Vistaprint has seen a 14 per cent boost to its Asia Pacific revenue, after a company-wide shift towards selling more higher value print and printed products.
The increase locally and worldwide, driven by a 10 per cent increase in the average order value, occurs as the company transitions away from its super discount roots. Paul Heath, vice president for Vistaprint in Australia, New Zealand and Japan, says the company is moving away from a price-based business model and is focusing instead on attracting customers who are willing to spend more.
Paul Heath, vice president for Vistaprint Australia, New Zealand and Japan
He says the decision to reposition the brand was made because there is a higher return on investment for higher-value orders and that it wants to change how it is viewed.
The strategy is reflected in the quarterly results; total orders processed fell by four per cent to around 6.8 million. New customer counts plateaued in the US and declined in Europe and the Asia Pacific – the company says this is due to changes to marketing practices and ‘a deliberate reduction of advertising expense.’
However, it does not appear to have hurt its bottom line; Asia Pacific sales in the three months ending September, of which its Melbourne plant is easily the biggest contributor, increased to US$17.8m from US$15.6m in the same period last year.
The Asia Pacific saw a dip in its share contribution as a region to global revenue, down to 5.3 per cent compared to 5.6 per cent in Q1 of 2014 – the whole company, which had a turnover of more than US$1.2bn worldwide last year, made sales US$334m this quarter and doubled operating profit from US$8.4m to US$16.9m.
The quarter’s revenue was a boost of 21 per cent of last year’s $275m, much of it coming from Europe which almost doubled to $138.4m.
Heath says, “Vistaprint effectively invented the low-cost web-to-print model and captured a high share of the price-conscious market to build a big client base, but we needed more than just that going forward. We have dramatically reduced our discounts to move away from that business model, which means while we might be attracting less customers they are spending more.”
He adds that the Asia Pacific results are in line with expectations and he thinks the new reseller focused Trade Advantage program will be a significant source of revenue in the future. He says, “It is a great opportunity to attract a different kind of client and revenue stream. We are excited with the signups so far and a lot of clients have given us multiple repeat orders which shows printers like our offering.”
Vistaprint is offering $100 vouchers for new trade clients to test the company’s capabilities. Heath says, “There has been a lot of misinformation about us out there and we have not been in trade printing before so it gives clients an opportunity to try us without risk.”
