Economics & Research Blog
Why the Post-Recession Printing Business will Be Quite Different
Believe it or not there are still print executives who think business is slow because the economy is slow.
By Dr. Joe Webb
Published: April 29, 2009
Believe it or not there are still print executives who think business is slow because the economy is slow. They ask "when will the economy get better so things can get back to normal?" Normal? Lately, "normal" has been pretty bad. I'd like to go back to the printing industry of 1997 and freeze it; or that of 1987 or 1988! Readers of these notes and my columns have a leg up on knowing that things will be quite different.
The main reason is that technological changes keep going, and they are often encouraged by slow times as information creators, disseminators, and users search for costs and methods that match their increasingly scarce resources of time and cash. Time becomes more scarce because companies downsize (10 employees at 40 hours a week is 400 hours; 8 employees is 320; just because there are 80 hours left does not mean that the same corporate functions disappear). This is one of the main reasons why printers can find some upside in outsourcing logistics (inventory & fulfillment) and deployment (mailing, e-mail services), and digital media (video, podcasts, and others).
Since the post-recession industry will be different than the industry was going into it, printers have to change their costs. This is not a hunkering down process, but a recognition that costs reflect the investment printers have made to offer certain services that were needed prior to the recession. Changing costs does not mean doing less, changing costs means making different investments targeted to what will be needed a year and three years from now. This is why investment should be as constant as possible, about the same amount in good and bad times. If it's not, printing companies often make big investments before slowdowns and miss business upturns. You want to hit upturns with the best costs possible, just as much as you want to go into downturns with the best costs possible. The information marketplace doesn't wait for printers to have new equipment or services.
The percentage of Americans who use the Internet has reached 80%
- 40% of those age 66+ go online, an increase from 29% in 2000
- The time Internet users spend online has grown in each year of the studies, and is now 17+ hours per week
- Light users spend an average of 2.8 hours per week online
- Heavy users who average 42 hours a week online
- 24% of American households have at least three computers
- The percentage of households with no computers continues to decline; only 15% do not have a computer
- Broadband is by far the dominant form of online service at home, nearly 80% of Internet users, more than double the level of five years ago, and eight times the percentage in 2000
- Access to the Internet by phone modem has dropped to 16%
- Two-thirds of home Internet users keep their broadband connection turned on most of the time while they are at home; only 20% percent do not
Just think of what these data will look like two years from now. What do printing entrepreneurs need to do to benefit from these trends rather than cowering in a corner having hunkered down hoping the 2005 printing industry comes back in 2010?
I use two trite sayings when I'm making presentations, and they get a good chuckle. The first is "ignore your competitors and stay ahead of your customers." This is the essence of marketing and the purpose of strategic planning. By staying ahead of your customers, you automatically stay ahead of your competitors.
The second one is "when business is good, everyone looks like a genius; when business is bad, you have to be one." This one has to be amended. When business is bad you have to be a genius entrepreneur. This does not mean you have to be a genius intellectual, you just need to be insightful. It often means that you have to become a master of the obvious, seeing things that are right in front of you that others are myopic about. It's not easy, but it's what print businesses need now. Are we up to the task?