in the 1990s to help microbusinesses with graphic design and small-batch printing jobs[ii]. Today, through its many web-based merchant sellers, the company offers a vast catalogue of “blank” products – ranging from business cards to Bluetooth speakers – that can be imprinted with a customer’s unique specifications, including typeface, logos, and photos[iii]. Whether you need your company’s logo emblazoned on 1,000 pens, or you simply want a single mug with a goofy family photo, Cimpress can help.
Yet this level of customization introduces a fundamental operational dilemma. Traditionally, custom jobs at a local print shop drive unit costs through the roof, as highly customized, small-batch jobs (in Cimpress’s case, down to the level of a single unique production unit) incur significant setup costs[iv]. Consequently, it’s challenging to offer a product that is simultaneously personal and customized, while also affordable and available in very small quantities.
Cimpress, however, believes it can use digital production technology to do exactly that. It is currently investing significantly in developing its own proprietary “mass customization platform” that aggregates orders across its brands and automatically batches and routes jobs to the manufacturing facility that best optimizes cost with consumers’ requested delivery times and locations. By amassing large numbers of small-batch orders from around the globe into high-volume production, Cimpress is able to reduce setup costs, disrupt the traditional trade-off between volume and unit cost, and make highly customized products available to consumers at prices and speeds comparable to mass production[v]. For instance, while a traditional print shop might require over an hour to set-up, print, cut, and box a standard order of 250 business cards, Cimpress requires only 13 seconds[vi] – and can pass those savings directly to consumers.
To further harness the disruptive scale benefits of digitalization, Cimpress is rapidly acquiring custom printing merchants across the globe and migrating their transactions onto its platform[vii]. For example, over the last few years, Cimpress acquired a series of European “upload and print” businesses, and most recently, National Pen, an American producer of pens, key chains, and other promotional products. Not only will additional brands drive greater scale benefits, but the existence of a common digital platform will enable each acquired brand to rapidly access the product catalogues, production facilities, and cost-effective manufacturing capabilities of the entire Cimpress network[viii]. The focus in the near-term, therefore, is to get these new brands integrated into the platform and rapidly launching new products. In addition, as Cimpress develops the platform, it is also looking for new opportunities to introduce digitization not only into routing, fulfillment, and logistics, but into the image production process– for instance, by writing algorithms that minimize the distance a needle travels while embroidering a logo on a t-shirt or automate re-touching[ix].
In the longer term, once the capabilities of mass customization are proven within Cimpress, CEO Robert Keane has proposed a vision to make Cimpress’s digital platform available not only to Cimpress-owned brands, but to third parties; essentially, he hopes that the technology will eventually become the central link in a vast “Amazon-like” ecosystem of merchants and sellers[x]. Keane wants his business to be not just a printing company, but a technology company that happens to print products – much like Uber is a technology company that happens to be in the taxi business[xi].
Given this, I would challenge Cimpress’s management to think more about what it would mean organizationally for Cimpress to evolve from a web-based printing company into a true “technology” company. If its vision is to provide not just custom-printed mugs, but create an industry-leading technology platform, it will need to be capable of recruiting top tech talent, organizationally linking software developers with the customer-facing business units, developing robust data analytics capabilities to fully leverage learnings from the platform, and importantly, gaining business unit buy-in to pilot new technologies in day-to-day operations.
More broadly, I think this points to an open question around the digitization megatrend: are we shifting from a world of product manufacturers that happen to use technology, to a world of technology companies that happen to make products? And if so, what are the implications for us as both consumers and business leaders?
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[i] Bain & Company. “Making It Personal: Rules for Success in Product Customization.” 2013.
[ii] Interview with Robert Keane (Cimpress CEO). CXO Talk. August 28, 2015.
[iii] www.Vistaprint.com
[iv] Interview with Robert Keane.
[v] McKendrick, Joe. “What True Digital Disruption Looks Like.” Forbes. September 25, 2011.
[vi] Ibid.
[vii] Cimpress 2017 Investor Presentation.
[viii] Interview with Bernie Gracy (former Cimpress SVP, Global Products): “How Cimpress is Bringing Customized Products to the Masses.” American Printer. January 27, 2016.
[ix] Interview with Maarten Wensveen (Cimpress CTO): “Manufacturing and Microservices.” Software Engineering Daily. June 21, 2016.
[x] Interview with Bernie Gracy.
[xi] Interview with Robert Keane.
Hello TOM Lover,
Thank you for your interesting article. The similarity in the challenge faced between Cimpress attacking personalisation compared to Li & Fung attacking the internet is really interesting, it seems even twenty years on there is a lot of value to be had from what Li & Fung found to be the online opportunity for them: “aggregates orders across its brands and automatically batches and routes jobs to the manufacturing facility that best optimizes cost with consumers’ requested delivery times and locations”.
I find the final question of your essay very interesting, and indeed the issue faced by Cimpress. I think if they were to look at their main threats in the next decade, most of them would be related to competition rather than obsolescence; is becoming a platform the only way to make the competition join you, rather than challenge you?
I agree with Nico above – as I read this blog entry, I was struck by the similarities between the vision of Cimpress and the intention behind lifung.com.
As Cimpress evolves, it is important to consider how their customer promise may change. In its current form, I would argue that Cimpress conveniently fulfills quality product (per custom order) at low prices, given the cost savings from aggregation. Customers submit their orders to Cimpress and Cimpress analyzes and determines the best way to deliver on their request. In the absence of Cimpress, customers would have to source their own suppliers and pay higher prices to have the products made.
However, as Cimpress expands their platform – and especially as they do so beyond branded merchants – Cimpress effectively becomes a two-sided platform, accountable to both the merchants on the platform as well as customers that require custom prints. What becomes of their customer promise? Is it still rapid delivery of custom orders at low cost – or does it become efficient search and matching between print demand and print merchants? Would Cimpress still be able to harness the cost benefits of scale and aggregation when they no longer own all the merchants on the platform, and do not have visibility or access to their data?
Hey TOM Lover,
Thanks for writing about Cimpress! I’ve seen Vistaprints advertisements and I’ve always wondered how they can sustain a business while offering customized business cards at such a low price point. I’m starting to get a better idea of how that is possible with the statistic you provided stating that a 250 card job at cimpress could only take 13 seconds compared to an hour elsewhere. Your post does bring up some questions though. I am a bit confused as to what the exact logistics / business plan that the CEO envisions could be. I’m having a very hard time conceptualizing how you could take an amazon or uber-like platform and apply it to the printing / customization business. Maybe we can discuss in class!
Great job on this! The impacts of technology on products is definitely having a profound impact on how goods and services are provided to consumers. I think that in the digital age companies can’t be solely a product company or a technology company, but they have to be a mix of both where the dividing line is blurry, and in many situations absent altogether; it’s hard to know where one part of the business ends and another begins. This makes having well-rounded management even more important because specialization in either tech or product is not enough in the digital world we live in.