Commentary & Analysis
Textbooks, Digital Printing and The Dog Food Dilemma
By Michael Josefowicz "
By WhatTheyThink Staff
Published: March 21, 2006
By Michael Josefowicz "You have to remember that the market for textbooks is like the market for dog food because purchasing decisions are not made by the ultimate consumer" - Barbara Levitt, Clifford Nass; Administrative Science Quarterly, Vol. 34, 1989 March 21, 2006 -- Printers are usually in the dog food business. They are often trapped someplace in the middle of a value chain where the money that comes in is from their customer's customer's customer. Everything except that last link of the value chain is an expense. When you are in the expense part of the system, it's much harder to add value without cutting margins. When you are in the expense part of the system, it's much harder to add value without cutting margins. Being so far away from the customer might help explain why digital and variable is still moving slower than it soon will. It's really not that different from the first 50 years after printing was invented. Guttenberg and company spent most of those years working feverishly to be as good as "handwritten manuscripts". That was the standard for those already buying output in the 1460's. But eventually small editions of portable books brought a whole new population of consumers into the picture. When print found it's new authentic voice (new for the 15th century), it changed the world. Isolated inventions don't lead to great changes unless they are part of a system that empowers people to do things that were previously impossible. Computers did the work of adding machines, typewriters and huge filing cabinets for many years. They were better ways of doing what was already being done. But when VisiCalc gave people the power of the spreadsheet, and PostScript allowed the printing of well-formatted documents in the office, the desktop revolution began in earnest. And affordable portable computing went on to change the world. In the world of 2005 digital printing, large scale 1-to-1 marketing is generating lots of movement of dollars from one part of the value chain to another. It's 20th century marketing being done much more efficiently. Isolated inventions don't lead to great changes unless they are part of a system that empowers people to do things that were previously impossible. But, based on revenue generated, does large scale personalized marketing really make sense? Getting 10 times better results is a legitimate, great success story for the marketer or marketing department. But 10 times 2 percent is still only 20 percent. And the kicker is that response is not revenue. When money spent on advertising is measured against actual revenue generated, will it continue to make sense? Successful businesses, no matter how large or small, are using data based decision making that demonstrably drives value to the top line. Will direct mail and advertising stand up to this scrutiny? As a printer, how much money do you spend on advertising or direct mail marketing? Do you think it's the smartest way to spend your money? As a consumer, how much time do you spend with advertising and direct mail? Is it the best way to spend your time? Dog food and textbooks Everyone in the textbook value chain knows the system is suboptimal. But they all are trapped by the "dog food" problem. It's a great example of "it's the process, not the people" insight that comes from Six Sigma process controls. Specifiers and buyers are in the educational bureaucracy. Their incentives and rewards are not directly tied to producing the "optimal customer experience" for students in the classroom. Yet, they make the million dollar purchasing decisions. Students, the real customers, or teachers, those closest to the customer, are given little choice in the purchase of textbooks. There is general agreement that the textbook as an educational content delivery system is either broken or much too expensive. There is general agreement that the textbook as an educational content delivery system is either broken or much too expensive. On top of that, the legacy systems for specifying, writing, printing, distributing, and purchasing, textbooks are inefficient. Their very complexity makes the potential risk of making a radical change very high for everyone. At this scale, only a demonstrably better system, one that is tested and proven in the real world of day-to-day practice will lead to real change, But when it does, it could happen fast. For a while, technology enthusiasts were sure that e-delivery and e-learning were the answer. Store all the educational content in an XML database, slice, dice and package as necessary, control digital rights, of course, and send to laptop computers or e-book readers. At the time, any opposition was ascribed to organizational inertia and lack of vision. But, the educational community understands something that the advertising and technology communities don't. Advertisers can identify their best customers and figure out the best way to talk to them. Public education and government don't have that luxury. They are mandated to serve everyone. Advertisers can identify their best customers and figure out the best way to talk to them. Public education and government don't have that luxury. When you have to serve everyone, if the content delivery system doesn't include print, it just doesn't work. This is not because educators are backward, but because when you spend time on the ground, you truly understand the value of print. (Just as retailers today understand it). Until just recently, there was no practical way for the content delivery system to include design quality printed output. But now, it is starting to change. UDPP - Print Output is the Enabling Technology UDPP is my acronym for the Ubiquitous Digital Print Platform. As of this writing, it's probably best represented by the line of Xerox output devices from the desktop to digital production press. But as Canon, HP, KonicaMinolta, NexPress, Océ, and Ricoh continue to deliver devices at various price points and functionalities, it will evolve into a standards-based network output platform. A recent article in ODJ describes a major investment by the Lincoln, Nebraska school district. They have purchased an integrated input/output system spread over 53 schools. It's a good example of what a UBPP might look like. Once it is connected to a standard-based network of "print for pay" providers, the platform is complete. Probably only the most forward-looking school districts in the nation will be able to make the investment made by the Lincoln, Nebraska. But many more could use a hybrid system, integrating some in-house printing and print-for-pay work with local commercial partners. On the commercial side, the islands of innovation are emerging. But for the most part, they are trapped in individual companies. Fedex/Kinko is probably the leading player in enterprise-wide collateral pulled from the network and output where appropriate. But the potential reach of a standards-based output platform will dwarf the capabilities of any one company. The New Print Experience in K-12 Education A classroom teacher, a curriculum coordinator, department head or school principal will be able to select exactly the right combination and presentation of content for a specific class room situation. Given the time constraints, it's probable that many will prefer to choose from an edited selection of appropriate material for different situations. The potential reach of a standards-based output platform will dwarf the capabilities of any one company. That content will then be delivered as appropriate. It might be to a $100 laptop, or maybe to an inexpensive e-book reader. It might be to a teacher's computer to use for a class presentation. But in any case, it will also be available in print. Whether it's printed in the building, in the district, or in the commercial world, will be irrelevant to the user --as long as it's the right product, at the right time, for the right person, at the right price. The new authentic voice of print is emerging. And it's not merely to do what we've already done better, faster and cheaper. The UDPP enables a completely different experience of Print. Embedded in the other digital information systems, it makes possible what every customer has always wanted, but is only now available: " I want what I want, when I want it, in a form that I want, at a price that I think is fair." And the world will change again.