2010 Hot Markets : Accepting the ‘New Normal’January 2010 By Vincent Mallardi, C.M.C.
Printing as we know it is declining, but hot new applications and markets should maintain our $200 billion revenue base in real terms. The overall economy, however, is sinking both into a double-dip recession and certain inflation in the New Year. Permanent diminishment of living standards and demand will become the "new normal."
Our industry's metamorphosis is evident in the magnitude of market shifts. Only three sectors within the top 25 will expand buys robustly at greater than 8 percent. Five other categories will demand between 4 percent and 8 percent more printing, while (ouch!) the remaining 17 sectors will be level or in decline.
By demand, the largest sector grouping will be foods/beverages, biting up 14.4 percent of total printing. Packaged foods ($968B, +8 percent; with more then $13.8B to print, +5 percent) is now the No. 2 buyer of print, feasting on labels, point-of-sale (POS) jobs and free-standing inserts (FSIs).
Bottled and canned foods leaders like Kraft (-6 percent) and Heinz (-5 percent) will fight lost share with increased advertising and brand acquisitions, while those like Goya (+20 percent) will cook up more ethnic varieties.
Agri-giants like Archer-Daniels-Midland (-5 percent) and Conagra (-3 percent), likewise, continue to move from the farm to the fork with downstream brand buys.
Feeding print will also be in-store aisle-end displays, shelf-talkers, coupons (including non-print telecom-delivered versions), FSIs, floor art and direct mail.
Most appetizing will be "very-smart" packaging for which large-format sheetfed providers must license the recipes. Boxes that sense consumer handling and content integrity, and respond with sounds and changes of color copy and backgrounds, will soon be on supermarket shelves—and should be produced on our presses, and not offshore or in in-plants.
Completing this grouping are No. 7 ranked beverages ($402B, +2 percent; with $10.0B to print, +2 percent) and No. 18 ranked food service ($712B, +2 percent; with $5.0B to print, +2 percent). Thermal-chromatic inks on cans and containers, and articulation and full-motion print in POS, will fizz and heat up these categories.
Fast-growth foreign brands like Foster's (+16 percent) will soon brew stateside, and increased consolidations at PepsiCo (-2 percent), Coca Cola (-4 percent), Diageo (-13 percent) and other parched players will pour out brand extensions to bloat shelf space.
Metal decoration, flexo labels and, especially, aseptic packaging in wines and juices will pop. New convenience food chains may be anticipated along with signage, FSIs, sanitary print and promotional items.