Beyond Print: Opportunities in Expanded Revenue Streams

It’s time to evolve beyond print. With a proliferation of communication channels available – including email and social media – consumers have more choices than every before. As a print service provider, your challenge is to find new ways to support your customers’ efforts to take advantage of technologies that engage these consumers via multi-channel marketing communications.

Find out more in this Webinar by Chris Taylor, Ricoh Americas.

Printed books still have a great story to tell

 

Digital books long v2

If you travel on trains and buses packed with commuters staring at mobile devices rather than books, or look at the high streets with very few bookshops, you might think the book publishing and printing industry was in a sorry state.  Certainly this market is in a period of transition, but there is still life left yet and in particular a massive opportunity for digitally printed books.

Predictions from Nielsen research had e-books overtaking sales of printed books in 2014, with total sales expected to rise to 47 million units. This would put total e-book sales 300,000 ahead of their print equivalents and mean that electronic books accounted for 48% of the overall fiction market. However predictions based on historic data show a more mixed picture for publishers. Sales of e-books fell for the third consecutive month in April 2013, so it appears that the days of double or even triple digit growth for the market might now be gone, with e-book sales growing by only 5% to $393.6 million in the first quarter of 2013. E-book sales look set to take just under half of the total fiction market in the UK and more than a fifth (22%) of the overall UK book market, according to recent Bowker Market Research.

How is the digital revolution affecting the printed book market?

The Publishers’ Association annual statistical digest seems to paint a different picture. The industry had a record year for sales in 2013 up 4% to £3.3bn. The physical printed book is under threat from all those Kindles, Kobos and Nooks, but reports of its demise may be premature. A total of £1.416bn was spent on paperbacks and hardbacks in the 52-week period up to 28 December, according to Nielsen BookScan data, however the total number of printed books sold dropped – falling 9.8% to 183.9 million.

Despite the overall market slump, Nielsen data showed that the average selling price of a book reached a nine-year high, rising 21p to £7.70. In some genres, notably children’s books, sales actually rose. The figures also show that the pace at which we’re switching from physical to digital books varies according to the type of title. Apparently, 26% of fiction sales are digital, whereas for non-fiction books the figure is just 5%, and for children’s titles, 3%.

Why? Well perhaps for fiction it is only the words that matter, and they can be rendered as well or better in digital form, whereas for something like a glossy cookery book or an illustrated children’s book, the physical object still delivers a much better and more practical experience.

The continued growth of the digital e-book market is in part responsible for the large drop in printed book sales. Recent consumer data figures showed more than two million UK users joined the digital book market in the first nine months of 2013. However, the Bookseller said the fall in value of the book market was also due to the slowdown in sales of EL James’s Fifty Shades novels. In 2012, the author’s trilogy sold in record-breaking numbers. At its peak, the series accounted for almost half of all novels bought in the UK. James’s sales for 2013 totaling £1.4m, compared to £47.3m in 2012, when the trilogy sold 10.5 million copies. This demonstrates how overall statistics can be misleading and how important runaway success titles are to a publishers bottom line. In the rapid shift to e-readers, publishing seems to be weathering the digital climate change better than some other media industries.

As for authors each digital sale earns them a few pennies more than the royalty from a physical book sale purchase. Still, neither publishers nor authors seem to have seen their incomes damaged significantly by either piracy or the wider digital revolution.

For bookshops the news is not so good. Independent Book Shops, continue to close as readers turn to online giants like Amazon for both physical and digital books. Meanwhile, UK supermarket chain Sainsbury’s has announced it is to stop selling printed books online, they see the future online opportunity in digital products only, with physical music, books, games and films sold only in stores. Because of this trend, readers, have a wider choice, and perhaps the prospect of lower priced books.

Trends in Self-publishing are creating new printing opportunities

The number of self-published books produced annually in the U.S. has nearly tripled, growing 287% since 2006, with 235,625 print and e titles released in 2011, according to analysis of data from Bowker. The research found that while production increases are occurring in both print and e-book formats, the latter is driving the greatest percentage gains. It also shows that while self-publishing may seem like a cottage industry, it is dominated by large firms that offer publishing services to individual authors. According to Bowker in 2011 self-published printed books represented about 43% of that year’s total traditional print output. While print accounts for 63% of self-published books, e-books are gaining fast. E-book production in 2011 was 87,201, up 129% over 2006, compared to print, which only grew 33% in the same period.

While self-publishing is a DIY model, its infrastructure is made up of a handful of large players like CreateSpace, Lulu, Author Solutions and Smashwords. However the category for publishers who have produced 10 or fewer books accounted for 34,107 self-published titles of which only 21,256 were printed. Printed copies in this category grew by 74% between 2006 and 2012.

Self-published authors can sell their e-books on Amazon’s international sites when they use KDP (Kindle Direct Publishing). When authors upload those books to Amazon’s free print publishing tool, CreateSpace, Amazon will distribute the books to Amazon.co.uk, Amazon.de, Amazon.fr, Amazon.es and Amazon.it. When consumers in those countries (or in the U.S.) order a CreateSpace book, Amazon prints it on demand and the books are available for same-day shipping. Using CreateSpace is free, but an author’s royalty payment depends on factors like page count and color.

How is digital print adapting to changes in book publishing?

The ability to self-publish and digitally print on demand via web to print systems and digital storefronts has opened up a new world of opportunity to the SME commercial printer

The ability to self-publish and digitally print on demand via web to print systems and digital storefronts has opened up a new world of opportunity to the SME commercial printer. Social media platforms and viral marketing have enabled printers to find new audiences in B2B and B2C markets, allowing them to sell new services like personalised books. Linking this opportunity to new sales and marketing activities is creating big opportunities in previously untapped markets like corporate events, special interest niches, hobbies and local audiences like cat and dog shows, Women’s Institute groups and sports clubs.

For print providers the book market is expected to show the biggest gain in page share, experiencing a compound annual growth rate of 14.2% between 2010 and 2015, accounting for over 45 billion pages in 2015. Due to the inventory cost and waste associated with traditional offset production for books, digital has now become a major force in publishing. If we consider the Digital Value v Volume Proposition we can see that compared to digital other traditional printing processes have become much more commoditized.

Technology Page Volume compared to digital Value compared to digital
Coldset 362 times 2.7
Heatset 42 times 5
Gravure 4 times .5
Sheetfed 2.3 times 1.7

Smithers Pira Projections to 2015 based on pages produced and value generated.

Looking at the total print area of book pages printed, we can see that 63% of the market relates to production runs of over 5,000 which will be most economically produced by offset. If we compare this to the actual number of jobs produced, we can see that 79% of jobs fall into a category of production volumes under 5,000, which is better suited to digital production. When we factor in the advantages of printing on demand, it is apparent why there is such growth potential for digital in the future.

Both Inkjet and toner digital printing have already begun to displace offset printing of books, and this change will surely accelerate. The rationale is simple. More efficient technology and comparative quality will be the drivers for rapid growth. These days it is almost impossible to tell whether a book has been printed on an offset machine or a digital one. However the main driver for change is all about economics. Estimating the demand for books, and therefore the print run required has always been a guessing game, which has meant the publishing supply chain has been exceedingly wasteful, with at least 30% of books returned to the publisher as unsold.

Publishers and authors are responding to digital printing

In the face of uncertainty, publishers are beginning to embrace digital because it enables shorter runs. Shorter runs reduce the amount of unsold books, reduce storage costs, allow reprinting in smaller batches, and offer the opportunity to print specialty books for niche markets, including self-published books. There is much confusion about how consumers want their content delivered, but digital printing offers a flexible solution to provide what the publisher needs, when they need it, where they need it, and in the quantity required. Publishers now understand the digital value proposition, and the returns that can be generated.

Digital printing technology offers publishers:

  • Risk reduction: demand is difficult to forecast, but high-speed inkjet and electrophotographic technologies enable the economical production of books in small quantities. Publishers can monitor the demand and order only what is required to eliminate warehousing and return costs.
  • Cycle time for on demand: a number of highly sophisticated on-demand printers are able to turn orders around within 24 hours. Publishers can quickly react to market demands for printed books.
  • Specialty books and fresh content: everyone has a story to tell. Digital printing eliminates the minimum quantity requirements and enables the printing of books in very low quantities. Furthermore, every page that is digitally printed can be unique.
  • Digital printing opens up creative opportunities for in-line customisation, personalisation, and real-time marketing activities such as cross-selling or promotional material inclusion.
  • Bottom line business results: by following the demand curve more closely and minimizing warehousing and returns costs, publishers can have greater inventory turnover and improved profitability.

 Digital Printers are adding value with:

  •  Fast track order management: taking a customer’s order with a print file and seamlessly processing it, this usually requires integration with the Internet for speed and 24/7 accessibility.
  •  Exponential increase in SKUs : printing digitally on demand and leveraging the long tail creates enormous volumes of low run products.
  • Real-time scheduling and customer updates: in order to provide world class customer service scheduling and information must be instant and transparent.
  • Same day assembly of components: turnaround expectations from internet purchases are on average 48 hours, which means that print production and finishing usually has to be completed within 24 hours.
  • Direct shipping to last-minute destinations : as the print provider is now dealing direct with the end user it is essential that he provides a service for packing and distribution. This is a critical area for focus as this part of the business can be more time consuming and costly than the production of the book itself.
  • Rethink:  equipment, process flow, shopfloor management, systems, performance metrics – Compared to a standard print production environment, the workflow and management systems have to be totally automated and provide real time feedback on scheduling and performance metrics.

 Summary

We are always hearing about the demise of printed books in favour of electronic copies and the sustainability arguments about print being harmful to the environment due to deforestation balanced against the negativity of energy consumption from electronic devices. Today’s reality is that consumers can now choose how they want to be communicated with and can decide on the most convenient channel and medium, which is often a combination of both hard copy and a digital file.

Neil Falconer -Print Industry Strategy Consultant and MD of Printfuture.com

Neil Falconer -Print Industry Strategy Consultant and MD of Printfuture.com

The consequence of choice and multi-channel consumption is that printed books will co-exist with their electronic counterparts for many decades to come. Ultimately it is the responsibility of the retailers, publishers and printers to make sure that books are manufactured and sold through the most environmentally sustainable supply chain possible and that is inevitably going to include, offset printing, digital printing and electronic formats.

This article was commissioned by Ricoh to bring you independent opinions from industry experts. We hope you find our guest speaker’s views interesting and stimulating. We would appreciate your feedback.

For more information see:  Ricoh-europe.com/printandbeyond

Educating the Education Sector: The Future of Print

Speed of change Education

Across Europe there is a drive to strengthen higher education to create leading-edge facilities and services that enable remote learning and ensure finite resources are used more efficiently. In fact, in new research from the Economist Intelligence Unit sponsored by Ricoh Europe, it was found that 98 per cent of Education leaders in Europe revealed that they are now under pressure to change faster, more than they have, in the past three years.

Separately, the European Commission projected that 414 million students, worldwide, are expected to be enrolled in higher education by 2030. And even more, across Europe specifically it’s estimated that 90 per cent of jobs will require digital skills in the near future[1]. It is easy, when looking at these powerful data points, to understand why there is increased pressure on leaders to adapt their operations and training systems as quickly as possible.

If we consider higher education establishments, they must address how to stay attractive to prospective students while competing with other similarly ranked institutions, as well as with Massive Open Online Courses (MOOCs). Ensuring a modernised environment is essential. Technology itself will play a part; however, the real route to success is by ensuring the back office operations are optimised.

European leaders within the sector agree. The EIU research, The Challenge of Speed, asked respondents to identify areas where adapting to change was most crucial, and most cited responses were back office related. First is improving core business processes (44 per cent) followed by recruiting new staff (42 per cent) and adopting new technologies (40 per cent).

Now is the time for the print room to shine and be a central point to optimise core business processes. For example, targeted communication is one highly effective way of attracting new students and making a positive first impression. This can range from customised prospectuses specifically for each student, created via an online form, to multichannel communications. Based on the registration of their interests, potential students can receive tailored information about their preferred course, information about where they can pursue their hobbies or even learn about the best entertainment venues based on their favourite music.

The information gathered can also be used for broader communication such as integrated campaigns and direct e-shots, or even facilitate impromptu communication that is related to topical situation or updates on course information, all of which will add to build lasting relationships with the students.

Educational establishments can also streamline their print requirements through software that simplifies the dissemination of information on demand. Moore says, “Instead of lecturers printing course notes themselves, they can order online what they require for the next day, upload supporting content to an online portal or send students the link for them to download to their tablet or other mobile device. Relevant information or publications can be provided on a ‘just in time’ basis in a highly efficient and cost effective way and lecturers can use their saved time on meeting the learning needs of their students.

So what is holding them back?  Education leaders said the top two bottlenecks to achieving greater agility are difficulty in getting employees, business units, or functions to adopt a common approach (44 per cent) and bureaucratic decision making processes (35 per cent).

A smooth, quick and responsive line of communication can address these issues. For example the back office administration can be linked to various data sources for easy and timely invoicing or other mandatory documents. A web portal can also be created for the simple sharing of information and as a way to communicate university news and updates more effectively.

Efficient business process communication, all-round streamlining of operations and addressing bottlenecks via multichannel communications, from print to mobile devices and augmented reality, will ensure operational wide improvements. This approach to multi-communication has far-reaching effects from speeding up information for students to smoother, more effective back office operation. As a result, the corporate print room can transform into a communication centre driving efficiencies and being instrumental in introducing a number of different formats and channels that streamline information flow.

Graham Moore -business development director for Ricoh Europe

Graham Moore -Director Business Development, Ricoh Europe

With this full service system in place, the print room will not only be able to support educational establishments as they rapidly change, but will have an active role in enabling this change. The truly developed print room can speed up the pace at which schools develop through improved critical communications, management of data, and even decision making through enhanced visibility of information. In this new era of digital transformation, the print room can truly take centre stage as not only the enabler but a driver of change in the education sector.

Sources:

[1] European Commission Education and Training http://ec.europa.eu/education/policy/strategic-framework/education-technology.htm

Ricoh Infographic – the power of Direct Mail

Direct mail is a vital node in the ‘connected world’ we live in. It’s a powerful medium. People like it. Respond to it. Act on it. In a blended campaign, Direct Mail creates an impact that’s more effective than digital marketing alone. In fact, in 2013, Central Mailing Services figures showed that nearly half the UK population responded to traditionally printed direct mail over the past year. Below are the seven reasons why integrating Direct Mail into your next campaign will help you market most effectively today and for many years to come.

  1.  The Mail moment – Consumers regard personalised direct mail as the trusted medium for customer communication
  2. Make People Act – 79% of consumers react to direct mail immediately
  3. The Sensory Experience – Direct Mail has a long shelf life – two thirds of consumers keep their mail
  4. Precision Targeting – top three reasons why people open mail:  contact from known brands and companies (51%), Personally
    addressed (47%), information about products or services of interest 40%
  5. Get creative – structural dimensional mail can have 20 times the penetrating power of flat direct mail
  6. Fantastic ROI –  most important more often than any other touchpoint in the consumer’s purchasing process
  7. Effectiveness – 48% of UK adults have done something in the last 12 months as result of mailing
The Power of Direct Mail

The Power of Direct Mail

 

Ricoh Direct Mail Infographic (PDF)

Find out more about Ricoh’s Solutions for Direct Mail

More statistics about Direct Mail – see: http://www.centralmailing.co.uk/

 

What the Lessons Learned in Transactional Workflows Have to Teach Book Printers

Duncan Newton, Commercial Print Product Marketing Consultant, Ricoh USA

Duncan Newton, Commercial Print Product Marketing Consultant, Ricoh USA

I once worked with a man who said he wasn’t going to anymore Lessons Learned meetings until someone learned a lesson. He was being facetious, but there was an element of truth to what he said.

Too often we overlook solutions that are developed in another discipline because we don’t believe they have any application to our specific business.

Digital book production is just such a case. When books started to be produced digitally there were no established workflows that met the needs of the printers. Prinergy, Apogee, Prinect, and even Rampage, all were built around traditional offset production systems. Their focus was on scheduling, making film, burning plates, make-ready, creating imposition schemes, signature folding, binding, trimming, etc. And, for the last 10+ years they were driven by PostScript or PDF file structures. To adapt/adopt, many digital printers resorted to homegrown systems that were built in pieces, difficult to support and still not quite what they needed.

The chief difference between offset and digital is that digital printers produce pages in sequential order. In other words, when the last signature or stacked book block is delivered from the cutter/stacker it’s ready for binding without any further operations required. The first book is ready for binding in just the time it takes to print it.

During the reign of the toner-based continuous feed presses, the easiest way to make books was to bypass the process of signature folding. Rolls of paper went in, the books were printed 2- or 3-up, slit into ribbons, cut and stacked into offset book blocks. These book blocks were put directly into a binder and then into a trimmer. Early digital book printers invented a market for extremely short-run book production where none had existed before. Fleets of toner printers have expanded from just a few machines in one shop to dozens stationed all over the world. Their internal workflow systems were 100 percent home grown and most remain essentially the same to this day.

The Tools necessary for 21st-century communications

“The ADF architecture is the foundation for numerous applications of personalized variable data printing.”

Meanwhile, the transactional printers were doing something completely different…or so it seems from the outside looking in. In 1984 IBM invented the Intelligent Printer Data Stream™ (IPDS™) architecture that still drives almost every phone bill, credit card statement, insurance explanation of benefit (EOB) and bank statement in the world. In 1996 the Gartner Group developed the concept of an automated document factory (ADF) which was built around the core capabilities of IPDS. The original ADF concept was broken down into four modules with the first three focused on the data being received into the system and managing it all the way through from production to delivery. The fourth module was a bidirectional communication control that sat on top of the other three modules and addressed the needs of management for various reports about the operation of the factory:

  • Input—all the data and the instructions that are needed to transform the data into documents processed in the ADF.
  • Transformation and integrated output – the data and instructions are joined, and the documents are produced in the appropriate media.
  • Delivery preparation—documents are prepared for delivery to the recipient.
  • Control and reporting—manages production aspects of the ADF.

The structure was later expanded to include:

  • Document design and content integration—designers and design tools were integrated with operations management and ariable data printing tools.
  • Response management—consisting of integrated response analytics.

The elegance of the ADF architecture wasn’t in the modules but rather in the interfaces that connected them.

Print and mail facilities had to be able to efficiently produce huge volumes of personalized  communications. The ADF model gave technology providers and print service providers the framework for developing and implementing the architectures and tools necessary for 21st-century communications.

The ADF architecture is the foundation for numerous applications of personalized variable data printing. Printing companies with an ADF in place are able to smoothly compile, print, mail/ship and analyze a wide range of marketing and transactional communications including CRMbased printing and TransPromo messaging.

Madison Advisors also noted that ADF handles more than just document production. “ADF now includes data management, content management and integration, color management, and document composition functions previously found upstream1.”

But what has this got to do with a PDF workflow for making books?

Everything!

Since the acquisition of the former IBM Printing Systems Division, Ricoh has continued to expand the functionality of its software suite to match an expanding set of requirements from print providers that are not doing transactional work. With the introduction of RICOH ProcessDirector, the expansion has become even more powerful and includes a list of capabilities that printers would see as exactly what they need:

  • Automated print management with scalable workflow control functions
  • Graphical workflow builder that allows you to easily apply business rules and logic
  • Optional PDF Mailroom Integrity Feature, which provides document-level control of PDF jobs and 100 percent closed loop reprint automation of PDF files without any further transforms
  • The InfoPrint Ink Suite, which can deliver quick results in ROI by optimizing files for color, automating ink usage estimates and integrating with your Enfocus PitStop server
  • A database-driven process engine with an extensible backbone for process management
  • An embedded IBM® DB2® database, a Print Services Facility print driver and a built-in AFP and PDF viewer
  • Precise management of document reprints from within your print centers
  • Ability to start small and grow as your requirements change

Each and every one of these capabilities can find a home in a dedicated book production facility or commercial print-for-pay shop. The more complex the shop, the more these capabilities become central to a successful production environment. When all these elements are put under one system’s control, themanagement of the company gains many advantages that will make their entire operation more efficient and better equipped to meet tight SLAs.

As a book printer’s business expands, the system is ready. Its open architecture is designed to be extensible to span the total production environment. Adding features like color management, imposition, or digital asset management is easy. The system is so flexible that printers do not have to abandon any of the productivity tools with which they are familiar.

Solutions for Book Printers

“As a book printer’s business expands, the system is ready.”

Plus, the entire framework is in a constant state of review and upgrade by a group of more than 50 engineers and system architects. Ricoh development is driven 100 percent by customer requirements and direct involvement in customers’ shops. These teams work in concert with customers and push themselves to create progressively better systems. Ricoh is committed to providing commercial printers and book printers with alternative solutions that support open industry standards and connections to key production print technologies across vendors. This is seen in the on-going strategy of Ricoh to make substantial investments in companies like PTI Marketing Technologies and Avanti Computer Systems, which have complementary systems.

PTI Marketing Technologies is a leading provider of webto-print and marketing personalization solutions for both enterprise users and print service providers. Together, Ricoh and PTI are bringing new technologies, software and services to market. This enables companies to drive relevant, multichannel marketing campaigns at global, regional and local levels.

Avanti’s core technologies are uniquely positioned to complement Ricoh’s offerings with advanced solutions for mixed environments with wide format, digital cutsheet, continuous feed printers, offset, and fulfillment and kitting operations.

RICOH TotalFlow Cadence for Publishing was developed around the capabilities described above, with a few significant changes designed specifically for a shortrun digital book production environment. It allows

book printers to sort and optimize books with different characteristics automatically while taking advantage of a true automated document factory.

So…what can book printers learn from a transactional workflow?

Everything!

For more insights from Ricoh see;  ricoh-europe.com/printandbeyond

Sources:

1 www.dpsmagazine.com/content/ContentCT.asp?P=417

Line of books

A fast response to change: transforming supertankers into speedboats

Speed supertanker

How quickly can your corporate clients respond to change? According to new Economist Intelligence Unit research sponsored by Ricoh, many European businesses are overconfident about the true speed at which their organisations are changing to be ready for the future.  The Challenge of Speed report found business leaders are three times as likely to compare their company to a speedboat (48 per cent) than a supertanker (17 per cent), while believing the opposite of their competitors.  Yet the survey’s data shows little justification for this self-perception.

Interestingly the report states that 92 per cent of respondents report that speed is part of their culture. However, three-quarters are, in fact, not reacting to changes fast enough, and just 24 per cent are able to rapidly take advantage of new opportunities or adapt to the unexpected.The reality is that progress is stalled by the triple challenges of a rapidly evolving workforce, technology-led disruption and the deployment of underlying core business processes that ensure that change is sustainable.

Where the speediest companies excel is in product and service innovation, adoption of new technology and business process change – although very few companies can check all three boxes, with only one in three (29 per cent) able to rapidly re-engineer processes to support change.

What does this mean for you? There are many ways print services providers can work with their clients to support the digital transformation that is key to their successful future. First, professional print businesses can turn their attention to the efficiency of their own organisations and the speed at which they themselves can adapt to change.  A natural starting point is infrastructure and workflow. And a lean and automated system can deliver an immediate benefit in terms of flexibility and productivity while bringing down lead and turnaround times too. This means that print services providers can more rapidly adjust to changing market needs, and they can also help their clients do the same by passing along speed and productivity benefits they have achieved within their own operations.

 

The report points out that “companies need to find ways to unlearn the habits of the past and test what will work in the new environment.” This applies equally to the professional print production community that serves the needs of business. One means of unlearning habits and more quickly adapting to change is to lever relationships with trusted suppliers. This allows print services providers to benefit from the knowledge these suppliers can offer and also ensures that they stay current with both market trends and the availability of the new and revised solutions required to be a speedboat. For example, taking advantage of software developments can facilitate the data analysis that helps companies understand where improvements in their understanding of their customers can be made. The adoption of faster, more flexible hardware solutions helps expand service portfolios. And the use of precision marketing and cross media marketing communication for more targeted campaigns and responsive results for the benefit of the client – and the printing company as well – will generate greater return on investment for both. It is crucial that today’s print-based businesses not only offer speedy services to help clients themselves be speed boats rather than supertankers, but they must also incorporate value-added services beyond print that will help clients accelerate their business processes even more. A good example of this is precision marketing techniques that not only enable faster and more targeted communication with customers and prospects but improve the relevance and quality of those communications, boosting response rates and strengthening customer relationships.

The study also drives home the importance of examining business processes holistically, for both printers and their clients. Not only do you need to have seamless, easy-to-use customer-facing web to print mechanisms for entering jobs into your production stream, but that work must then be moved on efficiently to the rest of the production process. Companies that do not align their entire business holistically around the client and optimise processes accordingly will face the pressure of coping with a two-speed business.  While a focus on the client is critical, it is not particularly effective if the print services provider’s own operation is not adapting rapidly enough to market change.

Improved business practices for both printers and their clients create immediately tangible results and increase the speed of business. This includes removal of bottlenecks and the reshaping of client relationships to ensure organisational agility for both. Collectively, these actions put speed firmly at the centre of a print services provider’s operational culture and create a more conducive environment for cultivating future change — as well as positioning them to better serve clients who are facing the same challenges.

Graham Moore -business development director for Ricoh Europe

Graham Moore -Director Business Development, Ricoh Europe

Keep in mind that the pursuit of speed and agility for their own sake can be dangerous. But the risks are better managed by getting the basics right, not by slowing down. Slowing down presents the greatest risk of all.

 

For more insights into the challenge of speed facing European organisations, visit: www.ricoh-europe.com/thoughtleadership

Direct Mail is Competing in a Digital World

[GUEST BLOG]

You might be forgiven for thinking that direct mail is old hat and that with social media, SMS and email it can’t compete effectively. Well think again – in the same way that television and Kindles haven’t killed the book, email and SMS for marketing it doesn’t mean that direct mail is destined to be the poor relation. Granted technology is constantly changing and it’s easy to think that the more traditional communication methods have become unfashionable amongst the wealth of new apps and tools available.

Direct Mail delivers significant ROI

In 2013 Central Mailing Services statistics showed that 48% of the UK population responded to direct mail over the past year. It also showed that 62% of people like to receive offers via mail and 56% of people welcome mail that provides useful information. So we all still respond well to direct mail when it is made relevant and targeted to us.

Although the prognosis for direct mail is better than most people would imagine email direct marketing is still a significant force. According to a panel of 128 senior B2B and B2C client-side email marketers interviewed for the British Direct Mail Association’s annual national client email report, 56% expect to see increased marketing budget allocation to email in 2014. Optimism for the channel’s outlook this year has been underpinned by a 16% leap in average ROI from £21.48 in 2012 to nearly £25 (£24.93) in 2013 for every £1 spent on email campaigns. This rises to an average of £30.52 for B2C campaigns.

This rise in ROI has been attributed to a heightened focus on better-targeted campaigns. There has been a strong emphasis on list segmentation as the percentage of marketers segmenting campaigns for six+ audiences rose from 29% in 2011 to 38% in 2013. Segmented emails accounted for 60% of all email revenue in 2013, compared to 55% in 2012. Increased social media activity has also made a big impact on email ROI as it has increased levels of brand engagement with consumers and helped to drive a rise in the acquisition of new email addresses.

We currently live in a world of time-starved people and most of us suffer from email overload and many messages are not opened and are condemned directly to the rubbish bin. With 300 billion messages sent each day, and a constant bombardment of marketing email after email, it makes a welcome change to receive a creative and relevant piece of direct mail when you get home. In fact, if it has some novelty value, it may well be kept and shared and it will certainly stand out from the mass of boring emails. With digital printing becoming more attractive in terms of cost effective volumes and personalised messaging, it is possible to send out something a little different from your competitors without blowing the over stretched marketing budget. Printed direct mail is now becoming so effective that its ROI has increased every year in the last decade.

The future is Omnichannel

A Direct Marketing Association study in 2013 showed that the response rate for direct mail to an existing customer averages 3.4% compared to 0.12% for email. So the next big thing for print providers is hybrid direct mail or Omnichannel – a combination of printed direct mail and online interaction through email, SMS, social media –  and all relevant channels.

Printed direct mail is now a good way to drive digital interaction and as a result digital marketing is now creating innovative solutions for printed DM. It appears that the future may well be a mutually beneficial alliance as opposed to a fight to the death.

Source: InfoTrends

Source: InfoTrends

Research from InfoTrends supports this theory that, when print is successfully combined with other communication channels into a campaign,  response rates are significantly higher.

Being creative with direct mail design and format can easily drive much improved results. The use of structural dimensional mail pieces has become very popular, making it much more eye catching and appealing than a flat piece of paper. Research has shown that dimensional mail:

  • Can have 20 times the penetrating power of flat direct mail
  • Can boost response rates by as much as 75%
  • Scores 80% or better in generating positive opinions among recipients.

Challenges for SME businesses

The biggest challenge in this area for most SME businesses is having the internal resource and expertise available to effectively manage hybrid mail campaigns. With around 75% of email marketing still being run by in-house teams, the obvious solution is for print providers to offer a combined solution of print and email to their customers. The customers would then benefit by freeing up internal resources and also having a partner with the expertise to run hybrid mail campaigns.

When print providers start dealing with hybrid direct mail it creates the opportunity to develop and expand their data management capabilities. Currently the bottleneck for the growth of Big Data management is growing the skills fast enough; a McKinsey Global Institute report projected that the United States needs 140,000 to 190,000 more workers with “deep analytical” expertise and 1.5 million more data-literate managers. So if there ever was an opportunity for growth staring you in the face, there it is.

A major part of managing Big Data projects is asking the right questions: How do you define the problem? What data do you need? Where does it come from? What are the assumptions behind the model that the data is fed into? How is the model different from reality? Listening to the data is important, but so is experience, intuition and a much deeper understanding of destination markets and consumer behaviour. After all, what is intuition and gut feel? It is the human brain analysing large amounts of data to draw conclusions rather than using a maths model.

Digital print technologies have advanced to engage target audiences through data driven personalisation in a very similar way to how email and other online capabilities have progressed. Variable data printing utilises triggers based on consumer data and segmentation to determine the messages and creative assets. Combine all these elements with timely delivery services and you have the most compelling and effective marketing channel there is.

Summary

Neil Falconer -Print Industry Strategy Consultant and MD of Printfuture.com

Neil Falconer -Print Industry Strategy Consultant and MD of Printfuture.com

So direct mail may be changing into hybrid mail and undergoing something of a renaissance, but let’s be clear the printed part of a direct mail campaign is the most important and adds the most value. As print providers we all need to spread the word that direct mail is alive and well and competing very successfully in a digital world.

This article was commissioned by Ricoh to bring you independent opinions from industry experts. We hope you find our guest speaker’s views interesting and stimulating. We would appreciate your feedback. 

For more information about Ricoh’s Packaging solutions and initiatives see:  Ricoh-europe.com/printandbeyond