Written by:
Howard Fenton
Senior Technology Consultant
NAPL

Did you read the press release announcing that nearly 75% of printers agreed that “Graphic communications providers will go out of business if they offer only print and distribution.” Xerox partnered with GMC Analytics to survey the Xerox Premier Partners Global Network and 718 printers responded. The Xerox Premier Partners is an international network of companies offering digital services, with 730 members in 48 countries on six continents.

Consistent with the four prior surveys, direct mail was the top cited application for generating new revenue (39 percent). Other applications (apps) ranked as follows:

  • book publishing—23 percent,
  • packaging—16 percent, and
  • photo specialty products and TransPromo—13 percent each.

Graphic communication customers are especially interested in full-color variable data printing (increased interest reported by 75 percent), followed by web-to-print services (59 percent) and marketing consulting (47 percent).

According to the On-Demand Expo e-newsletter (May 2011), variable data printing is mainly used for direct mail marketing, customer relationship management, advertising, invoicing and applying addressing on self mailers, brochures or postcard campaigns. This means that our research on the growth in VDP is consistent with the growth seen in direct mail.

In the NAPL 2011 State of the Industry (SOI) research, variable data printing (VDP) was the top answer and its importance has been increasing. Compared to the 2006 SOI we find two interesting changes in the rankings. In our research, VDP remains the most valued service, while web-to-print services has evolved into second place.

  2006 SOI Ranking 2010 SOI Ranking
VDP 57% #1 65% #1
Web-to-Print 19% #9 41% #2

While direct mail and VDP remain great sales opportunities that can also improve profitability, it’s important to recognize that there are still lingering concerns about the industry. In the Xerox research, sixty-nine percent believed the impact of the recession is making investments in other services difficult.

 Specifically the respondents site the greatest challenges to business success as:

  • differentiating the business—67 percent,
  • establishing new services—65 percent,
  • meeting demand without sacrificing quality—59 percent, and
  • current economic climate—45 percent.

What is your experience? Is your growth tied to certain apps and digital services or something else?

Howard Fenton is a Senior Technology Consultant at NAPL. Howie advises commercial printers, in-plants, and manufacturers on workflow management, operations, digital services, and customer research. He is a paid contributor to this blog.