Written by Gerry Mulvaney | 05 January 2012

Conversations with customers and suppliers in the last quarter of 2011 lead me to believe that 2012 could be a year of seismic change in the Industry. The last time this happened was when the internet changed the knowledge model from manufacture and distribution to distribute and then produce locally.

Before the internet, knowledge was manufactured in bulk and then distributed to consumers. The internet reversed the process, distributing information to millions of consumers who then each printed out what they wanted. There is no doubt that this increased the volume of print, but it was at the expense of traditional printers. Many products of traditional printing methods are disappearing or have already gone. Airline tickets and boarding cards, headed notepaper and business stationary, even dare I say books are disappearing as mass produced items.

The advent of digital printing has meant that high quality, personalised and very targeted print is now being produced and then distributed to consumers, but increasingly this targeted approach is involving other communications media. Suddenly the people who in my opinion are innovating and leading the changes in the industry are no longer regarding themselves or even calling themselves printers. They are communications specialists and are starting to use other mediums to communicate for their clients.

The common factor when talking to anyone leading this change is data. Every single one of them spoke about it as being the key to being able to change their business. The data they are talking about is that held by their own customers that relates to people who transact with them. This is information about existing customers and prospective customers. The obvious data is their name, address, purchase history and customer contacts, but increasingly they are helping their customers gather other data from sources such as social media which helps build a bigger and much more personalised picture of their customers activity.

I will give you some examples. One of the fastest growing areas of business for Xerox Global Services is its Communications and Marketing Services Division. They are dealing with some very big corporate clients and running their whole marketing campaigns for them. The data that they gather enables them to create multiple touch points for the corporate client with their customers, finding the best way to communicate their marketing message. Sometimes that will involve print, but increasingly Facebook, Twitter, YouTube and Google are amongst the ways they communicate.

I was talking to a customer recently who had installed a large digital press. I was impressed with the work they were producing, but he was more excited about the fact that he had designed a customer’s web site for them and created some avatars for them to use on Twitter. There was more profit coming from those services than from the digital print they had produced for the customer. Another large client had come to them for a quote for a large number of brochures. The conversation had turned to what the customer wanted to achieve as a result. Once this was understood, the quote for the brochure was abandoned and an event created for the client, involving a casino evening with a large print order for personalised invitations, pull-ups and poker chips as well as a Twitter and Facebook campaign around the event. The client’s data has been acquired for the event, but will now be the basis for more cross media marketing campaigns. The profit margin for my customer will be four to five times that which would have been there if he had won the original job and printed it on his Heidelberg.

Another digital customer has persuaded his local college to Tupe across the members of its marketing department, together with their marketing budget and marketing database. He has guaranteed savings as well as transforming the way they communicate with their prospective customer’s – students. This young client base respond much more readily to social media messaging than traditional prospectuses, so my customer is using the database to interact with them on behalf of the college and creating a much more personal and responsive campaign and reducing the amount spent on print.

Each of these examples shows how print volumes are being further eroded as other methods of communication expand. If you look around now the signs are there. Man Roland didn’t go into administration because they made bad presses. It was because the market for presses had fallen dramatically in the last few years, as print volumes fell. The market for mobile phones, tablets and e-readers is growing at a phenomenal rate and the smart people in the industry are turning their attention to taking control of their customer’s data and creating digital marketing messages.

So as the internet turned print turned from analogue to digital in the 90's, I believe that in 2012 it is now turning it from digital to electronic.

Gerry Mulvaney
gerry@graphicdisplayworld.com

Written by Gerry Mulvaney | 05 December 2011

I suppose we shouldn’t be shocked when we hear that a major German press manufacturer has filed for administration, given the state of both the European economy and the printing industry, but we are.

The news that Man Roland had filed for the German equivalent of Chapter 11 came out of the blue and brought back memories for me of the same thing happening to Linotype Hell some years ago. They were another one of those giants of the Industry that had been around forever, always had large stands at trade shows, fancy head office facilities and employed thousands of people. Then suddenly, bang and they are gone - or in Linotype-Hell’s case, swallowed up into Heidelberg under pressure from the German government.

At the time we were all gobsmacked and didn’t see it coming. Sure Apple had come along and destroyed the niche market that Linotype, Compugraphic and others had enjoyed for their proprietary front end systems. Postscript from Adobe meant you could use a Mac to produce finished artwork electronically, but you still needed to output film. Or rather you didn’t since you could now go directly to plate. Some manufacturers were able to make the transition from filmsetters to platesetters, notably Dainippon Screen, but Linotype Hell was not quick enough and their shareholders and staff paid the price.

It has got to be hard being a European press manufacturer today. Here you have a large factory, staffed with skilled workers who have spent their working lives making printing presses. The European market for these products is shrinking as lithographic printing transfers to India and China and banks stop lending to their customers in Europe who do want to buy a press. You have a high series of fixed factory costs, employment legislation that makes it difficult and costly to downsize and a recession that makes your bankers reluctant to support you.

It can’t be any easier for the other German press manufacturers, because the conditions are the same for them, so we have to assume they are not gloating over Man Roland’s demise. You can’t suddenly switch to making iPads even if you wanted to, because the Chinese have cornered that market. Even selling presses to the growing Chinese and Indian printing markets is not on, since those countries have now got manufacturers of their own. Remember how many Chinese companies we saw at IPEX 2010?

If the market is tough for the press manufacturers, spare a thought for the plate manufacturers too. The big three – Agfa, Fuji and Kodak are fighting to keep their share of a declining market at the same time that Chinese manufactured plates are being imported into Europe. The same comparisons with press manufacturers can be made with the plate manufacturers, who will also find it very difficult to make something else that customers might want on a redundant plate line. Therefore I don’t think it will be too long before we hear that one of these leading pre press players is exiting the Industry.

gerry@graphicdisplayworld.com

Written by Gerry Mulvaney | 07 November 2011

This is a story I have told a few times. It is not mine, but one that was handed down to me many years ago by my old boss. It holds true today as it did then and whenever I tell it, it usually brings a smile of recognition in the listener.

Negotiation is a fairly simple process. If two half sensible people are involved, they can sit across a table from each other and craft an agreement that will bring profitable benefits to both sides. The agreement will be long lasting and simple to operate. It can usually be left to others to implement and require little further management input. Getting two half sensible people together for the task is by far the best way.

Sometimes it doesn’t work like that and the half sensible person has to deal with a pillock.

It is still possible to get an agreement, but the half sensible person will have to work hard to make sure there are benefits to both sides. The agreement can still have longevity and be put into practice by other team members. It is tough for the half sensible person in this situation and the negotiation will take a lot longer, perhaps require some management intervention, but the outcome will usually make the effort worthwhile.

You might be ahead of me by now.

If two pillocks are involved in the negotiation, sitting across the table from each other, it is an almost impossible task to reach an agreement. The outcome is likely to favour one side, which means it won’t be long lasting; it is unlikely ever to be implemented by others and will require constant attention from senior management. In other words, it is to be avoided at all costs.

Unfortunately, most companies I have worked for over the years have employed a few pillocks. Mostly they are not pillocks all the time; they drift in and out of the persona.  Some of the time, I too have been a pillock, before someone has pointed it out to me.

Even more unfortunately the companies I have worked for have not cornered the market in pillocks, so it is possible that one or two may even exist in your organisation.

So be aware and when you see evidence of them operating, make sure at least one half sensible person is involved in the dialogue.

Gerry Mulvaney

gerry@graphicdisplayworld.com

Written by Gerry Mulvaney | 14 October 2011

My forty year selling career started because an Italian company, Olivetti, invested in training me in the early 70’s. I went from being a bank clerk to an office equipment salesman via a month’s residential course at their Hampshire training centre. Over the next few years, I spent several more months at the centre, at Olivetti’s expense.

I mention this because it would be rare for a company to spend that sort of money on new recruits these days. Olivetti believed that investing in their staff would pay them dividends in the long run. Their staff would be more productive, would stay longer and enhance the company’s reputation if they had been properly trained.

My present employer is also a big investor in training. We have a graduate recruitment programme which provides a route into sales management and also an engineering training programme at our academy in Lincoln, where all our field engineers are taught their skills. The company has invested a lot in its staff and continues to do so. You will understand therefore why training is a subject close to my heart and one that is often a subject of debate with my customers, who are sometimes loathe to invest in it.

The traditional route into the graphic arts industry has been through apprenticeships and college based education. This was fine while the lifespan of traditional production methods were measured in decades, rather than years or months. Now apprenticeships are a thing of the past and college courses are becoming rarer than rocking horse excrement. Manufacturers and suppliers of digital equipment are taking on the training mantle and providing the education needed by their customers staff to operate digital equipment.

The problem is that customers are not putting a value on this training. They expect it to be provided for nothing and then hassle the trainers to get it completed so the staff can get on with their current work. It is no surprise that many of the service calls placed with suppliers reportedly have more to do with training or lack of it, than with a machine malfunction.

Now PICON, the industry body that represents manufacturers and suppliers, has partnered with Proskills, the training body that covers the graphic arts industry, in an attempt to put a value on the training that is provided to operators. A number of the PICON members are having their training assessed by Proskills with a view to seeing if successful completion of training can produce a certificate that could count towards a formal qualification such as an NVQ. There are a number of hurdles to overcome, for example how can you compare training on an HP Indigo with a Xerox iGen, but never the less it is small contribution to the overall debate.

You don’t hear much about Olivetti these days, now part of the Italia Telecom conglomerate, but I occasionally come across their products today and each time I say a small prayer of gratitude for the start to my career they gave me.

Gerry Mulvaney

gerry@graphicdisplayworld.com