© 2005 IBM CorporationIBM Printing Systems
POWERFUL, COST-EFFECTIVE OUTPUT SOLUTIONS2/23/2006
Marketplace trends and the impact on UK Print Industry
Declan Rea
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Topics for discussion
� WW Industry Trends � UK Industry Status� Segment Trends� Implications
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Source – Caslon Market Data 2004
World Wide Trends
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Mail Intensity Across Countries – volumes vary
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UK – Mergers, Acquisitions, Consolidation
� Merger activity in 2004/5� Job losses� Suppliers struggling
Source: Three headlines from Dotprint, Feb 3rd
•Astron Buys Edotechand Experian
•RRD buys Astron
•Deutsche Post to buy Williams Lea
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UK Print Industry� Overall UK Print Industry has declined
by 3% since 2001� Significant declines in Advertising /
Direct Mail and Book printing� But …there are a number of sectors
which are growing, including:� Programmes, tickets� Periodicals� Business forms
-3%12,79412,31512,88113,155Total
-49%346396412516Composition & platemaking
-34%131137141176Printed paper & paperboard
-19%1,1561,2671,2901,372Books, brochures, leaflets etc
-10%2,9013,0153,1743,196Advertising literature
-10%537534554589Other printing
-9%1,0869721,0891,181Printed packaging
-3%124126131128Postcards, greetings cards
-3%825700883848Graphic services
-2%235205195241Newspaper printing
0%475442456473Bookbinding
2%422397438413Business forms
3%753680719730Printing onto non paper/board
4%317275313304Security printing
5%467454429445Printed labels
5%1,2511,2221,2121,187Periodicals
23%1,7691,4951,4441,358Printing of programmes, tickets
etc
CAGR2004200320022001PRINTING
Source: UK manufacturer sales (PRODCOM) 2001 - 2004
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UK – Digital B&W Industry Trends
� Direct Mail� Flat
� Transaction volume� Flat to declining due to
• Increased use of color• Increasing use of Service Bureau’s
� Digital Book volume in UK� Migration to digital continues slowly � Larger users
• Oxford Uni, CUP, LSI..
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Direct mail
� Internet is growing – but it’s still only 2% of total spend� More usage around acquisition
� Direct mail has been growing steadily since 1994.
� 2005 was the first year that DM declined.
� Last year UK companies spent £2.5 billion on Direct Mail.
� Direct mail still has best ROI for marketers
0
2000
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10000
12000
14000
16000
18000
1990 1992 1994 1996 1998 2000 2002
InternetDirect MailCinemaRadioOutdoor& TransportTVPress
Total UK advertising expenditure 1990-2003Source: DMIS
Direct Mail
0
500
1000
1500
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3000
1990 1991 1992 1993 1994 1995 1996 1997 1998 1999 2000 2001 2002 2003
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Direct Mail Trends �Emerging trends and value adds;
� Web integration – personalized url
� Increasing use of relevance• 3 x uplift in response rates vs personalizing
� Increasing vertical integration• Transaction documents
� Future technologies…• Cellular phone• Emerging Electronic Media: Blogs, Wikis, PODcasts
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Direct Mail Competitive Strategies �Integrate Direct Marketing Components;
� Focus on value adds – “value leader in direct marketing”• Call center• Telemarketing• Response Management• MICR• Campaign Management • Data Mining• Print Management• Digital color options available for Personalisation• Creative Services
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Digital Book Trends
� Only 2% of WW monochrome book pages are digital� Why?
� PQ� Cost per book� Offset efficiencies improving – DI� Future technologies – web, ebooks, PODcasts…
� Digital CF is now acceptable for a subset of volumes� Digital CF reduces the cost per page 20-50% vs CS� Run length break point continues to shrink 1000 -> 300
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UK Trends for Books
� 2004 6.4% increase in book sales� Growth predicted at 10.4% between 05 and 09.� 65k titles in 90, 116k in 2000, 161 in 2004 -> self publishers and
small publishers exploding� More titles to meet needs of big box chains - quick turnover of titles with
short shelf life.� 4000 book publishers in UK� Net book agreement ended in 98, allowing retailers (vs pubs) to set
prices - this is driving lower prices led by superstores.� UK has highest productivity in Europe for book printing� Shorter book page count and run length in Europe than US� Total book market = 3.7 billion pounds in 05� Customers rank 1. TCO, 2. PQ, 3. Reliability, 4. Speed as biggest
concerns w digital
InterQuest study; The Digital Book and Manual Printing Opportunity - Oct 2005
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Emerging Strategies for Books
� 3 models� Short-run
• Printers uses digital to compliment offset web and cutsheet to provide a mix sell to publishers - ie mix the higher print cost of digital with the lower supply chain costs for certain volumes - become a one stop shop,
� Versioning• Printers publishes updates eg.updated legal chapters vs the whole book, another
example is flight manuals� Variable
• End customers are demanding truly variable docs - such as financial, real estate, customized manuals for cars, or like exam papers that are highly versioned but also variable due to tracking id numbers
� Integrate litho workflow and prepress with digital� Leverage PDF and JDF
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UK Print Industry - implications
� Focus on niche areas � Develop value-added services that differentiate � Tight cost control - Right first time � Audit trails for increasing industry regulations� Drive for Standardization – JDF, PDF, UP3i, AFP � Increasing need for automated workflows � Multi-vendor hardware and software � Shortened print windows – tough SLA’s
© 2005 IBM CorporationIBM Printing Systems
POWERFUL, COST-EFFECTIVE OUTPUT SOLUTIONS2/23/2006
IBM Printing Systems
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