Response to negative marketing tactics from “competitors”

Hi all. Sorry I have not written in a couple of weeks. My wife said we needed a vacation. Having been married for nearly 5 years, I know when to listen to my wife (usually).

During the time off, an interesting topic came up from a reporter as to why we have not been more aggressive about responding to some of the outrageously negative marketing practices that have been utilized by a “competitor.” We stated that we simply will not sink to the level of this other organization, and we have chosen to take the high road. Our assumption is that the average customer sees right through all of the negative campaigning. In fact, our customers frequently commend us for taking the high road. But then it hit me: The web is still a bit of the wild west. It is a great place to find new information and new services, but it can not be policed for mis-information as effectively as a newspaper or TV report. Every person isn’t going to take the time to actually read the details of this other organization’s mis-interpretation of the facts. Therefore, I am going to spend some time responding to the negative marketing campaign efforts that another organization is using to clear the air and represent the facts accordingly. Frankly, I don’t even like wasting my time with this, but I think it is important, because we are committed to offering our customers the best photo, negative and slide scanning service out there, and we’ve built a first class organization and scanning process in order to do so.

One of the major criticisms is that we send photos, negatives and slides to India to be processed, and that we have attempted to hide this from the customer. Let me be as clear as possible here: we are extremely proud of our highly trained technicians in India and we have, from day one, been very clear about where images are processed. Our Bangalore facilities are first-class and so is our team. We took the time to hire the right people (read about our head of operations there, Naren Dubey) and build a very sophisticated, world class logistics system to track all packages and ensure their safety. As is noted on our Web site, we use only world class courier services such as FedEx and UPS who allow our customers, as well as ourselves, to track packages at any time. We take the security of our customers’ images very seriously; period. We have built worldwide secure global connections that any logistician would be proud of. Since we started, we have processed over 1.75 million images and have not lost or damaged a single one.

They’ve accused us of misrepresenting ourselves regarding a placement in the Wall Street Journal, which is posted on our site. As regards to the WSJ comment: it’s quite simple, we were mentioned in this WSJ article as having the highest resolution for the lowest price. We make no claim as to editorial endorsement anywhere on our site and never have. To not expect us to put such a prestigious mention on our website is beyond ignorant – any right thinking business would do the same. We say on the site that the article “shows that ScanCafe offers the highest resolution service at the best price.” In the article, we are included in a table that compares us to several other vendors, and this is exactly how we are positioned in the article. We are proud of this placement and want to share it with our customers.

Lastly, we’ve been criticized for not being forthcoming about our prices. Our price comparison chart has been available since January 2007, and we mention our low prices on several other pages on the Web site. Our pricing is low (starting at 19 cents for 3000 dpi for 35mm negatives ) and is one of our greatest selling points. The other is that users only have to pay for the images they want to keep (with a minimum of 50% of the images that are scanned). This has turned out to be a revolutionary idea that saves users tons of time and energy upfront and our customers love it. They no longer have to organize everything in advance; no one else comes close to offering this type of service.

This is simple: We won’t sink to the level of degrading a competitor’s business just for the sake of improving our own. When we launched the service, we were attacked quite aggressively by existing “competitors” because they knew that they wouldn’t be able to compete with us on price – but if you actually review our service, price is not nearly as powerful as the ability for customers to send us all of their images and then review online and then be required to only purchase 50% of the images sent. We have removed the labor from the client – if you use any other organization, you have to spend a large amount of time sifting through all of your photos to determine which ones to send in because the pricing is so high. With us, you spend three minutes at a computer when placing the order and you are done. Also, because you can review on line, you don’t have to waste time holding negatives or slides up to a light source (most people don’t have imaging tables or optical loops) to determine which ones to send in. Simply send me everything, I will scan it all, and you only pay for the ones you want to keep (with a 50% minimum). This is, after all a SERVICE and it suppose to be easy for the customer.

I will leave it up to smart customers to decide whether or not to believe a competitor who, through his own actions, has shown a great deal of paranoia. I reiterate, we let our service and our track record do our talking for us. We also encourage test orders – we have no minimum order size so send us a single image if you like and let us prove the value.

We at ScanCafe will continue to remain positive business professionals and focus on delivering a quality service to our customers, rather than engage in any negative marketing tactics towards other organizations. We feel our service speaks for itself and we will do everything in our power to ensure that our customers are getting the very best of every single person on the Scan Cafe team – that is my pledge to you. We appreciate your business and if there’s anything you feel we could be doing better, we’d like to hear about it, so please send us an email at any time.

User Comments

  1. August 18th, 2007 robin solis

    Dear Entreprenuers, my experience says this man [Sam Allen, CEO of ScanCafe] is completly on the level. When we launched our first revolutionary company (DG Systems, Inc.), which was the first national digital media distribution company in the US (1992); one local company (an analog tape duplicator and mail distributor) that felt threatened (& rightly so) launched a fax campaign to all their existing clients (soon to be our clients) accusing our company of all kinds of goofy things and ranked us just below the devil himself! I kid you not. DGS was and continues to be the dominant and frankly, the only player out there still-ten years after we cashed out.
    It is called progress or competiton, and as long as your company is honest and ethical, this is business democracy in action.

    Robin M. Solis
    silent partner and co-developer of DG Systems, Inc. (DGIT-Nasdaq)

  2. August 19th, 2007 Brian Libeer

    I recently saw Sam at our high school reunion. Knowing Sam for 24 years now, I know this is the core of how Sam lives. Taking the high road is the right way and just the natural way for Sam.

  3. August 21st, 2007 carlos

    Your website mentioned some time ago that you were overwhlmed by demand and that it would take 6-8 weeks to process orders. You also aluded to new equipment that would improve the turn around time. Your prices are fair (which explains the high demand).

    When are you going to improve turn around service? It is the one thing that keeps me from sending you many more photos to scan.

  4. August 21st, 2007 Srini Venkat

    Your website home page says you will return to 4 week turn around by mid-may … is that mid-may 2008? If 07 why are you not updating the website and only the blog?

  5. August 22nd, 2007 Sam - CEO

    Hello Srini and Carlos,
    Your questions are similar so let me address both of them here. Our turn around time is about 4 weeks from the time we receive your images until the time you have them returned to you with your selected scans on a disc. We officially give a much broader range (4-6 weeks generally) because the time changes significantly depending on the order size. People routinely send us orders of greater then 1000 images and it simply takes a bit longer to process and enhance an order of this size. You will actually get to review your scans online in about 3 weeks for an order size of less than 750 images (after selection, it takes about 10-14 days to burn the disc, conduct quality control, and get the order returned to you via UPS).
    To address the rather large amount of demand, which is increasing by the way, we more than doubled our processing team and put in place about $250,000 worth of additional scanning equipment – this has allowed ScanCafe to exceedingly meet spikes in demand. Most of the scanning companies out there have a 4-6 week turn time (unless you want to pay a higher price for an “expedite” service so we feel that we are back to the industry norm at 4-6 weeks).
    Re: erroneous information on our website – thanks for catching that! We look at it so much that we look right over obvious mistakes and we thank any of our customers or potential customers for pointing out such errors.
    Best
    Sam

  6. August 25th, 2007 Frank

    I worry about the international shipping expenses and privacy. Shipping even small, light boxes overseas can be an expensive proposition.

    I have looked everywhere on your website to get an idea of what the shipping and handling costs would be for a small trial order and have not located any information that is relevant. Is it free? I called UPS and asked for a quote on a box weighing a pound or less. They estimated a cost of $15 to $25 dollars each way. If this is the case, any savings realized using your service would be lost.

    The second question is with respect to privacy. All of these items are subject to inspection by the various customs departments of the US & India. What happens if packages are inspected and items inside are damaged, lost, or seized. I by no means paranoid, but I know other photographers who have be ‘questioned’ due to the content of their images.

  7. August 27th, 2007 Chell

    I just read the Blog posted about the negative comments made by a competitor. Now I am going to guess it is by DIGMyPics who has a whole page dedicated to scancafe. Sadly it pops up on the top of the page when you google scancafe. They have sponsered the link yet when you google their name they have not even sposered their own site, makes no sense to me.

    I find it interesting that they are so willing to say your price comparisons are misleading when they are blatantly doing the same thing when it comes to the requirement to purchase a hard drive. They don’t mention it is only if you order 200 or more images in TIFF format, they make it sound like any 200 images will require the purchase of a hard drive. Perhaps the few examples they placed on their page are the few exceptions where their price might be slightly lower….. But I know from personal experience the chance of someone actually wanting all the negatives they send in to be scanned is slim. I love the feature that allows you to discard up to 50%. For negatives and slides that is huge. With negatives you can’t just cut the ones you don’t want out so sometimes you even send ones you know you are not going to want to keep, with other services that is like throwing away money.

    I have sent 2 orders to scan café, one just recently, and the other I got back a few weeks ago. My first order was all 35mm negatives and I was very pleased with the result. The first DVD I received was not working properly and several images I was not able to copy over to my computer but I emailed customer service and they sent me a new disc out that worked perfectly. I do wish you were able to scan single negatives since I have some that were cut. I know you keep adding to your offerings so maybe that will become and option in the future. Even better would be if you could scan negatives from old Disc cameras….

    I even put something on my Blog about using scancafe and have recommended you to several friends and family members not sure what to do with all their old negatives and slides. I have already started pulling thing out for my 3rd batch to send in which I will send in when I get back what I have already sent in.

    Thanks

    Chell

  8. August 27th, 2007 ceo

    For Frank:
    Our UPS shipping is about $5-7 each way but it really depends on the size of the box (people send us 10,000 images which can weigh 85 pounds and, naturally, shipping an item such as this is expensive). You can also feel free to ship via USPS, the only problem is that we can’t then track it for you – this is why we, along with most folks in the scanning business, highly recommend using UPS or FedEx. In order to see shipping charges, you have to go through the initial steps of placing an order (which you can then delete, we don’t “force” you to place an order just to see the pricing) – in the next version of our website, we will have a “pricing calculator” which will display all the pricing elements of a given order without going to the order entry page. Re: overseas costs, you don’t incur those, ScanCafe does. By the way, I am quite surprised that UPS quoted such high prices to you – did you ask for overnight service?
    Re: privacy issues – this is a major concern for anyone with imagery and we take it very, very seriously. You can read our terms and conditions and privacy statements at the bottom of our web page. I won’t bore you or any other reader with the intricacies of international air freight logistics and processing, but we at ScanCafe are incredibly experienced in this area; Scan Cafe has all the requisite import/export bonds (this drastically reduces the intrusion of customs); and we have professional relationships with both the Minister of Customs in India as well as the customs teams in San Francisco. Customs has never been an issue for us and they never “seize” material of this type. Also, keep in mind that we offer a full 100% shipping guarantee that covers any type of risk you mention – our guarantee is $1,000 and a free lifetime of scanning services should your order get lost AT ANYTIME while in possession of ScanCafe or its partners. The only thing we don’t cover is while your shipment is in the hands of domestic UPS. Some of our competitors keep trying to find loopholes in this guarantee – there aren’t any; its ironclad. Lastly, let me just say this – we have now scanned over TWO MILLION images and thousands of orders and have yet to lose a single order.
    Thanks for your post and sorry for the long winded reply – please feel free to call us at 1-866-745-0392 with any further questions and good luck with your scanning efforts.
    Sincerely,
    Sam

  9. August 27th, 2007 ceo

    For Chell re: pricing
    Thanks for your post. Yes, our friends at DigMyPics continue to twist the truth (ironically on a page titled “the truth” or something like that). Here is the deal for everyone to read: ScanCafe requires that you buy a 120GB pocket hard drive should you order at least 60GB worth of TIFF imagery (this works out to around 880 images). We used to have the bar set a bit lower, which is where they got the 200 number. This is in lieu of sending a customer about 15-25 DVDs so we don’t think its that big of a deal. Given that we have ZERO COMPLAINTS about this, we will keep it intact. I don’t let “competitors” drive my business – but I do listen to my customers. Which is why ScanCafe has such a great and unmatched service. These pocket hard drives are actually sought after by many of our pros and are even ordered when not required – a pro or hobbyist can put an entire portfolio on a drive that fits in their pocket. I think that is a pretty powerful tool. And for a company that makes its customers buy CDs or DVDs (the initial set is free at ScanCafe, although a customer can choose to purchase additional sets), has minimum order sizes (Scan Cafe has zero) and charges ridiculously high rates, DigMyPics is showing a bit of hypocrisy in its claims. But I digress. I saw your blog, and am glad that you and your friends are enjoying your new digital images – this is what makes us happy, knowing that we made people’s lives better. And tell your buddy I like his red mohawk.
    Best
    Sam

  10. September 18th, 2007 Gopi Ayer

    I am intrigued by your business model and would even say that it appears you have executed an idea that I had toyed with at one time. My main interest is in scanning large format transparencies. Typically, a 4X5 film scanned on a Tango or similar drum scanner coss tens of dollars per scan. Any intervention adds to the cost. When I was in India, I explored a drum scanning service, but frankly the logistics were beyond me. You have the logistics in place, and adding a premium drum scanning service will be well received by the larger professional community. As a physican, if I can live with radiology and transcription services from India, so can the imaging professional when the cost savings are factored in. Any prospects of this?

  11. September 26th, 2007 Sam Allen

    Hi Gopi,
    We don’t scan images of that size or type yet, as you know. Prices for scanning images of that size are certainly a function of the original cost of equipment; but they are also a function of the amount of such images out there to scan. We get such few requests for this media type at ScanCafe that it hasn’t been worth the up front investment. That stated, there is a sort of “chicken and the egg” syndrome here in that, until we offer the service, we can’t be sure of the “take rate” or demand. Fulfilling this media type is on our roadmap but I can’t give you a good date on when we would launch this offering. I think that the scanning opportunities for physicians is quite large.
    thanks for you query and all the best,
    Sam

  12. October 17th, 2007 Yuri

    Sam, I was a excited when found I could send you all the negatives, but then I saw the 50% minimum requirement.

    Why don’t you scan all the negatives with a flatbed like Epson v750 (or the cheaper analogs), do no manual correction on images, let the user choose, and only then apply manual labor on the images that are (or will definitely be) paid for? This way you’ll be able to eliminate the 50% min requirement. Which for me is a deal breaker. All my negatives are pre-cut to 4…6 frames, and it’s not unusual when I really care only for one frame out of those 6. Forcing me to pay for at least 3 of those 6 makes no sense (or multiplies the cost 3 times, making it not so attractive as it initially appears — remember, we’re talking about black-and-white here?).

  13. October 18th, 2007 Sam Allen

    Hi Yuri,
    Your idea has merit – but would actually be very difficult to make happen in our operational backend as we would scan, then wait for user response, then complete the order – we have too large a scale to accept this type of “stop and go” process. Also, we have had extremely few requests for this type of service (your is only the third I can think of in the past year). Given that every other scanning service makes you pay for everything you send, I think we still have an outstanding value at a 50% minimum. You could, of course, cut the negs and send to us for conversion and then this wouldn’t be an issue – but of course this also means a fair amount of labor on your side. If you had slides or prints to send along concurrently, that would reduce your drop rate and allow you to hit the 50% minimum requirement.
    Again, your idea is a good one, but we can’t at this time make that happen. If you would like to buy your own scanner and do the work yourself, you can find lots of good info on our site on which scanner to purchase and how to actaully scan the imagery yourself. You can always drop us a line directly at admin@scancafe.com with more questions. Thanks for the post
    Sam

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