Part two of three
A year is both a short and long time for developing trends in the document management and digital print space. Last week, we kicked off our Year in Review article with a look at developments in the customer communications management space provided by independent analyst firm, Madison Advisors.
The second installment comes from Dave Erlandson, GM, Caslon & Company and PODi. It helps companies leverage digital media and technologies, especially relevant direct mail and digital printing. Caslon generates industry research, creates content, tools, and business resources for solutions providers. Caslon is the management company of PODi, a global, vendor neutral industry initiative with hundreds of printing industry members.
In the following excerpt, Erlandson discusses noteworthy trends and developments he’s come across in the past year, including the continued decline of the newspaper, package printing growth, commercial print volume decline, the growth of digital color printing, cloud-based workflow solutions, and successful solutions strategies.
Newspapers continue their decline as they become a misnomer today. The content in them is not really news anymore, it’s a day old. The real news has been reported on the internet for free a day or two earlier. While it is difficult for anyone who grew up with the paper to change to an electronic version, the price difference of paper versus electronic is enough to drive even my 91 year-old father to switch. He does not enjoy electronic devices and has read the printed newspaper every day for at least 60 years. Digital printing has only caught on for newspapers with short runs, which is usually an international paper in a big city or newspapers in a remote location. The concept of a personalized newspaper has not caught on because one of the great things about a newspaper is reading stories you hadn’t thought about before. More targeted advertising will continue to be pursued and should make some progress.
Packaging printing continues to grow. Except for DVDs and CDs, products are not being replaced by electronic alternatives, so the volume of packaging and printing continues to grow. As regions like China continue to develop, the need for better packaging continues to expand. The value of digital printing remains with prototyping, test marketing, and short runs; although HP has developed some clever packaging applications for Coca Cola and Budweiser.
Graphic arts/commercial printing volumes continue to decline. There are really three main application segments within commercial printing—publishing, promotions, and business documents. The print volumes in all three are being negatively affected by alternatives. Publishing is getting a double whammy. First, the printed content is also available in electronic form. For example, eReaders have captured about 20 percent of the book volume. Consumers are also diverting their attention from reading traditionally generated content to user-generated content—primarily Facebook and YouTube.
Budget dollars for advertising or promotions are spent on media that captures eyeballs. There is no product that captures user attention like smartphones. The urgency felt by the user when a text comes in is overpowering. Many individuals never go anywhere without their phone and many have their phone with them in bed at night. Consequently, advertising dollars are flooding into social, mobile, and online media at the expense of direct mail and other printed media. And, of course, the post office is not helping by continuing to raise postal rates as volume declines—helping to create a death spiral. But it turns out that print—in combination with other media—is most effective. Advertisers will work to make print interactive with quick response codes, image recognition/augmented reality, and near field communications in an effort to derive more value from print and link messaging across multiple channels.
Business documents such as forms, annual reports, statements, and letterhead are being replaced with electronic alternatives as a cost savings. These print volumes will continue to decline.
Color digital printing is growing. While the overall volume in the graphic arts is declining, color digital printing volumes continue to grow. The first wave of offset transfer occurred thanks to the current crop of toner-based presses, which offered advantages for short runs and the unique value of personalization. The second wave of offset transfer is driven by advances in inkjet technology. Already well underway is the adoption of high-speed, continuous-feed inkjet technology for uncoated offset.
The next phase that targets the coated offset paper market is getting ready to go forward. A series of new high-speed inkjet presses that can run standard coated offset stocks are now available.
From creative to MIS to workflow automation, vendors are making their software available in the cloud. This helps printers by reducing the need for IT support and by eliminating the need for an upfront capital expenditure. The net result is that the workflow software is more affordable than ever.
The solutions strategy works. Successful printing companies will continue to focus on solutions that include a printing element. Two of the leading strategies are to focus on serving vertical markets and solutions that are data driven. They add considerable value, provide ongoing revenue streams, include higher margins services, and typically provide the best profit margins.
Commercial Print Trends
The above summary provided by Erlandson offers a look at the varied happenings within the commercial print/graphic arts. While there are some areas of clear decline, there are also bright spots—such as in packaging and digital color—that we will continue to watch in the coming year.
Next week, respected research firm I.T. Strategies delves into the world of wide format in our final installment of the Year in Review. dps