Driving Business Success Through Coopetition and Specialization

I believe the future of our company, and in fact our entire industry, will be significantly influenced by two factors: specialization and coopetition. In an increasingly complex and technology-integrated business landscape, competing companies are beginning to realize that rivalry and cooperation are not always incompatible. Working together on certain activities can unlock immense customer value which drives, in turn, value to the companies who serve those customers.

Coopetition - working with competitors on shared projects where they share common goals - can reduce waste and duplication, expand market access, enhance the impact of shared technologies, promote synergies and enable smart specialization. Drawing on products or services provided by competitors can benefit both parties, helping to fill gaps in Company A’s portfolio, and giving Company B access to a wider customer base without any cost of customer acquisition. Coopetition can also strengthen a company’s competitive advantage by allowing it to focus resources on areas of strength and create a more attractive overall business offering.

For the last 20 years, the printing sector has suffered declining revenues. Many players large and small struggle as customers increasingly demand lower prices, more convenience, better quality and faster delivery. Specialization and coopetition can help these players not only survive the future, but thrive in it too.

Breaking Down Traditional Barriers

Coopetition is not a new concept, as documented examples of cooperation between rival businesses go back to 1913, when several automobile firms set up the Lincoln Highway Association to develop America’s first coast-to-coast highway.

The technology industry provides many more recent example of coopetition, in part due to the heavy investment needed to constantly innovate, and it continues to be a smart strategy.

Microsoft and Apple - famously known for being fierce competitors, have each benefitted from their rival’s capabilities. The iPod and iTunes originally only worked with Macs, but the portable music player’s mass appeal and success came from Apple launching iTunes for Windows, opening it up to the significantly broader market of PC users. Microsoft Word and Excel first succeeded on the Mac and only later went on to beat WordPerfect and Lotus 123 in the Windows environment.

And similarly, in mobile, Microsoft once pursued a policy of restricting its own Office software to devices running their own operating system. But with iOS and Android completely pushing Microsoft out of mobile, it made sense to have Office available on the devices that people were using. Not only did this move benefit both firms - it made life easier for millions of customers to be able to access software they use on the desktop with the hardware they already had. Many additional coopetition examples exist in today’s technology market including Google cooperating with Apple, and Amazon with Netflix.

Coopetition isn’t limited to technology firms. Automobile manufacturers share resources and technology but compete for customers on branding and design - the tie-up between PSA Peugeot Citroën and Toyota being a prime example. Airline alliances such as OneWorld and Star Alliance mean sharing costs of ticketing, marketing and logistics.

In more general terms, companies can partner on the non-core parts of their business, conserving resources for what makes them best able to serve their customers. Within Cimpress, our own businesses, such as Easyflyer and Exaprint, often source from the same print providers and sometimes compete with one another when serving customers of these products. Yet each of our business also provides its own distinct value proposition, so each is growing nicely. Beyond Cimpress, we also partner with over a hundred third-party print providers who either have competitive elements of their business and/or who sell to our competitors.

How is Coopetition Transforming the Print Industry?

Printing is one of the biggest industries in the world, and one of the most competitive, so we have always practiced specialization to increase the value we deliver to customers. Cimpress’ specialty is “mass customization:” very small individual orders that others traditionally did not find attractive, be that for logo apparel to printing to promotional products or signage. Yet even within that niche, we further specialize our individual businesses and we regularly partner with others, conserving resources for what makes us competitively unique and winning together with them.

More and more customers are, for example, saying how much they value very rapid speed of production and delivery. With that in mind, we might partner with a local printer to be closer to the end customer. Many customers want to customize unique items that we don’t offer, so we might work with an external supplier that specializes in that kind of merchandise. This provides customers with a one-stop shop for their printing needs, and gives our sometimes competitive partners access to business opportunities they wouldn’t otherwise enjoy.

The vision of Vistaprint, Cimpress’ largest business, centers on micro-businesses. Serving these very small individual customers require software-powered systems that fully integrate the workflow from browser-based design to highly automated production lines, then driving previously unimaginable daily order volumes through that system via mass-market consumer marketing techniques that attract tens of millions of micro-businesses. Specialization on serving a previously ignored set of customer needs allowed Vistaprint to succeed.

We see so many specialists out there that do things we cannot. For example, imagine you are a very small custom glassware supplier. If we send you even just five or 10 orders each day, then suddenly, as our customer, you are generating pretty significant business. We would never be able to compete with businesses like that because they are so specialized, but by working together and cooperating, we both benefit. That is what great coopetition looks like. You can also see it in action on an even greater scale with our Cimpress-owned businesses such as Exaprint, WirMachenDruck, and Tradeprint. Their specialist knowledge and networks of print providers are exceptionally powerful and mutually beneficial to us, to our supply partners and, most importantly, to customers.

Fueling the Growth of the Entire Sector

Cimpress believes that companies need to embrace competition, to specialize and to partner, all in pursuit of greater customer value. As we’ve learned from the technology industry, early adopters of coopetition stand to reap sizeable benefits and stake out market leadership positions - which is good for them and good for their partners. We strongly believe that by harnessing the benefits of coopetition and specialization, we are fueling the growth of the entire sector, increasing competitiveness and creating demand where none existed before.