strategic paths for a digital future...high speed continuous inkjet customer analysis • digital...

1 © 2012 InfoTrends www.infotrends.com © 2012 InfoTrends

Strategic Paths for a Digital Future

Jeff Hayes President May 8, 2012

2 © 2012 InfoTrends www.infotrends.com

Agenda

Technology and Recessions

Offset Marginalized

Strategic Paths

InfoTrends Activities

1

2

3

4


$0

$40

$80

$120

$160

'89 '90 '91 '92 '93 '94 '95 '96 '97 '98 '99 '00 '01 '02 '03 '04 '05 '06 '07 '08 '09 '10 '11 '12 '13 '14 '15 '16 '17 '18 '19 '20

Analog Print

Digital Advertising

Digital Print

R

E

C

E

S

S

I

O

N

?

Technology Disrupts, Recessions Clarify

U.S. Print and Online Advertising ($B)

Segments: U.S. Commercial Print, Quick Print, In-Plant, Data Center, Photofinishing

Digital Prepress Digital Workflow Digital Media Smart Media

Offset, BW EP Color EP Color EP, Inkjet


Sources: InfoTrends, Internet Advertising Bureau (IAB UK), PwC, Online Marketing Group (OVK) of the Federal Association of the Digital Economy (BVDW)

0

40

80

120

160

'09 '10 '11 '12 '13 '14 '15

Similar Trends in Western Europe

Digital Advertising

Digital Print

Analog Print

W.E. Print and On-line Advertising ($B)


HQ Offset

Low Cost Offset

Color EP

Inkjet

Digital Print Marginalizes Offset


Where Can You Grow?

?


Strategic Paths

Innovation Driven

Operations Driven

Dying

Surviving Thriving

More

• speed • quality • efficiency • sustainability • global markets

New

• services • products

• customers • business models

Continuous investments in … •Technology •Business processes •Sales & marketing

that lead to …

Striving


Strategic Paths for Service Providers

Innovation Driven

Operations Driven

Thriving

Dying

Surviving

Striving


Cloud/3rd-party +

Business & Infrastructure Transformation

On-site

Storage Programming

Analytics

Pre-media

Print

DAM

Supply chain e-Commerce

Workflow

Design

Bindery Fulfillment

Mobile

Online Social

Graphic Communications Services

Bandwidth

CRM

Integration


Strategy Recommendations

• Focus on growth markets and applications

− High growth countries

− Labels, packaging, textiles, non-documents

• Invest in digital color printing and digital media services

− Inkjet, color EP

− Programming, data, content, mobile

• Build your sourcing platform and network

− Workflow, supply chain

− Commerce


•production media & outsourcing

•office document

technology & services

• consumer & pro imaging

InfoTrends … Helping you understand and develop markets

Proprietary, focused

In-depth, shared funding Low costs

Annual access


New InfoTrends Activities …

• Wide Format Metrics

• Ultimate Guides – Print MIS

• Digital Media and Marketing Service


Recent Multi-Client Studies …

• High Speed Continuous Inkjet Customer Analysis

• Digital Front Ends

• Emergence of Secure Digital Mailbox Services

• Promotional Print in a Mobile World

• SMB Marketing Automation Opportunity

• Evolution of Cross Media Marketing Service Providers


New Studies In Progress …

• What Do Label and Packaging Converters Want

• Transforming Textile Printing

• Next Generation Personalized Printed Products

• Print On Demand India

• Service Expansion for Document Outsourcing


Today’s Agenda

• When All That Could Become Digital Truly Became Digital

Ralf Schlözer, Director

• The Data drupa: Software & Workflow Transforming the Industry

Kaspar Roos, Associate Director

• Wide Format and the Packaging Parallel

Barney Cox, Senior Consultant

• Production Digital Print Growth Opportunities in Asia Pacific

Jim Hamilton, Group Director


drupa 2012 - When All That Could Become Digital Truly Became Digital

Ralf Schlözer Director On Demand Printing & Publishing 8. May 2012


The Digital Production Printing Hardware Market

• Continuous Feed Printers

• High-end Colour Presses

• Heavy-duty B&W cut-sheet Printer

• Light production Colour and B&W MFPs

• Mid Volume Colour and B&W Printer

• Digital Colour and B&W MFPs found in high volume office environments as well

High End

Light- Mid-Production

Entry Level


On Demand Printing Placements – US and W. Europe

Source: InfoTrends 2007-2011 Placement Report – US and WE

0

40,000

80,000

120,000

160,000

2008 2009 2010 2011

High End


Entry Level

Impact

of financial

crisis

Strong growth in High End Low growth in Light/Mid

Decline in Entry Level

Placements


2011 On Demand Printing Placements vs. Print Volume

Source: InfoTrends 2010 Forecast – US and WE

0%

20%

40%

60%

80%

100%

Placements Print Volume

High End


Entry Level

Share of Total


Global On Demand Printing Volume

Source: InfoTrends 2010 Global Forecast

0

200

400

600

800

1,000

1,200

1,400

2010 2011 2012 2013 2014 2015

High End


Entry Level

Print Volume (B A4 pages)


Global On Demand Printing Volume Driven by Production Color

Source: InfoTrends 2010 Global Forecast

0

200

400

600

800

1,000

1,200

1,400

2010 2011 2012 2013 2014 2015

High End Color

High End B&W


Entry Level

CAGR 27%

A4 Print Volume (B)


Productivity Driving Adoption

• Digital color is Closing the Productivity Gap

Digital Color Sheet-fed Offset Web Offset

250

500

1000

2500

5000

10000

15000

20000

B3 - simplex

B2 - simplex

B1 - simplex

B0 - simplex

B3 - perfecting

B2 - perfecting

B1 - perfecting

Full Web

Half web

SRA3 Sheet-fed toner

Roll-fed inkjet

B2 Sheet-fed inkjet

Spe

ed p

ages

/min

ute

B0 - perfecting

Roll-fed dry toner


When Everything Became B2

A complete list of all vendors offering digital B2 solutions

• Delphax

• Fujifilm

• HP Indigo

• Jadason

• Konica Minolta / Komori

• Landa

• MGI

• Miyakoshi / Ryobi

• Screen


When Everything Became Inkjet

A complete list of all inkjet system vendors *

• Delphax • Founder • Fujifilm • GraphTech • HP • Impika • KBA • Kodak • Komori • Landa • Matti / CTC Japan • Miyakoshi • MGI • Océ • Pitney Bowes • Ricoh • RISO • Timsons • TKS • Xerox

* Document Production Printing Systems Only


Technology Death Battle

INK TONER


InfoTrends Global CF Color Inkjet Study – 52 in-depth customer interviews

• Uptime of CF inkjet is fine, cost base is good, ROI is on track

• Good enough quality – at least in transaction

• End customers are accepting inkjet

• Paper is an issue – but there are workarounds

Of course many smaller kinks exist when it comes to individual deployments


Global High-Speed Color Printer Placements Are Rising

0

100

200

300

400

2005 2006 2007 2008 2009 2010 2011

• 28% for placements

• 47% for annual print volume

*Note: Each placement is one four-color print engine Source: InfoTrends Quarterly Tracking Program

Color Printer Placements* > 10 Million Impressions per Month Duty Cycle

InfoTrends Forecasted Growth


2011 Continuous Feed Colour Inkjet Line Up

Manufacturer's duty cycle is in parentheses Italic = InfoTrends estimate Xerox 980 is toner system

20

40

60

80

100

120

140

Du

ty C

yc

le (

in m

illio

n A

4)

HP

T200 (25)

T300 (75)

T350 (105)

T400 (140)

Info Print

5000 MP (20)

5000 GP (40)

5000 VP (80)

Kodak

300 W (30)

VL6200 (61)

VX 5000 (93)

Prosper 5000 XL(120)

500 W (50)

500 N (25)

300 N (15)

Impika

iPrint 75 (32)

iPrint 125 (54)

iPrint 250

(108)

iPrint 150 (65)

Xerox

980 (22)

CiPress 500 (50 twin)

JS 2800 (65)

Océ

CS 3500 (15)

JS 1000 (33)

JS 3300 (98)

JS 3000 (80)

JS 1900 (55) JS 2200 (50)

JS 1400 (43) JS 1500 (44)

Pitney Bowes

IJ 20 (25)

IJ 30 (75)

IJ 42 (140)

Screen

TruePress Jet 520 EX

(20)

TruePress Jet 520

(40)

TruePress Jet 520 ZZ

(80)

Fuji Xerox

2800 Inkjet 200m model

(80)

2800 Inkjet 100m model

(40)

Miyakoshi

MPJ 600 20C (25)

MPJ 600-20F (80)

MPJ 600-20C (50)

MPJ 600 20E (40)


High-End Inkjet – Growth versus Choice

• Over 40 Colour CF models (>10M duty cycle) marketed in 2011

• About 320 engines installed worldwide in 2011

• 2 engines = 1 print line

• = about 4 installations per model on average


Technology Death Battle

INKJET INKJET


High-End Inkjet Expectations

• Growth at the expense of all other print processes

− Digital

− Analogue

• Limited investment capital from PSPs

− Affordability

− Size

• Considerable competition in inkjet offerings

− Wide range of products

− Price pressure


• HP Indigo

When (Almost) Everything Became Inkjet

Liquid toner electrophotography

• Miyakoshi / Ryobi

• Océ

• Xeikon


Summary

• Digital printing is the best fit to today's requirements

• Inkjet is moving to the next stage against mainstream analogue

• Liquid toner can contend for high-quality, high volume applications

• Despite all the opportunities – the competition remains stiff


The Data Drupa Key Software Trends at Drupa 2012

Kaspar Roos Associate Director May 8th 2012


Cross-Media Strategy Is Essential

Explosive growth of mobile devices

Rise of Social Media

E-books Have Lifted Off


Strategic Issues for Vendors

• How can customers grow in a consolidating market?

• How can customers produce more efficiently?


Data is the Answer

1. Mining

2. Refining

3. Applying

Cloud infrastructure to help

Analytics & visualization to extract relevance

Insights increase productivity and improve targeted communications


Software Evolution

Drupa 2004

JDF

Drupa 2008

W2P

Drupa 2012

Hybrid

Drupa 2016

Cloud


Data Increases Value and Efficiency

Print Production Trends

(PSPs & MSPs)

Communication Trends

(Enterprises & SMBs)


Enterprise Communication Trends

1. Optimizing Customer Interaction

2. Marketing Automation & Brand Control

3. Cross-Media Marketing

4. Changing Role of Print

Data Analytics

Meta data to describe & classify assets

Digital Content & Channels

Drive recipients to online channels


Similar Trends Visible at SMBs

7%

9%

13%

12%

34%

40%

35%

83%

21%

27%

32%

39%

61%

59%

61%

83%

0% 20% 40% 60% 80% 100%

Podcast or Webinar

Online video

Blogs

Display/Banner ads

Social network presence

Online directory

Search Engine Marketing

Company Web site

Percentage of Respondents

2011 (N = 2,010)

2009 (N = 2,243)

Do you currently use the following Digital channels to promote your business on the Internet?

Multiple Responses Permitted

Source: InfoTrends’ SMB marketing automation study, 2011


Vendor Implications

• Greater need for data tools, support and services

• More opportunities to apply data

− Targeted communications

− Process efficiency & machine utilization

• Role of print is changing

− Becoming a premium channel

− Drive recipients to online channels

It is about optimizing the total communication experience – from creation to fulfilment across every available channel

Data Will Drive This


50%

59%

29%

20%

0% 20% 40% 60% 80% 100%

IT enables my operations

to provide better

solutions that fit my

customers’ needs

The addition of IT

provides a competitive

edge to my print

operation

Strongly agree Somewhat agree Don't agree / no opinion

N = 133 Respondents who employ dedicated IT professionals

PSPs Are Adding IT Capabilities

Source: InfoTrends’ Emerging Trends, Q3 2011


Emergence of Cloud-based

Platforms

Disruption & Transformation: Solving the Innovation Gap

Disruptive Technologies … Transformative Technologies …

… to improve communication ROI … for higher productivity

Mobile Social Web

Data Analytics Web to Print

Workflow


Cloud Workflow Direction

Cloud-based Workflow Automation (Vendor)

Partner Solutions

End-users End-users End-users

Partner Solutions Partner Solutions

End-users End-users End-users End-users End-users

Print Operation


[email protected] Follow me on Twitter: @kasparroos

Thank You!


Wide Format & The Packaging Parallel

Barney Cox Senior Consultant 8th May 2012


Printing Industry Déjà Vu

• Cusp of major industry transformation

• Complex workflows and demanding applications

• Numerous partnerships and acquisitions

• Market development is essential


Print Industry Transformers

Photo Commercial Books Signage Packaging Labels

• On-demand production

• Super efficient workflows

• DAM of approved artwork

• W2P/e-commerce – customers, suppliers

• Great marketing

??


Packaging is Ripe for Transformation

Digital Package Printing

Technology

Buyer Demand

Supply Chain

Global-ization

New players


Pertinent, personal ≠personalized


Wide Format and Packaging Core Technologies

Heads Presses

Finishing Workflow

• Color management • Print MIS • DAM • Web-to-print

Integration & Customization


Technology Vendors Making Their Moves

Digital

Traditional

Emerging


N = 115

PSPs diversifying to deal with new market conditions

What kinds of changes have you made to deal with new market conditions?


N = 136 Respondents who plan to diversify into other print sectors

Wide Format PSPs Are Interested in Packaging

Which of these print sectors would you expect to diversify into?

Packaging


Packaging Firms Are Eyeing Wide Format

• Ely plant

Using 3D structural and graphical techniques to produce the full range of point-of-sale display packaging

• Bradford plant

Printing large format POS, POP and banners

• London agency

In-house promotion agency dedicated to improving the profile of clients and their respective brands


In Store: Two Become One

• Packaging + Signage

− Primary and secondary packaging

− FSDU, POP, POS

− Banners

• Integrated product campaigns

• Incremental revenue

− Design

− Production

− Installation


Global Installed Base of Wide Format Inkjet Presses – Packaging and Labels

0

5,000

10,000

15,000

20,000

2010 2011 2012 2013 2014 2015

Low End Mid Range High endUnits

CAGR, 10-15 4.9% 44.7% 44.9% 7.2%

Total


Global Value of Print From Wide Format Inkjet Presses – Packaging and Labels ($M)

$0

$100

$200

$300

$400

2010 2011 2012 2013 2014 2015

Low End Mid Range High endValue of Print ($M)

CAGR, 10-15 10.4% 52.3% 52.6% 18.4%

Total


Market Development is Essential

• Awareness of problems and solutions

• Tools for quantifying impact

• Ideas for new packaging designs

• Designing for digital

• Sales and marketing training


Packaging Strategy Recommendations

• Expect…

• Prepare …

• Hire …

• Seek …

• Invest …


[email protected]


Production Digital Print in Asia Pacific

Jim Hamilton Group Director May 8, 2012


drupa 2012 = The “Asia Pacific” drupa

• Large, growing market

• Source of many key technologies & manufacturing

• Strong history of print, but modest production digital print

• Complex and vitally important


APAC Economies – Size and Growth

0%

2%

4%

6%

8%

10%

12%

$0 $5 $10 $15 $20 $25 $30 $35

Source: International Monetary Fund

$28.3 8.1%

$20.6 9.4%

$7.7 4.1%

APAC

Growth APAC

North America

China

India

GDP – Purchasing Power Parity (Current $T)

Projected GDP Growth – 2011 to 2017

$11.3 10.3%

Mature APAC $17.1 4.5%

European Union $15.8 3.2%

$4.5 9.2%


Growth APAC Countries Taking Big Share of Global GDP

20.1% 17.2%

20.9% 19.3%

23.2% 22.9%

9.8% 8.8%

26.1% 31.8%

0%

20%

40%

60%

80%

100%

2011 2017

Growth APAC

Mature APAC

ROW

North America

European Union

Source: International Monetary Fund

Share of Global GDP

Printing equipment and supplies will follow


The Impact of the Earthquake and Tsunami


APAC is Critical for Digital Printing Equipment Manufacturing


Impact of the Great East Japan Earthquake

-9.9%

-15.1%

-0.6%

-17.6% -16.3% -17.1%

15.2%

70 to 90 MFP 91+ MFP SF printer 0 to 100K 101 to 300K 301 to 999K 1 to 10M

InfoTrends Quarterly Tracker

Color (duty cycle) Black & White (ppm)

2Q 2011 shipments vs. 5-year 2Q average


2010 Chinese Printing Industry Overview

• Value of Print = ¥576 billion (up 12% over 2009)

− About 106,400 printing enterprises; 4.5 million employees

− Roughly $845,000 per enterprise; $20,000 per employee

• Printing equipment revenue = ¥18 billion (up 20%)

− About 750 manufacturers; about $3.75M per company

• Printing material revenue = ¥37.3 billion (up 12%)

− About 250 producers; about $23.3M per company

• Over 3700 paper manufacturers

Source: The Printing and Printing Equipment Industries Association of China


Chinese Printing Industry Growth Rate (2009-2010)

Source: The Printing and Printing Equipment Industries Association of China

5.8%

7.7%

8.3%

8.7%

9.1%

9.1%

10.5%

10.8%

13.0%

16.6%

23.1%

0% 10% 20% 30%

Books & periodicals

Prepress

Wide format advertising

Screen

Newspapers

Notebooks

Commercial

Other

Trade

Packaging

Label


Conventional and Digital Print in China

• Fundamental market change

• Quick printing has become digital

• Shifting towards higher end segments


China Production Digital Print Market – Retail Value of Print

¥3,206 ¥4,862

¥12,799

¥32,940

¥0

¥10,000

¥20,000

¥30,000

¥40,000

2010 2015

Color

B&W

Source: InfoTrends China Print On Demand 2010-2015 Market Forecast

CAGR Overall 18.8%

20.8%

8.7%

¥16,005

¥37,802

Retail Value of Print (CNY Millions)


Next Stop: India

• Huge growth opportunity for production digital print

− Large GDP, strong annual growth

− Growing middle class and literacy

− Strong printing tradition

− High interest in production digital print

• Complex distribution and application requirements


West vs. APAC: The Value of Production Digital Print

Western Markets APAC (Mature) APAC (Growth)

Low cost short runs / quick turnaround

Very important Important Important

(at the right price)

Mail-based applications Dominant Important Less important

Automated workflows Very important Important Less important

Labor cost High Significant Low, but rising

Capital acquisition cost Important Important Very important

Running cost Market driven Market driven Critical to success

OEM supplies Less common Common Common

Break-fix services Often direct Through channels Through channels

Professional services (integration & business development)

Well established Developing Nascent


Recommendations

• The region deserves special attention given the growth potential

• Success in Asia Pacific requires a long-term commitment

− A sustained and local program is a requirement

• Partners are essential

− For software, distribution, service, supplies, marketing, business development, integration services

• A diversified supply chain provides insurance against market shifts and natural disasters

• System vendors must reassess the true values of production digital print for each country

strategic paths for a digital future...high speed continuous inkjet customer analysis • digital...

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