Transpromo Printing — The Message Is the MediumAugust 2009 By Mark Smith
The printing industry seems to keep looping back a year when it comes to certain major developments. This is particularly true for digital printing, come variable data, which was the “next big thing” in the industry for about a decade before the adoption rate even started to approach the robust expectations.
Combined transactional/promotional (transpromo) printing is the latest case in point. It burst onto the graphic arts scene a couple of years ago and was quickly christened the “next big thing.” Jaw-dropping numbers have been tossed around as the market potential for this new business segment.
And so it has gone in the printing industry each year since.
There is a compelling financial case to be made for tranpromo, to be sure. As with incorporating variable data into direct mail, though, presenting even what would seem to be a no-brainer ROI far from guarantees that a prospective user will, or can, buy into the concept.
Adding a promotional/marketing component to data-intensive, transactional documents or statements, can be thought of as the mirror image of exploiting customer databases and variable data printing capabilities to enhance the marketing in direct mail. It brings similar business potential and all the same challenges, plus some more.
Accuracy, legibility, timely delivery and lowest possible cost are the key drivers of statement printing, although the ability of the recipient to comprehend the piece has been given greater weight with improvements in technology and dramatic growth in the number of people receiving financial reports for their investment and retirement accounts. Security, to ensure privacy and identity protection, is a paramount concern at all production stages.
Don’t Pass Over IT Folks
One of the early lessons learned in selling corporations on the variable data marketing concept is the importance of starting with high-level marketing people, but bringing the prospect’s IT department into the discussion as soon as possible. The added challenge here is that there are established transactional printing specialists that are going to have the inside track for capturing transpromo opportunities.
While not impossible to overcome, the barriers to entry for new players are steep in the traditional statement printing sector. Where the more accessible opportunities may lie is in potential outsourcing for higher-value color printing and expanding the definition to include more types of business documents.
Nothing says that transpromo printing can’t be done on the black-and-white and spot color digital printers that produce the vast majority of these pages. There’s no question that color does sell, though.
The latest generation of high-volume, color ink-jet printing devices are being positioned by the vendors as enabling this application because of their speed, resolution and cost per page. Océ North America, Kodak, InfoPrint Solutions, Screen (USA) and Agfa Graphics have commercialized solutions they’ve been actively selling, and HP is also targeting the transpromo sector with its soon-to-be-released ink-jet web press. RISO sees its entry-level ink-jet printer as suited to this application, as well.
The big machines are priced in the $1 million to $5 million range, which is a daunting investment under any circumstances, let alone in a down economy. Meeting a client’s needs via a partnership can be tricky, but may be an option that transactional printing operations with limited color printing capabilities will consider.
Outsourcing pilot transpromo programs, while building sufficient volume to justify investing in a color press, is a much lower risk way to enter the market. Also, the ROI benefits of segmenting the target audience by customer value, and investing more in the group that accounts for the most revenue, is another lesson learned in selling data-driven marketing programs. Platinum credit card holders, fliers in the highest airline mileage category and the like may warrant employing higher production values, also potentially through outsourcing, in the communications sent to them. Once marketers get involved with these documents, production quality demands are only going to increase.
Such scenarios would require a tight working relationship between suppliers and a great deal of trust. Meeting the customer’s data security requirements could be a challenge since certification via the Statement on Auditing Standards No. 70, Service Organizations (SAS 70), is a de facto requirement for transactional printers.
Along with having digital color devices in place that may offer glossier, higher-resolution printing and greater substrate flexibility, more mainstream digital printing operations can also bring marketing expertise and contacts to such business relationships. They likely also have resources for response handling and tracking, asset management and the Web-to-print workflow that is now being adopted in transpromo applications.
In a reversal of the situation with direct marketing, buyers of transactional printing services have the customer database, but may not have the marketing component in place. This has led to the introduction of terms such as trans-educational and trans-informational. The idea being that prospects may have other needs, such as communicating information on retirement planning, identity protection or wellness and diet, that serve the greater goals of the organization.
Broadening the Definition
The “trans” part of the term is also being extended to open up the business opportunity to a wider community, on both the customer and supplier sides. To put it simply, this model suggests that any routinely mailed business document can be seen as a transpromo prospect. The goal can be simply to offset the cost of doing a required mailing, especially in the government arena, or to develop a new revenue stream.
This is one case where the printing industry can steal a page from the Website business plan. The “print” option on Websites originally was conceived as a way to strip out unneeded components and to reformat the information so it is printer-friendly. Now, more companies are capitalizing on it as a marketing opportunity and incorporating ads, coupons and messaging into the “for printing” version of the Web page.
Checking in online and printing an airline boarding pass is a great example, since most now carry ads for rental cars, hotels, restaurants, etc., but any order confirmation page is apt to adopt this marketing technique. Equivalent printed and mailed documents that have been cited as potential applications include appointment (veterinarian, dentist, etc.) and servicing (automobile, home maintenance, etc.) reminders, loyalty programs, club membership renewals, fundraising mailers and the like.
Yet another lesson learned from the efforts to develop the data-driven marketing industry is that service providers typically need to spoon feed the concept to prospects. Potential users often don’t get it until they are shown an example of how one of their direct competitors has implemented the marketing approach, or are presented with a mock-up that is specific to their market and customer base.
At some point in her presentations, Pat McGrew, data center & transaction segment leader in Kodak’s Graphic Communications Group, usually has to explain why her examples are predominately from foreign countries. It’s not that this type of work isn’t being done here, she says, but U.S. companies are resistant to go public with the details of such programs.
Coming up with examples to show prospects will be a challenge, and likely come down to service providers investing their own marketing resources. The CMO Council and InfoPrint Solutions have been collaborating on a series of transpromo pilot programs. In their latest effort, they are focusing on loyalty and rewards programs, the results of which they will start sharing later this year.
Unfortunately, there may be yet one more lesson learned in data-driven direct marketing that will apply here: programs have a long sell cycle. Don’t be surprised if the industry loops back again next year, and transpromo is the next big thing in 2010. PI