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Going Digital Means More than Hardware

(October 2013) posted on Fri Oct 25, 2013

Trends suggest that digital imaging helps print providers meet new customer demands, add value to existing services, and expand into new markets.


By Tim Greene

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The fact is that many print buyers, even at ad agencies, are seeking these additional types of services to sell their capabilities to the end customer. They not only want you to develop these services, but many of them also need you to because they need to bring value to their accounts. Furthermore, these types of services can be the ultimate differentiator because, let’s face it, there are lots of shops that do an excellent job of printing and fulfilling. When that is all you can do, you are not competing on an entire project, because typically there are multiple other aspects that factor in to a buying decision. Consider expanding further into finishing, assembly, and installation on the print side and into strategy, research, creative, analytics, and programming on the services side.

One other aspect of developing digital capabilities is the ability to lock up business by getting your customers to work with you through an online platform. In a recent study, we found that in certain segments, as much as 23% of wide-format digital printing is ordered online, which buyers told us would grow over the next two years.

Doing this is much more than a matter of convenience; it is a matter of strategically migrating one-off or project customers into program customers. Taking a strategic approach means analyzing what customers are buying from you and trying to gain all of the information you can about these jobs to make yourself a better strategic partner.

The one-off and project sale is welcome, of course, but the more you are able to migrate those types of sale into program sales, the more you will find that your relationship with the buyer is solidified, because they view you as a strategic partner. And, as a pleasant by-product, you will find that your profit margins for these types of clients are considerably higher. By the way, an online presence is also important, because about 20% of the wide-format-print buyers we surveyed reported that they found suppliers on the Internet.

Market expansion
Historically, companies have used digital printers to create promotional and informational graphics, but one thing we’re seeing more of is the use of digital printers for environmental—as opposed to promotional—graphics. What’s the difference? A vehicle wrap is a promotional graphic. A banner informing passers-by of a grand opening? Promotional. A printed paper that sets the ambiance within a hotel or restaurant? Environmental. A printed fabric that covers the cubicles within an office environment with a beautiful sunset scene in order to break up the monotony of an office setting? Environmental.

Latex inks and totally clear UV-curable inks make environmental applications possible. Environmental represents one of the organic growth areas within wide-format digital. The other great thing about these this type of application is that it’s promotional—not part of a company’s marketing budget. The purchase of environmental applications typically is controlled by architects, interior designers, and space planners, and their sensitivity to price is much different from that of merchandisers and marketers.

Outlook
Our research with print buyers and print-service providers indicates a healthy outlook for the digital business. The number of buyers who reported that they expect to spend more on wide-format digital printing outnumbered those that expect a decline by a ratio of about 6.5 to 1, with an average expected increase of more than 14%. The number of PSPs who expect their wide-format business volume to increase outnumbered those that expect a decrease by a ratio of 4 to 1, with an average expected growth of more than 10%.

So, as we are now in the middle of strategic-planning session for 2014 and beyond, we’re advocating going digital, because when we connect all of these findings, we get a new idea of what going digital should mean to printing organizations. Going digital once meant using a digital printer to produce the same kind of graphics that were screen printed, because there was a cost advantage for doing so. Now, we think it means that the company should use its resources to help its clients achieve their goals for revenue generation, experiential marketing, or operational efficiencies.

 

 


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