Commercial Print Providers Represent a Growing Opportunity for Dealers and Manufacturers

The Industry Measure - September 8, 2006

Wide-format printers and plotters (there's a word you don't see too much anymore!) have been around for at least 20 years, but arguably the first viable graphic arts application for the technology was called the MegaChrome system, developed in 1991 by Palo Alto, CA-based Colossal Graphics. It wasn't so much the printing equipment that made the difference, but rather what was added to the printing equipment. The MegaChrome system used a Xerox Versatec 42-inch 400-dpi plotter driven by an Intel 486-based print server that included a PostScript RIP-after all, the key to making wide-format work in a graphic arts workflow was PostScript compatibility. The system was licensed to a national network of reprographics firms that catered to a small niche market of engineers and architects.

In 1992, other systems featuring the Versatec began to appear, and other equipment vendors came out with new devices. Another milestone was reached in 1993 when Encad (acquired by Kodak in 2002) released the NovaJet 840, a relatively inexpensive inkjet printer. Before the NovaJet 840, the dominant printing technology for wide-format output was electrostatic. As a result, when we speak of wide-format printers these days, we are talking largely about inkjet devices.

There has been a great deal of activity and development in the area of wide-format graphics in the past decade and a half since. Speed, resolution, print quality, color accuracy, and price have all improved immeasurably. Still, wide-format printing has remained a niche application, relegated to sign shops, specialty printers, and the like. However, at Print 05, we saw that equipment vendors are making no small push to get general commercial printers interested in wide-format printing. Have they had any luck?

The data that follow are based on a series of market research studies that TrendWatch Graphic Arts conducts regularly among graphic arts establishments of all kinds. Specifically, the TrendWatch Graphic Arts Printing survey has been conducted twice-yearly (in spring and fall) since 1995 and contains the most comprehensive historical database of industry trends and equipment investment information. The markets that comprise the TrendWatch Graphic Arts Printing survey include:

• commercial printers
• quick printers
• magazine printers
• book printers
• prepress shops

(A brief summary of the TWGA methodology can be found at the end of this article.)

In spring 2006, we found that 11% of all print and prepress shops perceived "wide-format printing" as a sales opportunity. This is down three percentage points from the 14% who saw "wide-format" as an opportunity six months earlier.

When we break this down by specific market, we find that:

• In spring 2006, 19% of quick printers saw "wide-format printing" as a sales opportunity, down from 27% six months earlier;
• 15% of prepress shops saw "wide-format printing" as a sales opportunity, down from 31% six months earlier;
• only 9% of commercial printers saw "wide-format printing" as a sales opportunity, down from 12% six months earlier;
• no book or magazine printers saw any opportunity in "wide-format printing" in our spring 2006 survey.

To what extent does this translate into investment in wide-format printing equipment? Figure 2 shows the percentage of print and prepress firms that planned to invest in a wide-format printer in the 12 months following the survey. In spring 2006, we found that 11% of all establishments planned to invest in a wide-format printer-a level that has remained unchanged for the past year-and-a-half.

By market, we find that the "hot spots" for wide-format printers are prepress firms (21% planned to invest in one or more in spring 2006).

We find that in the general commercial printing and prepress markets, there is scant perception of wide-format printing as a potential profit center, and low to moderate investment in the equipment itself. This represents no small degree of opportunity for dealers and manufacturers.

We've always felt that commercial printers should be more interested in wide-format printing-and not just for proofing purposes. The magic word in advertising and marketing today is "multichannel" meaning that a wide variety of media are needed to aggregate an audience that has become increasingly fragmented by a plethora of media platforms, from print to e-mail to the Web to wireless devices to...you name it. Marketers and other content creators have diversified all the media used to reach potential customers, and wide-format is growing in importance. Data obtained elsewhere have found that marketers' spending on outdoor advertising-a key application for wide-format graphics-has consistently been growing at a time when spending on other print applications has been flat.

Today's successful commercial printers have realized that to survive, they need to provide a diverse range of service and product offerings to serve the full gamut of customers' needs. These services can range from non-print media, such as mailing and fulfillment and even non-print media development (like Web site design, direct e-mail campaign management and development, etc.) as well as other types of printing, such as digital and variable-data printing and, yes, wide-format printing.

As printers gradually morph into "marketing services providers," the emphasis in on becoming "masters of all media," with wide-format representing an important element of that strategy.

TrendWatch Graphic Arts provides the only ongoing regular market and industry trends based on original research with business owners and executives. TrendWatch Graphic Arts is a unit of Reed Business Information, a division with Reed Elsevier Inc. The twice-yearly Printing survey is based on a mail questionnaire sent to 1,500 U.S. print and prepress establishments, carefully segmented by employee size and primary equipment operated. Response rates are consistently at or around 20%.