IN 2002, I spoke at an industry gathering lamenting the dwindling profit margins in the printing industry as a result of the post 9/11 economy, the post-Y2K phenomena and the then-new concepts of e-commerce, reverse auctions and corporate RFIs. I was cautiously optimistic about an economic recovery, but concerned that we, as an industry, would not be able to harness the momentum behind a recovery and convert it into growth and profits. Well, the recovery did come and, unfortunately, in most ways we did not seize the opportunity. While many of the processes for transacting business in the new digital era fell by the wayside, the digital era has created many new products. Whereas six years ago, we saw those processes as significant impediments to our growth, today the new products are threatening our future. And, just as I argued then that we needed to change our ways, once again, we need to reinvent ourselves in order to stay relevant.
Today’s challenge, or more realistically threat, is not to preserve profit margins in the face of competition from other competitors within the printing industry, but to keep print relevant in the face of the challenges that exist from a plethora of alternative mediums, all competing for a piece of the ever-shrinking marketing and communications budget.
The printing company down the road, across the country or even the one in China is no longer our biggest competition. The competition is now other media options.
The practices of trying to react to the old competitive threats by lowering prices, increasing output or cutting overhead, will not work in the new paradigm. We have to find new ways to meet these new and very formidable challenges. And the reality of the situation is, that based on past experience, our industry does not have the best track record for meeting such challenges on our own.