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Commentary & Analysis

Running Through the Year

By Noel Ward,

By WhatTheyThink Staff
Published: December 18, 2006

By Noel Ward, Executive Editor December 18, 2006 -- So here we are again at the end of one year and the cusp of a new one. Looking back over the blur that called 2006 it has been a roller coaster of departures and arrivals, briefings and deadlines, planning and projects. The count from my office tallied 51 weekly ODJ deadlines, three trade shows, eight conferences, four countries, three continents, 15 time zones, assorted speaking gigs, four video shoots, numerous projects, assorted webinars and podcasts, 46 hotel nights, 60,000 air miles, another 7,000 on the highway, 6 U-Wreck-Ems, and way too much road food. I don't think we're going to see anything remotely resembling stability until at least 2008, probably longer. I was sitting in the United Airlines Red Carpet Club in O'Hare one night, hoping the twice-delayed airplane would arrive so I could get home. In the line for veggies, fruit, and cheese and crackers a woman ahead of me remarked to a colleague, "I don't believe so many of us go through life eating like this, on the run and living on chopped celery, carrots and cheese." That's for sure. But thank all the travel gods for airline clubs. Morphing into 2007 Anyway, while all of us were running through 2006, our industry continued morphing into whatever it will become, the one thing that's sure to continue in 2007. I don't think we're going to see anything remotely resembling stability until at least 2008, probably longer. And stability will continue to be a very relative term, sort of a new normal. The ongoing merging and consolidation among vendors and print providers alike seem to be business as usual, but is showing signs of tapering off. But that may be an illusion. I let the smart people like Dr. Joe think about what it all means, while I look more at how printers are dealing with the changes and how they are adapting their businesses. The Price Point Many printers I've talked with this year to are concerned about dealing with competitors who continue to compete on price, even for supposedly "higher value" work involving variable data. The resultant commoditization is a significant problem, and with so much pressure on print buyers to get a dime for every nickel they spend, this picture is not about to get any prettier. It's always easy--if mindless--to make price your unique selling proposition. The bad news is it can cause some competitors to go under while the guys who whore the product (as they say in the car business) last for a while--usually until the numbers don't work anymore. What this sea change seems to be driving is fresh investment in equipment and software. While this is happening, and also because of it, more commercial offset shops are embracing digital print and diversifying. They are elbowing their way into direct mail, transactional print, book production and more. Direct mailers are looking to do bills and statements. Statement printers are adding direct mail. All are beginning to integrate some aspect of the Web into their business. It's turning into one big bowl of gazpacho. What, exactly, is a "printer" these days? But what this sea change seems to be driving is fresh investment in equipment and software. I have not talked with a single vendor who was displeased with Graph Expo back in October. And much of the feedback from On Demand in May and Graphics of the Americas in March was also positive. Some of it is just that many print providers are hitting the point where they need new machines and software and feel that the business climate and their business plans justify the investment. Many of the guys I've talked to say they want some of the new capabilities available and have decided it's time to pull the trigger. Since Graph Expo was something of a decision-making show vendors may see some good sales in 2007. Which would be a very good thing. And it'll be even better if those new boxes and software help print providers move the needle on profitability. Ahhh! Remember profitability? It'd be great for everyone to see a return of real profits in 2007. While they may prove elusive for some, the print providers who are most likely to enjoy them are the ones who take advantage of technology and do so with forethought, imagination and intelligence. There are three key areas to focus on in 2007: * Variable data is going to continue to expand and it is imperative that those offering it compete on value, not price. Whether the jobs are printed on small machines or large is irrelevant; what is critical is that the results are tracked and integrated into the next campaign and the next, continually offering more and more value for customers. Some of that value has to come from the integration of print and the Web, especially response URLs. There are lots of options in this space and any print provider who doesn't at least offer this option is shortchanging their customers. * Speaking of print and the Web, Web-to-print is not just a sales pitch from some Silicon Valley company. During 2007, companies with web-to-print capabilities are going to open up a lead on companies that don't. It really doesn't matter whether you adopt an ASP model, buy some software or grow your own. Web-to-print is going to become as essential as the telephone. In fact, my prediction is that by the end of 2008 you will notice a print shop that doesn't have a fairly comprehensive web-to-print program in the same way as would today if they didn't have email. Printers most likely to see more profits in 2007 are those who take advantage of technology with forethought, imagination and intelligence. * Customer service will become mission critical. As print becomes commoditized, service will be a key differentiator. There are a lot of levels to this, a lot of ways to make your business indispensable. Figure out what they are. Get inside your customers' heads and operations and service the living daylights out of them. But that all starts a couple weeks from now. And we'll be back here with you, with articles and columns, case studies and white papers, opinion and reports, blogs, video and webinars, and whatever else we conjure up to give you insights into our ever-morphing industry. Stay safe over this holiday season. Merry Christmas, Happy Hannukah, Happy New Year and all the best as you move into 2007.



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