Diversification Opportunities -- Crossing the Digital Divide

by chris bauer

Managing Editor

Digital printing has been tabbed as the future of the graphic arts industry for years now. But, to the chagrin of digital press manufacturers—and probably to the delight of offset press vendors—their use and integration into pressrooms remains relatively limited.

Whether it is concerns of quality, price or technology, many commercial printers are sticking with their traditional offset presses, and using digital presses for special applications only—if at all. Those printers who have made the digital leap, however, are singing the praises of the new-found equipment. Many report seeing a bump in business after crossing that digital line, and are finding new ways to make digital printing profitable.

One company that has successfully made the move to digital printing is USA MailNow, a York, PA-based direct mail provider (and a division of USA Direct). The firm is helping its customers develop more effective, customized direct mail campaigns in as little as one week instead of 90 days by using digital color presses.

According to Richard Osborne, CEO of USA MailNow, the company has been transitioning from its traditional printing processes toward "the future of direct marketing." It offers customers support for print-on-demand documents, personalization and shorter print runs, helping clients develop campaigns with more timely and relevant messages.

Web Driven

To deliver those benefits, the company uses a Xerox DocuColor 2060 and a DocuColor 6060 in combination with its own Web-based MailNow solution, a service that helps businesses create, edit, order and ship direct mail campaigns.

"The presses are producing high-quality color printing in runs from 500 to 50,000 pages, with an overall combined monthly run rate of more than 500,000 pages," Osborne reveals.

In 1999, the company began developing MailNow software with a goal of using the Internet and advancing technology to increase the efficiency of the print production process and the effectiveness of direct mail, he explains. At the same time, clients were increasing their demand for short runs with targeted messages.

"When we began beta testing the prototype of MailNow in 2001, we teamed with Xerox to include digital presses and print-on-demand into our strategy," Osborne recalls. "When we formally incorporated MailNow into our business model in 2002, client demand for digital and on-demand printing began immediately and has increased every month since."

USA MailNow works with its customers to build customized MailNow Websites that contain approved corporate-branded content, direct mail packages and legal information. Authorized company officials on the local level can access these sites and select and edit their direct mail pieces within guidelines established by the corporate office, eliminating the need for lengthy review cycles.

For example, USA MailNow developed an international corporate direct marketing Website that allows more than 2,500 John Deere dealers to create customized direct marketing campaigns completely online. The site includes postcards and multi-page direct mail templates featuring photographs of products ranging from chainsaws to riding tractors. Copy areas allow retailers to personalize the direct mail pieces to their local market, and an extensive database of prospects allows dealers to select mailing lists based on details such as income and number of acres of land.

Digital, Traditional Growth

These perks offered to customers have paid off, notes Osborne. "MailNow has generated growth in both traditional printing and digital printing. Digital printing increased by 103 percent during the last year and now accounts for 25 percent of our business.

"Customers always have quality concerns," Osborne continues. "However, MailNow tools give them better control by providing real-time content review of the project, edits and changes, as well as an electronic signoff process. Customers are supplied with our print quality control procedures and provided with live print samples upon request. This process has virtually eliminated client press checks on digital work."

Direct mail is a hot area for the printing industry in general and digital printing specifically. The Instant Web Companies (IWCO), headquartered in Chanhassen, MN, is a prime example. It provides integrated direct mail solutions, including creative services, web printing, data processing, personalization, mailing and logistics management. IWCO offers the total package, which could include a form, inserts, business reply card, plastic loyalty card, envelope, color and personalization.

IWCO wanted to consolidate its lettershop services to support the expansion and diversification of its total package direct mail business to offer a wider range of services more effectively. Three separate manufacturing platforms—print, envelope and mailing—were combined into one operation.

"We realized there would be immediate and significant cost benefits for our customers by eliminating redundancy," says Jim Leone, vice president of operations.

Two Océ VarioStream 7650cx twin pinless systems have helped IWCO centralize resources, increase capacity and expand its personalization offerings. "Before we added the Océ equipment, duplexing and MICR personalization were bottlenecks," Leone admits. "Now we can pursue larger blocks of this business—which carries a premium in the marketplace—by enabling more targeted messages for our clients."

Today IWCO consistently produces 80 million total personalized packages a month. Digital solutions provide the high-volume, leading-edge printing capabilities that help IWCO add distinction to its customers' direct mail campaigns, complement traditional printing services, and increase the company's competitive offerings and revenue growth.

Another traditional printer that now depends on digital output is Parker Pad and Printing, located in Toronto.

Parker Pad and Printing is a third-generation firm that was started in 1946 by Frank Parker Sr. with an original letterpress machine in the basement of his home. The company grew steadily each year, adding several Heidelberg offset presses and other equipment to become a full-service printing and finishing operation.

As customer needs changed and workflows evolved, the move to digital systems was inevitable, notes Janis Parker, company vice president. Today Parker Pad offers fast-turnaround short runs on a Heidelberg Digimaster, a NexPress 2100 and other digital solutions.

Record Setting Output

In fact, Parker Pad and Printing recently established a new North American record for digital print volume on a NexPress 2100. The company produced 1.49 million full-color A4-sized impressions in November 2003, representing an average output of nearly 75,000 prints per business day.

"From a production standpoint, the advantages of printing on multiple substrates and outputting already-collated documents gave a huge boost to our overall productivity," Parker lauds. "In fact, we were able to bind at the same speed as we printed."

Among the high-volume projects produced in November 2003 were several for General Motors of Canada. The NexPress was able to meet GM's high standards for print quality and reproduction accuracy—and deliver thousands of finished books to meet GM's needs, Parker concludes.