Friday, September 23, 2005

Reflection on an industry learning its way....

One confession. I am a 2Peas message board addict. I love to Pub and all of the crazy goings in the crazy scrapbooking sub-culture. Today, I was reading the blog of Kristina, founder of 2Peas as she talked about the world of scrapbooking. You know, this is something I have spent a lot of time thinking about as well and while she is looking at it from the retail perspective, I would like to talk about it from a manufacturer's point of view. Scrapbooking is an industry that is driven by the latest and greatest. It is all about what is "new" and "hot", defined by the last tradeshow everyone attended. The industry magazines foster that by focusing a lot on the newest trends which drives ad sales and consumer interest. Manufacturers respond by spending a lot of time and energy putting out more and more new products at a high fixed cost. Retailers, wanting the stock the latest items to drive sales, order the new items. So manufacturers have to remove old lines of products to simplify logistics and inventory costs. There are very few staples in the scrapbooking industry. Even cardstock is all about new colors, patterns, and lines. So every company is hoping for the next hit and raising the bar to get it. The thing is that no one is acting irrationally, but collectively, we are all going to find that we are hurting each other. Manufacturers need to constantly spend more to push out new products. Retailers need to constantly change their stock or else get stuck with "unsellable" products. Consumers are paying higher prices for each item. I love the industry and all of the craziness, but I am also realistic about the sustainability of this. We are not going to be able to do this forever. If we continue, a few things may end up happening:
  • Consolidation among manufacturers in order to reduce cost of constant release and marketing of latest and greatest. This will result in less innovation in the industry overall.
  • Increased pressure on local scrapbooking stores due to high cost of carrying and turning over new products, resulting in larger stores and chains.
  • Higher cost for customers may drive them away from hobby.
I love the industry and scrapbooking, and I know together that we find a solution.


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