Web-to-Print — The W2P Controversy

IN THIS political season, it’s all about watching the front-runners. Front-runners have the buzz. They get the attention. They have the sense of inevitability. In the world of commercial printing applications, it could be argued that the role of front-runner has been taken by Web-to-print (W2P). Move over 1:1 printing—since personalization has become sufficiently entrenched, the excitement mantle has now transferred to the W2P up-and-comer.

Not that W2P is new, but new in its current implementation.

But W2P has its share of controversy. It has been suggested that W2P is not taking hold the way the buzz would suggest. In fact, it has been suggested that, perhaps, printers should not be as quick to embrace these applications as the industry buzz would suggest. That has led to a backlash of criticism. After all, doesn’t everyone know that W2P is the way of the future? This is the way clients’ print and document management models are moving. Don’t printers that “lag” behind risk financial ruin?

It is true that, among very large corporate clients, adoption is rapid. According to The Industry Measure (Printing 26), among printers with 50-plus employees, 50 percent offer some kind of W2P solution, which is defined as static print/online store, site for creation of customizable/personalizable print jobs, or site for creation and distribution of advertising. These shops have large corporate customers for whom W2P provides clear bottom-line benefits. The cost efficiencies created in these environments are not in dispute. If printers serving these customer bases don’t deploy these systems, chances are, their customers will.

But the benefits (and urgency) for small- and mid-sized printers are much less clear.

According to The Industry Measure, nearly one-quarter (24 percent) of printing and prepress firms have the ability to offer W2P. This doesn’t mean they are actively deploying these applications; it just means they have purchased them. This number is identical to the percentage who gave this answer six months ago and is down 2 percent from one year earlier. So W2P reached a significant level of penetration 18 months ago but, according to this data, it has not grown since.

In other words, these firms believe that they need W2P, so they’ve made the investment. But once they have done so, they either don’t know what to do with it or, even if they do, they aren’t finding the reception they had anticipated.

Not One-Size-Fits-All

Vendors have tried to help the adoption process by developing more robust off-the-shelf solutions and ASP models to defray the cost. But while this lowers the bar-riers to entry, without the flexibility to customize to each client, there are limitations on who will buy into it. One-size-fits-all may suit the needs of many small- and mid-sized businesses, but not larger clients that support higher volume, higher margin applications. These clients require greater flexibility, more customization, higher levels of data security and redundancy, and greater IT skills, which rocket up the ante.

Thus, printers are finding that there is very little middle ground. They have either a low-end, off-the-shelf solution that is the same as another printer’s off-the-shelf solution. Or they have a more robust solution to serve larger accounts whose demands multiply the investment exponentially, both in cost and complexity—not necessarily in the software itself, but in peripherals like staffing, infrastructure, security and redundancy.

John Holladay, business development manager for Daniels Marketing Services, a digital printer and marketer in Asheville, NC, speaks for many of his peers when he says, “We understand the redundancy, data security and all of the other issues, which is part of the reason we haven’t adopted [W2P.] The software itself works well, but it’s the tertiary issues that cause us to go slowly into it. We have people internally who really believe in W2P and push it every chance they get. The second their argument becomes profitable, we’ll do it.”

Daniels Marketing Services has been on the leading edge of many of the industry’s key applications, including 1:1 printing, and it’s learned from past experience. In the early days of 1:1, for example, Daniels had a “VDP evangelist” whose job was to promote these applications. But while the company has had success with 1:1 printing, profitability has remained below its expectations. Thus, with W2P, it is moving more cautiously.

“We’re finding excuses to bring it up in conversation with customers who fit the profile [large corporations, those with remote offices, and with needs for just-in-time ordering and document management], and all of them say the same thing: ‘Hmmm, that’s neat.’ They are interested, but they aren’t excited enough to become a driver of adoption within their own companies,” reports Holladay.

“We want to be innovators,” he adds. “But innovation brings risk, too. Before you dive in, you have to be sure that profitability is there.”

This is where many W2P providers have fallen down. They have evangelists for the technology, but evangelism in itself isn’t enough. It must be paired with smart business projections. Beyond the simplest deployment, W2P requires the same kind of business plan that printers would put into any other major investment, such as the purchase of a new press or a new building.

This must include, not just adoption, but long-term implementation at the client level. Holladay’s point about “being a driver within the organization” is often overlooked. Adopters of W2P often report finding a disconnect between the recognition of the benefits of these applications at the management level and implementation throughout the organization.

Management may recognize—even be enthusiastic about—W2P, but if that enthusiasm doesn’t trickle down, the site sits unused. Thus, printers may lay out large upfront costs (which they may or may not fully recoup) on the promise of a certain level of print volume that doesn’t materialize.

This is why Howie Fenton, NAPL digital technologies consultant, sees a strong correlation between long W2P beta tests and long-term profitability. “Lack of customer buy-in is one of the subtle missing links in the success of most implementations,” he says. “That’s why successful implementers work closely with clients on the user interface or functionality before going live. They encourage customers to try the site, test it, and see what works and what needs to be fixed. If they include their clients’ opinions in the build out, they get feedback and ultimately the buy-in.”

The Greatest Challenge

This raises one of the issues that presents the greatest challenge for printers, regardless of application: the ability to market and sell applications rather than technology. On the issue of W2P, one software supplier describes the attitude of too many printers as like “sitting on the corner with their mouth open, waiting for a roasted duck to fly in,” then wondering why orders aren’t forthcoming.

This is why some printers have adopted W2P—not for its ability to produce applications, but as a workflow solution. It becomes a way to store, edit and order jobs that don’t require human intervention. But unless you have a Vista-Print model optimized for high volumes and standardized work (or you have a $500 system like some versions of PageDNA), you aren’t going to make back your investment quickly. This was the dilemma of printers back in the early days of CTP. It was expensive, and there was no way to pass along the cost.

This is not to suggest that there aren’t shops deploying W2P. Vendors insist that utilization is high. For example, Printable Technologies recently ran a report on its ASP Web-to-print solution to alert its internal staffers about any inactive accounts (defined by a certain number of orders per month per location). According to a Printable spokesperson, the percentage of “inactive” accounts was extremely low. But active accounts don’t mean high revenues. According to The Industry Measure data, more than 80 percent of all W2P users (even large firms) report that their revenues from W2P are less than 25 percent of overall sales.

The utilization rates, while strong enough to show up on W2P vendors as “active” accounts, are not high enough to register on competitors’ radar. Most are not being actively promoted or sold; so except for those few customers using them, nobody knows they are there.

This would explain the discrepancy between The Industry Measure adoption numbers (24 percent of all printing and prepress shops) and the perception that there are relatively few printers doing it. Anecdotally, Fenton says he puts the implementation rate closer to 5 percent to 7 percent.

“Both talks with clients and NAPL research tell us that many printers say they have W2P solutions when really they don’t,” he reveals. “They accept customer files attached to e-mail, files sent to an FTP site, or e-mail PDF proofs, and that’s what they call a W2P solution when it’s not. This only becomes clear when we follow up with phone interviews or ask more in-depth questions about specific features.”

Common Misconceptions

One common misconception (or over-simplification) about W2P is that it serves printers well in a niche market or if they have a single-source contract. This might be true in the short-term, but what happens if you make a significant investment and that customer brings W2P in-house? Or switches to another vendor? Or is under-utilized? The risk is great.

There is a perception that W2P locks customers in, since the printer is truly providing a business solution rather than merely “printing.” But looking farther out, what happens as more printers develop “business solution” expertise? How long before “locking in” is meaningless? Even leading-edge W2P providers have complained that they have already lost customers to lower-cost providers, even though their solutions were highly customized with their customers’ input. In the end, customers became hyper-pragmatic and price became a driving factor.

Thus, W2P remains a bit of an enigma. For some printers, it is a “live or die” proposition. For others, it is more complex—like an ocean with low waves, but swirling undercurrents. Some swear by it, crediting W2P with growing profitability and success. Others see it as important to their overall service portfolio, but are not relying on it for volume or margins.

If there is one consistent theme that does appear to span business models, geographic locations and attitudes, however, it is, at least, this: The subject isn’t simple anymore. PI

About the Author
Heidi Tolliver-Nigro is an industry writer and analyst specializing in digital technologies. She can be reached by e-mail at htollvr@aol.com.