Printing Industry Coming Off a Strong Year
The print market is the strongest it has been in several years, and print as a medium should remain vigorously competitive well into the future, but both the industry and its supporting vendors still face some clear challenges that are likely to persist in the coming years. Those were the key messages of speakers at NPES’s 24th annual Print Outlook conference, held in Alexandria, VA on Dec. 9-10.
The conference explored the theme “Challenge and Opportunity in the New Media Mix,” and many speakers returned to the premise that print can and will thrive as a valued part of comprehensive marketing and communications programs.
“This is the best print market I’ve seen in about five years,” said Dr. Ronnie H. Davis, chief economist of Printing Industries of America/Graphic Arts Technical Foundation (PIA/GATF). He said total shipments of the printing industry for the first nine months of 2004 were up 4.1 percent, with no impact from price inflation.
Even though many printers are increasing their revenues by offering ancillary services, Dr. Davis said “ink on paper” shipments were also up by 3.5 percent during this period.
Several key opportunities will attract printers’ attention in the near future, Dr. Davis said, including growth in such niches as direct marketing and increasing sales of digital and toner/based printing, as well as expansion of ancillary and print logistics services.
For 2005, Dr. Davis projects that overall print shipments will rise 2 to 3 percent. On the horizon, however, a likely postal rate increase in 2006 could have a serious negative effect on the industry. If postal rates go up by 10 percent, he said, the physical volume of advertising mail could go down by as much as 8 percent, about half of which will pass through to printers in the form of diminished business.
With advertisers ducking commercials in other media, print can prosper by emphasizing what it does best – creating an intimate personal relationship with readers. That was the view of Carolyn Bivens, president and COO of Initiative North America, a media planning and buying company.
“Print has unique advantages over other media,” she said. “Marketers know this. Media planners know this, and you should know this as well.”
As consumers have more and more media options available, including the option of avoiding ad messages in many media, print should capitalize on its ability to engage readers, Ms. Bivens said. “Research...consistently points to print as the medium through which consumers develop the closest and most engaged relationships with advertisers and their brands,” she said. “Ninety percent of magazine readers pay full and complete attention. No other medium can say that. In an age defined by multitasking, this is a real competitive advantage.”
Ms. Bivens predicted 2004 would show total ad growth of about 6 percent, with magazines “one of the more robust media sectors,” recording growth of 8 to 9 percent. To maintain and expand this performance, she added, “those in print need to do a better job in demonstrating to marketers a robust return on their investment.” As part of this, she said, “the industry needs to sell to its main strength, which is engagement.”
The conference keynote speaker, author and retired ad industry leader Joseph Cappo, said diverse opportunities for print are arising today because advertisers are putting more emphasis on accountability for their marketing budgets. Mr. Cappo noted that ad pages in magazines began to increase in July 2004 for the first time in more than a year, and continued to show growth throughout the second half. New magazines are being launched and are often growing at the expense of larger and older publications.
“Direct marketing in all its forms will continue to grow,” Mr. Cappo said, “because it is accountable. Sales promotion (including point of purchase advertising and signage) will grow even faster.” In addition, Mr. Cappo cited such trends as custom magazine and book publishing. Some large retailers, for example, are now producing their own magazines, as are TV networks such as ESPN.
In the past, Mr. Cappo said, advertisers “spent far more money on television than they should have, without their agencies being able to tell clients what their results were.” Today, he added, such new technologies as digital recording devices are enabling TV viewers to avoid commercials altogether, making the return on TV advertising even harder to track.
Conference proceedings are available from NPES for $150. More info: NPES (703) 264-7200; fax (703) 620-0994; e-mail: email@example.com; we: www.npes.org.