As long as people are people, they will always have the urge to collect and showcase photographic images of themselves and of the people, things, and places they love or care about. And as digital cameras have made capturing those images even more convenient and affordable, a new industry that caters to this urge is expected to experience a quiet but sustained growth. That industry, in case you haven’t heard of it yet, is known as scrapbooking.
As defined by the industry’s originators, scrapbooking is the artistic way of compiling and preserving photographs and souvenir items in highly customized albums. It is distinct from the traditional scrapbook method in that it uses not the typical off-the-rack albums but ones that offer a wide range of decorative papers, specialty leather strips and stickers, and other types of personally chosen embellishments.
In the United States where the fairly new industry started getting noticed around 1998, scrapbooking has grown into a $3 billion business, recording a growth rate of about 20 percent over 2004-2005. In the Philippines, however, it is still very much in its infancy, posting only a very modest but steady growth during the past six years.
Thus far, the few major local players in this industry have put up scrapbooking stores only in the major high-traffic malls, with some also selling their products and services online. There are quite a number of home-based players in the industry, too, most of them also using the Internet as their main sales vehicle. It is therefore still largely an open country for prospective small-scale entrepreneurs.
As might be expected, the primary market of the scrapbooking industry is the broad spectrum of women ranging from new mothers to professionals who have reached retirement age. Generally, they belong to the AB market segment, own either a digital or analog camera, and are sentimental and avid collectors of photographs and all sorts of memorabilia, including old letters and notes as well as used wrappers and tickets.
Startup
Scrapbooking is an art form by itself so those intending to go into the business need to first learn its aesthetics and craft. However, as there are no formal scrapbooking training courses in the country yet, the quickest and most practical way to learn the craft is to work in one of the reputable and well-established scrapbook shops, most of which are located in Metro Manila.
One of the pioneers in the scrapbooking business is Jocelyn Ong, owner of Memory Box at Robinsons Galleria along EDSA and Ortigas Avenue in Quezon City. She not only offers scrapbooking services to customers but is also a major supplier of scrapbooking supplies and materials. As part of her business strategy, she gives basic scrapbooking lessons for free to those who want to do the business part-time.
To get those who train under her started in the business, Ong recommends hosting a series of scrapbooking parties in their own homes. A scrapbooking party will typically consist of a hands-on lecture and training session for people who want to organize their own photo collections and mementos in highly personalized ways. All the host needs to do is to provide some snack food—perhaps a box of pizza and some homemade pasta—and she is all set to invite friends over for the scrapbooking session.
By sourcing the scrapbooking materials and supplies for the party from Ong, the scrapbooking party host gets a sales commission from her. On top of this, the host will also get sales commissions for all other merchandise that the guests may purchase at the “party”. Scrapbooking parties are therefore a win-win proposition for both Ong as supplier and for the party host as learner of the craft.
Every scrapbook enthusiast typically will need and also buy a starter tool kit that consists of special scissors and punchers, acid-free tapes, adhesives, glues, and reference materials. Ong supplies that starter kit for anywhere from P2,500 to P5,000.
Joining scrapbooking bazaars is another good way for an entry-level scrapbooking entrepreneur to discover which scrapbook designs and merchandise have high demand. Ong helps out by supplying prospective scrapbooking bazaar participants with merchandise either on an outright-sales or consignment basis. Somewhere between P1,500 and P5,000 will be needed by the bazaar participant to cover the cost of the merchandise and the booth rentals.
Investment required
As mentioned earlier, Ong is now on her seventh year in the scrapbooking business. She started in a big way with an initial investment of as high as P1.5 million, putting up a store in Robinsons in 1999. Since she had to grow what was then an essentially nonexistent market, the return on her investment was rather slow in coming; in fact, it was only four years later that she broke even. Today, she is finally beginning to reap the fruits of her investment. “This business won’t make you rich quickly, but you also won’t lose big and it definitely can give you a very strong sense of fulfillment,” she says.
It was while she was visiting in the US in June 1998 that Ong discovered the scrapbooking business. Knowing that Filipinos are very fond of taking pictures—“Mahihilig talagang magkodak-an,” as she puts it—she figured that the business could have a big marketing potential in the Philippines as well. Before taking the plunge into the business, however, she attended several scrapbooking trade shows in the US and got in touch with several suppliers there to look into the possibility of importing scrapbooking supplies to the Philippines. As she looked deeper and deeper into the business, she got hooked: "I developed a very strong personal interest in the craft and I didn’t stop until I carried not only some but most of the more popular scrapbooking brands in the US. I am in this business for keeps.”
Different strokes
What led Melody Chan, owner of SMILE Scrapbooking and Photobook Express at SM Megamall in Mandaluyong City, into the business was exactly the reverse of what attracted Ong to it. Ong saw scrapbooking as a business from the very start, but Chan was one who was already a passionate enthusiast of the craft to begin with. “I wanted to do something I was already familiar with,” she says, “so when I went into the scrapbooking business, it was simply to get a feel of the market and to see if it was worth going into,” she says.
Chan got started in the business in 2001 by joining scrapbooking bazaars. She did so because she wanted to get a much better idea of what the demand was for the craft. “I saw that that there was a lot of work that needed to be done in the scrapbooking business,” she recalls. “We needed to educate people first. We needed to create the market.”
Determined to start it right, Chan studied the business very carefully before getting into it. She looked not only into the operations and merchandise offerings of the existing scrapbooking stores but also the various options for sourcing scrapbooking merchandise and supplies. In the process, she found out well ahead of time that by directly importing the items, one can have sales margins of as much as 50 percent after deducting freight costs and other charges. In comparison, one can get as much as a 30 percent wholesale discount when sourcing them from local distributors.
Marketing strategies
Since the scrapbooking industry is still very young, the key to its growth is educating its potential customers. People need to know how scrapbooking can relate to their lifestyles and enhance them. In addition, scrapbooking has a very fickle and demanding market. Manufacturers therefore have to be very quick in coming up with new product concepts and designs even if they have just released their latest product offerings. “In this business, for your old stock to have a chance of being sold at all, you just have to patiently create new markets for them,” says Ong.
Apart from hosting scrapbooking parties, most of the scrapbooking dealers and stores make a continuing effort to perk up demand by issuing membership cards with discount privileges. They also run periodic marketing promotions such as anniversary sales and seasonal discounts.
Most companies simply join bazaar events organized by outside groups. In the case of Ong, however, she makes it a point to organize her own scrapbooking events and bazaars in the clubhouses of upscale residential villages. She usually charges a minimal entrance fee to cover the venue rentals. As come-ons for people to attend, she raffles off attractive merchandise prizes that she mostly solicits from her suppliers, serves cocktails or snacks to the guests, and gives hands-on lessons to those interested. She also gives special discounts to buyers of her scrapbooking materials and supplies and holds thematic contests among the participants. A mainstay in her scrapbooking events is the “make-and-take” contest, in which the participants may create their own scrapbook on the spot using the available materials for free and take their scrapbooks home afterwards.
To create even stronger public awareness about scrapbooking, Ong also goes on tour to selected target schools, giving basic scrapbooking lessons to interested mothers. Every now and then, she also guests on TV talk shows and arranges for the scrapbooking craft to be featured in leading newspapers and magazines.
The risksLike any other business, scrapbooking is not entirely risk-free. One major risk area is making the mistake of buying scrapbooking supplies made from materials that are not really acid-free—a factor that greatly reduces the lifespan of a scrapbook and can cause great consternation among customers, who naturally expect their scrapbooks to last even beyond their lifetimes. Good-quality scrapbooking materials made of truly acid-free paper and tape can last for 15 to 20 years without discoloring, but materials made of ordinary paper or counterfeit acid-free paper begin to discolor after only five to six years. For this reason, Chan explains, it is very important to
source materials only from respectable suppliers and to sell only materials and supplies that carry a well-respected brand.
Business seasonality
One major drawback of the business is that the demand for scrapbooking is highly seasonal. It ebbs and flows with the available discretionary time of the craft’s hobbyists and enthusiasts. December is its slowest month because many people do a lot of holiday partying or go out on long vacations. The summer months of March, April, and May are also low points for the business. Still, many enterprising scrapbooking entrepreneurs manage to get by or even pull off hefty sales increases by coming up with imaginative seasonal programs and sales incentives for their customers.
Despite this seasonality factor, however, Chan thinks that the scrapbooking market will grow even bigger in the next several years: “As digital cameras become more affordable, so will the number of images that will be captured on film and paper. Surely, there will always be a need for organizing and showcasing those images into a premium-quality scrapbook.”
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