Print business: Setting up for change
Digitalisation of the print business: Setting up for change
The print business is on the verge of transformation.
As in every sector, smart technology is revolutionising the way businesses and individuals communicate as well as the services they offer and expect.
All change brings risks, but the worldwide outlook is good: the print industry is expected to grow in value from a global $767.4 billion in 2014 to a forecast $862.7 billion in 2025.
However, that growth will come not from an increase in volume – which is forecast to drop deepened by the the current corona crisis – but from momentous changes in the way companies operate and what they offer to customers.
The print industry had to adapt already
Changes in the print business have already been caused by the growing dynamism of its markets.
Just as people are increasingly using their smartphones for everything from ordering a cab to paying for a magazine, so too is their interaction with print providers shifting online.
This digital revolution is also transforming production: interlinked printing presses are operating almost autonomously, ordering replacement parts themselves and analysing data to enhance the printing process.
Increasingly, skill sets for those working in the industry are also shifting, with marketing growing in importance. Indeed, it could well soon be that the production of printed matter is no longer the most important part of a print provider’s business.
Coming in line with other industries
A recent study carried out on behalf of the Federation of German Industries found that European industries are at the beginning of a fundamental process of change that could mean new growth, higher productivity, and more prosperity for many – but also the potential loss of world market leadership.
The authors, the Roland Berger Strategy Consultants, calculate that:
• If Europe does not realise the benefits of digital transformation, it stands to lose up to €605 billion by 2025 – or more than 10% of its industrial base.
• If Europe does realise these benefits, it has the potential to gain €1.25 trillion by 2025.
Sappi envisages that digitalisation will entail:
• Smart factories gearing production to the wishes of individual customers;
• Smart companies organising parallel supply chains with other companies and adapting their offer to emerging trends; and
• Smart homes controlling logistics and reacting within seconds to the wishes or even moods of their residents.
For print providers, this means adapting to customers who want to order print products at the click of a mouse or a tap of a screen. Forecasts by Zipcon consulting are that in 2022, some 40% of the print market in Western Europe will be online – up from 28% in 2018.
There are several drivers to this transformation: rising company costs, growing investment pressure, decreasing margins and higher competitive pressures.
They all add up to the need to make companies faster, more agile, more flexible and, crucially, more attractive to customers.
Fortunately, the technology is there to make this possible.
Changing rigid value chains
Above all, digitalisation is breaking down traditionally rigid value and supply chains, transforming them into interlinked networks.
This opens up new sales channels and new fields of business activity, enhancing and renewing the business of print.
It will transform the relationship between print provider and customer, enabling companies to respond to clients’ individual needs more flexibly.
New product lines and product development
New digital technology enables print providers to expand their offer beyond classic printed products.
Already, online providers are disrupting the industry by offering customisation: e.g.: printed matter, including textiles, for hotels, seminars or trade fairs. Forecasts suggest that customised versions of magazines and brochures will gain in importance in the coming years.
While Mass Customisation is key to the development and growth of the print business, the real transformation is not so much in the end product, but behind the scenes: in the business models and value chains of print providers.
Companies who can take advantage of technological advances now stand to be ahead of the game, enjoying the benefits of digitalisation for years to come.