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Commentary & Analysis

FREE SPECIAL: April Print Buyer Pulse Index: Larger Buyers Show Rebound

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By WhatTheyThink Staff
Published: April 17, 2002

 



April Print Buyer Pulse Index: Larger Buyers Show Rebound

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CAP Ventures and WhatTheyThink.com have released this month’s Print Buyer Pulse. The data is compiled monthly and helps industry executives understand demand trends right from the end user.



Overall, the view from print customers is increasingly positive. Print spending levels are increasing and a growing percentage of companies expect higher levels of print spending over the next six months. The biggest improvements in print spending and outlook is coming from companies with large print budgets, the ones that appear to have been hit hardest by the 2001 recession.

Respondent Profile

Respondents to the April Print Buyer Pulse Index represented a wide range of companies by various business and demographic factors. The sample of 105 print customers included people from advertising, healthcare, retail, government, manufacturing, professional services and other key sectors.



The sample included a mix of companies by number of employees and annual print spending with a bias towards medium and large companies. Over 40% of the respondents indicated their company had 500 or more employees, and nearly 50% the respondents indicated they spend $250,000 or more per year on print. The average annual print spend per respondent was over $1,224,000.

There were respondents from all major regions in the United States with a slight bias towards the Midwest region. The actual respondents were mostly in purchasing, marketing, creative or administrative functions.


Print Spending Activity – Last Month (March)

Continued high percentage of print customers purchasing print. Average spending for the month is up substantially. Biggest increases among the biggest print customers.

The vast majority of print customers (86.5%) purchased print in March. This level of activity is consistent with the last four months.



CAP Ventures has observed over the last three months between 90% and 100% of medium to large print customers (print spending of $50,000 per year or more) purchase print in any given month. However, of small print customers (print spending of under $50,000), around 55% to 60% purchase print in any given month.

Of those companies that purchased print in March, the average spending was $106,074. For the first time in three months this figure was up. In fact, the average print spending was nearly double the print spending levels in February ($57,797) and January ($69,764). Note that the print customers in this month’s survey had a lower average annual print budget than in two of the last three months. The implication is that the increase in monthly print spending is not due to a sample with higher annual print spending, suggesting that March was a good month.



Another important observation is that the biggest increase in last month print spending was among companies with large print budgets. Companies with annual print budgets of $250,000 to $999,000 indicated they spent an average of $58,435 in March the highest level since we began tracking. Companies with annual print budget of $1 million or more indicated they spent an average of $323,804 in March, also the highest since our tracking started in December of 2001.

Companies with lower annual print spending indicated purchase levels for March that were consistent with previous months.

Print Spending Plans – This Month (April)

Consistent percentage of customers planning to purchase print this month, and average planned spending is up. The most encouraging news is that companies with big print budgets appear to be rebounding with increased levels of print spending.

For the first time in four months the percentage of companies indicating they plan to purchase print in the current month declined. However, the decline was minimal and within the margin of error for the survey. The good news is that 80%+ of print customers intend to purchase print in April.


The better news is that the average print spending planned for the current month (April) is up substantially to $80,014, nearly double from the planned spending in March. CAP Ventures observed that the largest print customers reported a major increase in planned print spending in the current month to $271,176 up from $103,800 in March and $216,773 in February.



In general, all of the other print customer size segments plan to spend about the same or slightly less in the current month compared with last month.


6 Month Outlook – Continued Improvement

Print customers’ outlook continues to improve. 41.4% of print customers expect print spending to increase over the next 6 months. Only 9.1% of print customers expect print spending to decline over the next 6 months, the lowest since our tracking.

CAP Ventures asked print customers to indicate whether they expected their print spending to increase, stay the same or decrease over the next 6 months. We followed that question by asking what percent they expect their print spending to change over the next 6 months.

The April polling of print customers indicated that 41.4% of print customers expect their print spending to increase over the next 6 months, up from 38.1% in March and 36.0% in the February poll. What was very encouraging is that only 9.1% of print customers indicated they expect their print spending to decline over the next 6 months – half the percentage from the March poll.



Print customers’ outlook for their print spending over the next 6 months is to increase a robust 3.9%. This growth expectation is consistent with the increase over the 6-month outlook that print customers have indicated in the March poll (4.9%).

CAP Ventures derived this average expected change estimate using the following formula:

Percent of print customers expecting an increase (41.4%) multiplied by the average expected increase (12.6%)

minus

Percent of print customers expecting a decrease (9.1%) multiplied by the average expected decrease (-20.8%)

equals

Average expected change in print spending over next 6 months of 3.9%.



Another important observation is that large print customer tended to have the most positive 6-month outlook. Approximately 45% of companies spending over $100,000 per year per print expect their print spending to increase over the next 6 months.

Companies with smaller annual print budgets generally expect print spending to stay about the same or increase (very few expect a decline).

Overall, the view from print customers is increasingly positive. Print spending levels are increasing and a growing percentage of companies expect higher levels of print spending over the next six months. The biggest improvements in print spending and outlook is coming from companies with large print budgets, the ones that appear to have been hit hardest by the 2001 recession.

Request more data about this survey by contacting Jeff Hayes, Research Director at CAP Ventures. jeff_hayes@capv.com



 

 

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