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VALUE - The Magazine for Media Production and Corporate Communication

Digital Printing and the World’s Most Beautiful Yacht

Fast, individual and networked

The print communication of the future depends entirely on the creative use and tapping the full potential of digital printing. However, not all the hurdles have been overcome yet. Digital printing enables new service concepts in the communication and media market, which are aligned along the communication value-added chain. Conception, consulting, creation, workflow management, CRM, media production, networking and logistics go hand in hand when taking full advantage of the communication potential through digital printing.    

A car manufacturer sends out an extraordinarily produced and elaborately designed mailing. The personalized letter includes a top-quality booklet. Photos are glued, important notes are pointed out with Post-its. The type looks like handwriting. The customer seems very pleased with all the care taken - at first glance. The print masterpiece looks very personalized. With a second look he realizes that it’s trying to sell him a new car. But the thing is, he had just bought a new car from the same company a few months before. Huh? Don’t they know who I am? Is this supposed to be my second car? No way! thinks the customer in anger. He’s neither married nor does he have kids or anybody else he could give the mid-class vehicle the mailing is pushing. “So why did he get the mailing? My dealer always tells me how important I am as his customer and how carefully such customers need to be treated. And now here’s a clumsy, impersonal mass-mailing, – even though it’s personalized it’s not relevant to me.” This is a typical case that shows the traps and redundancies of communication practices. Even if the mailing does arrive to the intended recipient and actually generates response, the damage is immense, since the brand incurs on damage through the mishap. Customers you anger and disappoint because you have made it look like you have personally addressed them, but have label the mailing as a mass send-out will spread their negative story around and stay away in the future without even saying goodbye. Modern communication requires that even with a large number of customers, providers (brand owners) must adapt their advertising to individual interests. The argument that advertisers and their agencies frequently do not have enough data for creating high-quality profiles for individual communication does not mean much from the customers’ or consumers’ point of view. Particularly customers who practice online communication have long known of the advantages of Permission Marketing and have no problem providing details of themselves, as long as it is clear what will be done with the personal information. The ideal case is where the customer generates and maintains his profile himself or where providers develop and update profiles using a constructive dialog. The key to success lies in a new grasp of Customer Relationship Managements. CRM must be seen as a customer-oriented company approach in order to conduct dialogs based on real interaction. This is true for all types of businesses: from the mom & pop store around the corner to SMEs and large corporations. However, it is not enough if customers understand and live this out – the service provider from the communication industry must also adopt this philosophy. Innovative print communication techniques such as digital printing thus offer new ways to shape communication via media. Through digital printing, new, interactive forms of communication are supported, which focus on communicating relevant content quickly, individually and networked. In this context, networked means significantly boosting dialog capabilities of companies through print in combination with online publishing. At the same time, this combination offers a new platform for finding out more about the customer.

Digital printing can fall back on more than 20 years of success. Ever since the invention of desktop publishing in the 80’s, digital has been able to solidly establish itself. It now covers the needs of office communication and consumers completely, who have connected millions of printers to the PCs and notebooks. Anyone who wants to print B/W or color documents they have created automatically uses the principle of digital printing. For decades now, all transaction print-outs (invoices and bank statements in the millions) have been printed digitally and increasingly in color with high resolution and, of course, individualized. The success digital printing is real. The development of technology and marketing and has created high-quality digital printing production systems on a worldwide basis. There are printing systems available at every level, just as there are hundred of substrates – from paper and cardboard, foil and plastic printing surfaces. Varnish effects, safety print, UV toner and a whole range of other specialties are all out there. Objects can now be printed in 2-D or even 3-D. This technology could still be utilized much more than it has been up to now. It is very possible that a large number of agencies simply lack adequate knowledge and the necessary acceptance of the technology for achieving holistically thought-out conceptions for networked print communication. If you look at the important contests in the communication scene, like the GWA Production Award 2006 or the Mailingtage Award, what is lacking are innovative digital printing productions, which go beyond personalization options.

Complexity waxes – knowledge wanes 

When observing how communication scenarios becoming increasingly complex in the digital era, it is easy to miss the fact that digital printing has long taken the pole position in digital media technologies. This goes for revenues (clearly in the triple-digit million area), the dynamic increase in added-value options (by up to 500%), efficiency of communication and production and future prospects on the communication services market. On markets or in sectors that profit from the benefits of direct communication, the preference toward digital printing is the greatest. A good example is the mail-order business, where flexibility and competence in all customer-relevant communication channels is what counts the most. In industries that stubbornly adhere to established practices and business models, digital printing is not yet seen as advantageous, since one cannot tap its full potential. In the media segment in newspaper or magazine publishing, digital printing does not yet play much of a role. Individualized media products are not yet offered on a very large scale. The conservative influence of the market seems to lack trust. In order to recognize the benefit of digital printing in communication, marketing and ultimately in brand management, one must clearly understand the extended functionalities for print communication. “We are experiencing the technical changes in fast motion. The PC is practically the symbol of globalization,” said finance expert Hilmar Kopper recently at an industry conference. Kopper, an institution of Deutschland AG, who has been at Deutsche Bank for over 48 years and is today Chairman of the Supervisory Board of DaimlerChrysler AG knows what he is talking about. Since 1990, he has also been deeply involved on the Board of the Xerox Corporation laying the framework for digital printing and digital document management. In his thoughts on globalization and digitalization he commented: “We must thus ask ourselves: how does a company change through technology?” In order to come to terms with the growing complexity of technologies, it makes absolute sense to refocus on the new requirements of business and society and thus rethink the established media and communication strategies in their entirety, according to Kopper. Selective perception, information overflow, the importance of personal necessities and singular interests are all factors that power communication technologies, which enable individualization and customization. For Kopper, this guarantees the success of Internet technologies and particularly digital printing – the backbone of modern banking and finance and a whole range of other business branches. 

Sins of the past

Up to now, these plausible considerations have not really been supported the way they should have been. All pertinent parties were concerned only on their own matters and situations. The supply industry, the print services and even the agencies missed out on the benefits of digital printing and never really constructively and intensively came to terms with all the changes in communication behavior associated with this. The innovation of a more than 500-year old cultural technology like printing required total rethinking. Not only do the business models change, but so does the organization of the communication and the approach in planning and creating communication campaigns, which all wish to benefit from digital printing. The dynamism of the printing and publishing innovations is daunting. Thousands of patents were developed within only one generation and hundreds of thousands of new products and applications emerged. Initially, the developers and manufacturers focused on creating good printing systems, in order to optimize printed images for industrial requirements. Digital printing products have to look like real printed products as one is familiar with from the offset or gravure world. Not an easy undertaking, since digital printing uses new types of toners, ElectroInk or other inks, which can hardly be compared with offset printing colors in their composition. Print substrates had to be adapted, since toner printing with laser technology depends highly on the effect of heat.

Digital Printing Positioning

Getting the printed image to stay on the substrate was also tricky. Late, and nearly too late, new workflow scenarios and more powerful front-ends were developed, which adequately supported printing with variable data. However, new production standards and entirely new tools had to be created for this. How this was to be executed was  highly and controversially disputed in professional circles. Many insider discussions were made public, thus confounding the customer.        

Explosive dynamism of printing and publishing innovations

The printing industry as a palladium of quality, graphic applications understood digital printing primarily as a new means of production, which would compete with offset printing. At the same time, one noticed with concern that print-run figures sank with digital printing productions. The same was true with the value of orders, which can easily drop to under €200 per printing job. The classic acquisition and production approaches of a print shop could not work. Even if printing companies recognized and learned to appreciate the benefits of digital printing, they found it tough to really earn anything from it. The result was disastrous. Digital printing – along with the New Economy crash – was quickly considered a possible flop among printers.     

Agencies didn’t warm to the idea of digital printing either. They are used to being kept up-to-date by their print service providers on all technical innovations that come up. The lack of acceptance and complexity of the innovation surge in digital printing could no longer get through using the established route. In digital printing, there are now whole new players that agencies do not have access to. IT groups like HP, IBM or imaging and document specialists like Canon, Kodak and Xerox double-digit billions together with photocopier manufactures Konica Minolta, Océ, Oki or Ricoh in digital printing. The fact is: there is no other media technology that was so heavily invested in, so quickly for research and development as in digital printing. Xerox alone invested over a billion dollars in development of the high-end digital printing system iGen3, which was launched in 2003. Agencies and their customers alike from the area of brands and communication all found themselves groping in the dark. Digital printing was categorized as only something for new print technology for the innovation of resources. Cost comparisons were then made, which fell under the cost per page principle. It was reported what a print unit costs, but not what it yields! Studies sufficiently document that the smallest cost portion (an average of less than one-sixth) is what makes the largest difference in print production. Hard cost factors such as source file creation, stock keeping, waste paper etc. were not included in the cost analysis, nor were soft factors, such as accelerated time-to-market thanks to digital printing, higher content relevance etc. A printing unit was created on the fly and made available to the recipient immediately, making communication more effective. This is where the potential for time and cost advantages through digital printing production lies, even if the printing cost per unit is higher than in mass printing, according to the conventional purchasing mentality.

We need new services

The following consideration is on the mark as well as important: digital printing enables new service concepts in the communication and media market, which are aligned along the communication value-added chain. Conception, consulting, creation, workflow management, CRM, media production, networking and logistics go hand in hand when taking full advantage of the communication potential via digital printing. It seems a paradox that the principle of digital printing goes straight to the heart of agencies, but is not implemented on a large scale for big projects. No agency can do without digital printing when visualizing its ideas and campaigns. Booklets and handouts have been digitally printed practically forever. For test purposes, digital printing is relied on, as well, as a form or pre-print-run check. To get beyond the phase of optimizing existing processes within the framework of learned communication possibilities, you can’t remain stuck on only what you are familiar with. Through the reservations – or provokingly stated, the ignorance – of printing operations and agencies about digital printing, the important challenges are not actively supported from the market and customer viewpoint. Therefore, new business remains weak and one allows others to dominate the field. Currently, new types of services, which have been developed in the Anglo American area and have earned millions in revenues within a very short period high return on investment. DME in Daytona Beach or DSI in London are good examples of modern communication service providers who have been offering extensive direct communication solutions for many years. New means of communication and methods are developed together with customers and partners from agencies.          

Study result: response rates increase by up to 500 %

Printed matter that’s easy to read and individually designed raises the communication’s success significantly. Individualized customer communication with variable data in full color produces a maximum effect as well as much higher attention. These are the most key results of an important study published at the beginning of 2006.

The study was commissioned by the imaging and technology corporation Canon and conducted by Frank Romano and David Broudy in the U.S. The response rates for direct mailings in Western Europe are around one percent. The Romano study produced even worse figures. Only around 0.45% of addressees of non-personalized, B/W mailings use the response element. You can improve and increase the response rate by 44 or 45% through personalization and the use of colors. The combination of personalization and use of full-color elements raises response rates by 135%. If database information is integrated, a rise in response rates can be achieved of a healthy 500%. 

Companies such as these are currently founding multinationally-geared service providers in continental Europe who have the goal of being intermediaries between those offering and those asking for services. The positioning is that of an information or communication broker with technologically based, top-grade expertise. One example is the Eclipse International Group (based in Belgium), which dedicates itself to Smart Communication. Digital communication is thus combined with the service of a marketing provider. The profound know-how consists of automating marketing and communication processes completely. The challenge is to optimize workflow by integrating production management and campaign controlling. For the automobile, IT, real estate or travel industries, as well as consumer goods manufacturers, effective direct communication solutions are offered, which bring together online and printing/digital printing, among others. Millions of copies can be digitally printed, individualized communication campaigns can be executed, accompanied by call centers and tracking services that show customers the Return on Communications immediately. In this way, a service provider like DME of Florida can effortlessly reach a million customers a day for dialog via digital printing. Scaling effects are no problem, since there are no limits to production capacity expansion. This is assuming that it functions and that it pays off – for both the service provider and the customer. Nevertheless, there is still no currency that provides media planners with strategically solid parameters and comparative values for campaign planning similar to the TKP (Price for Thousand Contacts) in mass communication with TV or radio. This is what the communication with digital printing is currently struggling with - much like in the early stages of online advertising. The benefits are high and evident, but some kind of system is needed to measure the success with reliable evaluate criteria. This means making digital printing standard procedure outside of its established areas of use: office communication, transaction printing and Einzelmaßnahmen im Bereich grafischer Anwendungen lower numbers of print-outs in the area of graphic design. In particular, where the expanded functionalities of digital printing are put into focus. The sense of digital printing is not clear if we compare printing with virtual printing forms directly with established printing techniques, which reproduce images and text more or less identically with printing plates. 

Digital printing opens up entirely new options, whose functionality align themselves to a fundamentally different handling of content. The individualization of the relevant content and the diverse possibilities of being able to offer not only customized content, but content the customer has assembled himself is impossible without digital printing and its related technologies for interactive workflow architectures and cross-media communication. What can be printed is what matches a specific customer or what the customer needs or wants. Communication can also have a consulting function in this context in order to identify customer wishes. The follow five evolutionary stages can be identified for the implementation and effectiveness of digital printing. At the same time, the different levels stand for a significant increase in the value of the print communication, in which digital printing no longer merely constitutes an investment, but makes the Return on Communications calculable.   

Level 1: Short-run Printing. For print-runs up to a few hundred, quickness is what counts most, from ready to print to the finished print product, which is processed and finished inline in the best case. The strength of digital printing lies in the rapid production of finished printed products, which are immediately usable due to the omission of drying times. Printed products can thus optimally demonstrate controllable communication effects.

Digital Printing Positioning
Digital printing supports the modern and future communication requirements. Source and copyright: Andreas Weber, Digital Printing Forum, Mainz

The attractiveness of short-run printing also becomes clear by the fact that contractors from the offset printing market make an effort to get the small runs thus sink the entry threshold for print-run size considerably. 

Level 2: Version Printing. The production of printed products, which follow uniform design conceptions and differ perhaps in languages versions and where smaller print runs can be made available at very short notice. Preprints are no longer necessary, since with digital printing, the image can be altered completely from print-run to print-run. Small and medium-size runs can be produced optimizing costs, as well.

Level 3: Personalized Printing. Printed products include the name and address of the addressee. Digital printing optimizes the process of this established printing form of direct marketing in practice for decades. Not only is the cover letter personalized, but also flyers, folders, brochures etc. A technical innovation enables personalization of the image. In the form of a “hybrid print production” (e.g. inkjet printing heads that are integrated in printing machines or high-performance equipment for further processing) even huge print-runs of more than 100 000 copies can also bear the names and addresses of addressees and printed, personalized, at high speed.

Level 4: Individualized Printing. Printed products are aligned in their design and selection of content to segmentations or individuals. This is known as “transaction printing” and has been around for decades, used for printing invoice documents and bank statements and are individualized to recipients. Through the latest digital printing technologies, colors and images can now be included, which increases attention and allows for the inclusion of additional marketing information.

Level 5: Customized Printing. The recipient of printed matter can assemble content using the Web and will receive a personalized, individualized printed product according to his precise wishes. He establishes his interest profile himself in this case. The entire communication and production process is completely automated. Together with practical CRM concepts, recipients who are already in the databases can also receive adapted printed products tailor-made to their profiles and special wants and needs.

A strong team: online and digital printing

As the overview of the evolutionary stages of digital printing illustrates, many common terms such as print on demand or just in time printing are misleading. Printed products are usually manufactured as the need arises and in the shortest time possible. This is true for all printing processes and printing productions, from offset to gravure. The focus must therefore always be on the functionality, which can be expanded to many stages, incrementally  thanks to Variable Data Printing, or VDP. The buzzword that became popular in 2005 at the latest, Web-to-Print has dozens of slightly different definitions. The technology-related definition characterizes Web-to-Print as the production process in which printed matter is optimized through the use of databases and online applications. With Web applications based on PDF-X/3 printing files, production processes are made simpler – for both those who order printed products and those who produce them. At the same time, sources of errors can be eliminated. For business printed matter like business cards, postcards, mailings etc. templates can be used, as well as for ad motifs, flyers and brochures for automated printing. Static or dynamic content can be printed. In autumn 2006, over one-hundred Web-to-Print software solutions were on the market. The number goes up by the day. These solutions vary considerably in their complexity and user-comfort. The marketing-oriented definition of the term Web-to-Print results in an even more attractive image. According to the definition, Web-to-Print aims at creating cross-media communication effects, which unite online communication, digital printing and CRM concepts. Content is selected online according to specific interests and configured automatically to individual printed products. This takes place via user-control or contextually. In this case, the printing communication with Web-to-Print through digital printing conforms to the requirements of the Web 2.0 era. The user determines the content he wishes to consume; he also determines directly or indirectly the way he would like to have the content presented. For advertisers, this opens up completely new possibilities. Online marketing campaigns can include context controlled print formats as a new element, which are produced on the fly, and if the customer desires, delivered right away – either for printing themselves as a PDF or per post. Market researchers assess the growth of variable data printing and individualized communication in the Web-to-Print area this year of around 26%. According to InfoTrends, $5.3 billion in revenues had already been achieved in 2004. For 2009, revenues of $16.6 billion are expected. For Europe and Germany, no figures have currently been published. It can be expected that the growth potential is higher than 26%, because the added-value volume still lies under €5 billion per year. In particular, catalog businesses in Germany strengthen the Web-to-Print communication due to expanding e-commerce strategies. One unique project currently taking place in Germany is quite noteworthy. The technology corporation Canon is developing a comprehensive concept, teaming up with a premium brand. The goal: to fully tap the benefits of digital printing. Per print and online media mix, every stage of the sales process is included, from pre-sales to sales to post-sales. This ¾- year, total Communication-Reengeneering concept is being realized with the creative experts of the agency WSP and with the interactive marketing experts of Digital Printing Forum, which also handles the project documentation. There will be nearly 40 different applications for static and dynamic content. The necessary Single-Source-Publishing concept incorporates CRM and production data. The specific needs of marketing strategies and tough requirements of the premium target-group are factored in, as well. These considerationsmust ask the question: how can the positioning and characterization of print in networked communication scenarios be carried out? Because print communication as a whole can be broken down into 3 parts. Individual process techniques in print production are given, according to different strengths and areas of deployment and have the best impact when combined:

1. Special Effect Printing (packaging, commercial printwork, circulars, inserts etc.): static, multi-sensory prepared content with high attention value, predominantly with Pull&Push marketing. 
2. Hybrid Printing (hybrid productions, which combined various printing techniques): static and dynamic content (media products, large-scale mailings, catalogs), mainly for Push marketing.
3. Variable Data Printing: printed matter of all types with dynamic, individualized, customized content (smallest and large-scale print-runs), predominantly for interactive marketing in networked communication campaigns. 

Digital printing provides a powerful growth spurt

For the future of print communication, digital printing will play a key role, due to its functionality and seamless combinability with online communication. The print communication of the future depends entirely on the creative use and tapping the full potential of digital printing. This is especially true for cross-media communication, which networks print and online. Corresponding applications are already being used in the finance and insurance areas and in some cases, the automobile sector. But these are still the exceptions. How important it is to link print and online so that the consumer and not just the marketer of advertising benefits is shown by a recent study from the UK. “The changing from traditional media to the virtual world can have a huge impact not just on the economy in the future, but on the media authorities, the public and politics. And the speed in which the young age groups change their consumer behavior is different than in other generations,” according to a spokesman of the British regulation authority Ofcom, referring to the current Ofcom study “Annual Communications Market Report” from summer 2006 (www.ofcom.org.uk). It it also possible that Europe might miss out on this. The powerful growth of digital printing will take place mainly in Asia and North America in the next 10 years, according to market researchers. In Asia, revenues of around €6.8 billion in 2005 will quintuple to €32 billion by the year 2015. In the U.S., revenues are expected to sextuple from €12 billion to €72 billion. Europe, in contrast, is expected to grow more slowly. The revenue volume with digitally printed print products in 2005 with nearly €11.6 billion was nearly the same as the U.S. and was about twice as high as Asia. With clearly under €20 billion, growth in Europe will not even double in the same period of comparison by 2015. This is the core message of the PIRA International Study

“The Future of Global Markets for Digital Printing to 2015“, compiled by R.I.T.-

Professor Emeritus Frank Romano (from July 2006). The study further expects that with revenues of around 125 billion in 2015, around 30% of printed products and the like worldwide will be printed digitally. This means volume share will triple from the current approx. 10%. The largest growth will be achieved by direct marketing. At the same time, high growth rates will also take place in the packaging and label market. The study also indicated a dramatic decrease in the number of installed classic printing machines (offset, flexo, gravure) from 1153 966 machines in 2005 to an estimated    674 064. This drop by one-half will probably be the result of two factors:                      

1. The installed offset printing systems are becoming more and more powerful; productivity is rising just as the number of publications per machine. This can cause the fall in the number of printing machines with the same rise in printing volume.
2. At Drupa 2008, some manufacturers presented printing systems which heavily attacked, if not entirely passed up classic machines due to their performance, unit cost price and printing quality. These developments have not come just by chance. Digital printing has developed slower than expected in the last ten years. This is not due to the principle of digital printing, but factors such as digital production and workflow management in the context of process optimization, availability of good customer profiles for variable data printing, mastering of Web-to-Print applications in cross-media communication etc. What should be kept in mind is that service providers’ requirements tend to change, since not only production services are purchased anymore, but entirely new products and production processes must be developed. Along with profound communications know-how, flexibility and wealth of ideas are required, which are oriented to the market and customer requirements. The better digital printing is seen as a service business (beyond click-rates or production costs), the quicker the markets will develop. This requires, however, that the service provider be prepared to change structurally in order to migrate from the production sector to the service and trade sector.

In other regions in the world, this seems to work better than in Europe. In North America and Asia, digital printing is implemented more diversely than in Germany as a motor for innovative service, in both business and brand communication. The fact is, in Europe and especially in Germany, they are still struggling with digital printing, specifically in brand communication. This is largely due to the fact that the business models of agencies do not take into account the implementation of digital printing and variable data. And most publishers refuse the option to individualize their printed product. They fear the cannibalization of their classic mass-media reach geared business. In markets such as China or the U.S., they tend to be more flexible and open to new ideas, so growth is more rapid. For Europe to catch up, digital printing and print and online communication must be bundled with communication scenarios based on efficiency. The road there is not an easy one, but it’s absolutely worth it.           

Andreas Weber

Beyond Paper: Print data become interactive!

Considerations concerning digital printing should not block the view of other innovations in the field of print. Patrick Lithander of  Plan.Net concept of Munich describes how he – as an online specialist –  deals with print data with PDFs based on his project experience so far. The PDF is digitally transformed and enriched with video and/or audio sequences in order to make applications from print and e-publishing that are accessible to anyone who uses online communication via the World Wide Web

E-publishing is not the end, but the recommencement of classical print productions. Double pages that give you more space. Advertisements that present products dynamically and from many perspectives. Contest coupons with a direct interaction. What do media producers dream of in the digital media era? No doubt about it. Digitalization and online communication have changed the world significantly. And the end of classical print production in this context was predicted a long time ago. But the continuously growing online community is, nevertheless, print. It is still irreplaceable for brand and product presentation. No piece of paper must fear for its life in spite of all the new communication challenges like quickness, interaction or multimedia capabilities. Nonetheless, the print sector should reposition itself within the increasingly integrated and networked communication. And this means not relying on the old charm, but to challenge the online competition head-on and take advantage of the opportunity. This is because print production and e-publishing connects much more as some media production people have so far thought.

E-publishing transforms print into an online format

Suppose you want to explain the complex functions of a clockwork. You can do it the classical way in graphically-linear 2D or with an acoustically commented series of photos with 3D animation effects – with moving, animated details, including the series of processes, underscored by audiovisual accentuation. Maybe include the brand’s TV  commercial and a personal video message to the target audience. Images, graphics and text of the manuscript are all presented, emotionalized and strengthened using multimedia. The navigation is page-after-page, just like any magazine. Turn the page on the screen with a simple mouse-click. At first glance, he can also activate hidden info-boxes. He will try out a whole range of product feature with great enthusiasm and finally establish contact per online for or even order a printed brochure. The producer can reply directly, since his live publication is connected to his CMS and CRM databases. So what is the role here for the media production man? He only has to produce content once and can send it out on demand at a much lower cost a million times or make it available. If any alterations must be made, it’s not necessary to reprint it, since images or prices can be updated per mouse-click. Success can be proven directly via online statistics or optimized at a later point in time, since parameters such as use, resting time and activities of the user are measurable online: all of this is not a dream, but reality. E-publishing uses printing data in a new marketing format, which makes the printing product useable via the World Wide Web. See some good examples at: www.plan-net.de

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