C. Clint Bolte & Associates

There was no homerun per se of a new equipment or technology introduced at Graph Expo 2007. Yet the same cannot be said for the plethora of educational opportunities. This year there seemed to be a clear delineation in the highpoints of this annual cornucopia of publishing and print methodologies; (1) education and (2) continued enhancements of proven technologies. And almost without exception many if not most of these timely learning venues had good attendance. To name but a few; Executive Outlook had 45% higher attendance than last year, R&E Council's Critical Trends Breakfast was full, and Dr. Joe Webb's "Graphic Arts 2017" ran out of coffee as they had so many people.

But let's step back a minute. Traditionally the Graphic Arts Show Company has 70 hour and a quarter or more seminars, PIA/GATF has organized intensive topical sessions each day for professional educators, and in recent years each of the specialty product pavilions, i.e., Mailing & Fulfillment, Wide Format have had a series of free, pointed presentations running throughout the show. These were truly the tip of the iceberg in learning opportunities at Graph Expo 2007.

NAQP had a leaders conference concluding the day before the show opened, for the first time there was a day long Print Buyers Conference, IPA hosted a luncheon to hear a group of pre-media experts, and several vendors hosted extraordinary presentations in their booths by reputed experts. These included Heidelberg's Print Academy, NAPL's Management Services Seminars, and QuadTech's hourly presentations.

Statistics on attendance may not be readily available to gauge the success of these learning initiatives. But I can personally attest to the fact that my 0700 hotel shuttle bus (the first Graph Expo run each morning) was nearly full each morning taking attendees to the numerous McCormack Place breakfast seminars.

Here are the highlights of a few of these venues.

"Graphic Arts 2017: A Speculative Look Ten Years from Today" was organized by WhatTheyThink.com and sponsored by MAN Roland for the fifth year in a row.

Dr. Joseph Webb, Director of WhatTheyThink.com Economics & Research Center takes the numbers available to any enterprising economist and adds his own insightful graphics/publishing/print interpretation. Always with a sense of humor, his "doom and gloom" projections invariably have a glint of opportunity if the CEO will but heed. This presentation was no exception as he offered business segment employment and enterprise projections for the next decade along with his projected trends.

By the time you have read this article Dr. Joe expects that the Fed will have already lowered interest rates at their September 18 meeting in an effort to boost the steadily declining U.S. economy. The last six quarters of steady printing industry profits have been due in no small part to an overall reduction in non-production employment down to 182.1 thousand people. In a stagnant economy, profits can go up with a shift in product mix. "Stop doing nonprofitable work!" remarked Webb. Even if it seems to fulfill the excuse of marginally contributing to overhead costs.

The industry should benefit next year (2008) from the political campaigns, although this might be the last "print" dominated campaign. Overall industry revenues should continue their downward trend in 2009.

Following the '08 election Webb expects the federal legislation to constrict long-term growth and wealth creation. This translates to slow business growth and stagnant capital investment. The developed countries (Old Europe) are expected to reduce taxes, especially corporate taxes.

Commodity cost indices have doubled over the last five years while the metals segment has nearly tripled in a little over two years. Printers are already experiencing sticker shock for printing plates and steel for new equipment.

As a caveat to his long-term projections, Webb precluded, "Just because it is possible does not mean it is marketable." Could he have been referring to waterless printing or the latest of a dozen different halftone-screening technologies?

Graphics communications technology trends over the next decade include; (1) rampant connectivity at declining costs, (2) ever richer (i.e., quality) communications with more video, (3) mobility from the hand held super computer will be habit forming, (4) data storage will be free, (5) instant access to information and content with printing being optional, and (6) e-com will be the normal course of business for everything.

However, these dichotomies will be apparent; (1) proven technology and its adoption will not necessarily be in lockstep, (2) advancing technology and profits are rarely simultaneous, (3) all technologies are two-sided, e.g., the Internet competes with printing and yet it creates and expands opportunities for print/publishing business.

The following projected vocational demographics present interesting issues:

Freelance growth is expected to outpace all traditional sources of employment. Production enterprises that offer continual professional network venues for these entrepreneurs may be positioning themselves to be the preferred production partner and larger project referrals could be coming their way.

Publishers' uncertain future includes; (1) monetization of content will remain a serious issue, i.e., content needs to create value beyond publishing, (2) contrary to popular opinion the Internet has limited space, (3) there will be more and more small publishers, (4) severe downsizing of infrastructure will occur creating the challenge of redefining publishing as a business.

Magazines and newspapers are expected to compete more closely on the Internet and in the area of monetizing their content. Their "deadlines" are meaningless as they become "hourly."

These demographic projections for commercial printers are continuing the downward trend of the past ten years;

General commercial printers are and will be confronted with these challenges; (1) pressure to change the "nature of costs" is critical due to the lack of being able to raise prices, (2) must consider opportunities in non-print media if only to get an earlier heads up on projects, (3) the mobile computing of all types of communications will reduce reliance on print, (4) digital printing has value because of its integration with communications and information storage and transmission, yet (5) on demand printing is a weak competitor to computer screens for many applications, and (6) environmental sustainability will become increasingly important.

Where will the job opportunities be? The decrease in sales jobs is already evident in the economic data and yet understanding and knowing how to market new and evolving multiple media applications will be in demand. Skills to implement and deploy multiple media will be a valued specialty. While graphics education is nice, the best "ticket" to this industry will be a degree in computer information systems, according to Joe Webb.

Executive Outlook 2007: Success Quartet - Economics, Marketing, Technology, & People

Xerox and Heidelberg continue to sponsor this fast-paced presentation of tips and tactics on printers' survival. Bill Lamparter of PrintCom Consulting organized and moderated this tenth annual day-before-Graph Expo event.

Andrew Paparozzi, NAPL Chief Economist, warns that printers should be concerned about which of their clients may be retrenching next year as the Fed continues to correct for the excesses brought on by poorly valued assets backed by sub-prime lending. While it will be an election year, this lost revenue may be difficult to replace.

The printing industry is really a Tale of two Gaps as profit and revenue leaders continue to outpace the industry as a whole. During 2000-2006 leaders experienced average annual sales growth of 11.6% versus the rest at 1.0%. During the robust period of 2004-2006 the others picked up 4.2% per year while the leaders surged ahead at 15.2%.

Barb Pellow, Director of InfoTrends, emphasized that the right marketing mix for printers should include (1) shameless self-promotion of public relations and customer/press events, (2) networking at tradeshows and conferences, (3) viral marketing, (4) mass media advertising, (5) direct mail, (6) your own website, and (7) engaging the infrastructure via associations and partnerships. Viral marketing is that phenomenon that "facilitates and encourages people to pass along (one of your) marketing messages," e.g., VistaPrint's name on free business cards.

Lamparter gave the technology overview by stating that the printing industry is "technology rich but implementation poor." This is evident by the proportion of obsolete equipment, i.e., greater than ten years old, still running in plants. This includes two-thirds of sheetfed presses, about 60% of web presses, nearly three-quarters of narrow webs, and over 75% of post press equipment.

The panel of 16 editors and consultants that vote on the Must See 'Ems list every year initially ranked the most important technology areas. For the second year in a row Management Information Systems and IT skills were NO. 1. Don Goldman of Consultware shared statistics from an MIS industry adoption survey. Of those who have implemented some form of MIS software designed for the printing industry 47% of print-for-pay firms, 18% of in-plant printers, and 10% of printers in China were affirmative. And yet the proportion of firms with no MIS system at all was 10%-print for pay, 52% in-plants, and 40% Chinese printers. A 2004 InfoTrends study indicated that of the 8,485 qualifying MIS systems (computer-assisted estimating, order entry, job costing, etc.) less than 3,000 have implemented all of the modules available to them.

Goldman laid the blame of poorly implemented MIS efforts to (1) lack of ownership, (2) inadequate investment in training and ongoing IT support, (3) over/under engineered, i.e., too many or too few operation codes, (4) lack of data integrity, (5) resistance, and (6) lack of best business practices which can often be learned from active involvement in the Software vendors users group.

Chris Echevarria, Chair of NPES' PRIMIR marketing research arm and Manager of Marketing Information for Goss International shared some highlights of 2007 PRIMIR studies. The largest one done in recent years has been the $150,000 effort in three phases of 300 pages each conducted by the UK PIRA group entitled; The Future: The World Wide Market for Print. The attached chart from this study shows the ranking by country 2000-2011. China moves up to #3 overtaking the UK and Germany while India moves from #11 to #8 and Indonesia from $21 to #13 suggesting print markets with significant long term potential. Literacy rates climbing in developing countries should bring the combined print market value from US$54B to US$148B.

Web-to-print case studies are of growing interest. Steve Anzalone, President of Indianapolis' Full Court Press a part of the HardingPoorman Group said, "We always charge for the set up and maintenance of the (W2P) solution." Additionally clients not willing to utilize the W2P interface incur a higher price to cover the additional administrative labor costs.

The R&E Council Critical Trends Breakfast highlighted the show floor innovations for Graph Expo. Wes Lucas of Quebecor World keynoted the session by saying that technology investments are simply the cost of entry into the game. "Innovation is the key to reaching full potential."

Barb Pellow commented that virtually all digital print engine manufacturers are offering business development aids to their clients to help pay for this new equipment.

Howie Fenton, NAPL Senior Consultant, remarked that color optimization was a clear enhancement offered by several pre-media vendors. The new file format for Microsoft Vista operating system, XPS, "is reported by early users to offer neither backward nor cross platform compatibility."

IPA organized a luncheon presentation by officers of five of the leading pre-media firms in North America. John Reilly, Chairman of the CAPS Group, offered that outsourcing of pre-media services was climbing as "in house volume grows and employees can't or won't work the required overtime. Plus more boutique advertising agencies are popping up due to the large agency consolidations. These boutiques readily outsource their production requirements." Mary Lee Snyder, President of RR Donnelley's PreMedia Division added corporate purchasing departments are initiating more relationships as clients are asking RRD "during this third and fourth quarter to take over their employees so they can start the new fiscal year with fewer FTE."

The printing industry is concerned about its staid image and apparent inability to attract new talent to its employment ranks. Graph Expo 2007 showed potential employees of any age that there exists the challenge of a vertical learning curve. If this is appealing, they may have found a home. Those who feel their learning ended with a degree had best look elsewhere.