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TransPromo Printing — Making a Strong Statement

May 2008 By Mark Smith
Technology Editor

Alternatively, a government entity may be interested in adding public service announcements (PSAs) or educational messaging components to their official documents to cost-effectively achieve a broader mission. Conservation tips and watering restrictions could be included on a municipal water bill, for example. This approach can be taken by other users, as well, such as a health insurer adding personalized wellness information to its statements.

“The barrier to entry for direct mail printers getting into (pure) transpromo is not trivial,” points out Pat McGrew, data center and transaction segment evangelist with Eastman Kodak’s Graphic Communications Group. “It’s more likely that the transactional printer would move into direct mail services because that transition is easier.”

In order to produce transactional products, printers need to support large-volume production using other data streams (chiefly AFP); meet security and auditing requirements such as SAS 70 and the Health Insurance Portability and Accountability Act (HIPAA); and likely sign a service level agreement (SLA) that includes fines for not getting pieces into the mail stream at the set time, McGrew adds.

It’s not out of the question for a graphic arts printer to make the transition, she says, citing the example of Fenske Media in Rapid City, SD. “It spent several years laying the groundwork to get a principally direct mail production environment set up to meet the requirements of transactional printing.”

McGrew believes there are opportunities for the average direct mail printer to move into transpromo printing for applications beyond the typical bill/statement containing personal information that must be so tightly controlled. Customer loyalty program “statement” printing is a prime example, she contends, adding that such programs tend to be big for hotels, casinos and big box retailers.

“These companies are more interested in using color and good design. They’re also more likely to be using a print stream (PCL or PostScript) that the direct mail printer is already handling,” notes the transpromo market evangelist.

Partnering Expertise

There may also be potential for a graphic arts printer to contribute its expertise to the implementation of a transpromo program, even if it doesn’t handle the output. A direct mailer can contribute color, design and marketing expertise, while the transaction printer deals with the data and security. “I have seen two companies marry their services and work in partnership, but they may need to present themselves as a single source to the customer,” according to McGrew.

Even given her role as an evangelist, McGrew falls into the more conservative camp in terms of the transpromo adoption rate. She sees the shift to producing “communication documents” potentially taking 10 to 15 years to become the norm. If a company doesn’t have the required infrastructure—including data mining, digital asset management and color expertise—implementation cycles can jump from the typical 12 months up to 24 to 36 months, McGrew adds.

To get beyond the confines of just a document that sells, she prefers to think in broader terms such as “integrated marketing” and pieces that inform, educate and enhance the communication experience with customers. McGrew believes graphic arts printers should take the lead in ensuring the pieces they produce work in concert with a customer’s other messaging vehicles, including Websites and transactional documents, to reinforce the desired overall message.

K/P Corp., San Ramon, CA, is another print service provider that is bridging the graphic arts and transactional printing market sectors. It’s admittedly on the larger side, with more than $75 million in annual sales, but not so big as to be a special case.

According to Thomas Middleton, vice president of information technology, the company has established its Sacramento plant as its “center of excellence for this type of transactional printing.” The facility works closely with Raine Media (the consulting arm of K/P), which has the marketing expertise to analyze a customer’s business and then deliver solutions to them.

Tri-Component Platform

Elements of the transpromo production platform the company has assembled include software (Exstream Software’s Dialogue), hardware (Océ, Xerox and HP Indigo presses) and security components (including background checks and drug testing of employees). “We’ve spent millions on our infrastructure to be able to support this market,” Middleton notes.

K/P has a range of commercial printing capabilities across its six plants, including 40˝ sheetfed and Didde web presses. It also has mailing and secured fulfillment operations.

Along with echoing the challenges in meeting security requirements, Middleton stresses the importance of being able to bring together the CIO and CMO (chief information/marketing officer) perspectives on the customer side. Raine Media aids with that requirement.

Helping customers recognize the opportunity that transpromo represents is really challenging, agrees Glenn Morgan, K/P’s vice president of operations. Within organizations of the size that would be likely candidates, there typically isn’t the level of communication required between the IT and marketing departments, he believes.

“The customer’s CMO may hear about transpromo and go to the IT department, only to have the IT staff respond, ‘We don’t have time for this. We have millions of transactional documents that have to go out every week, and you want to muddy it up by trying to put a marketing campaign into it?’ That is where our solutions consultants can step in and, with an understanding of the requirements on both sides, be more of a facilitator within the customer’s organization.”

Creative Inspiration

Suppliers need to have the marketing expertise to come up with some examples to get the client’s creative juices flowing, Morgan continues. He also reiterates the importance of having a proven ability to keep sensitive data secure, as well as a robust IT infrastructure that can integrate the transactional and marketing data streams.

K/P offers another production option that is easier to implement, but Middleton contends it still qualifies as transpromo. Using the Exstream Dialogue software, it can run out statements that contain a two-dimensional barcode and then load them into the plant’s 10-bin intelligent inserter. That machine reads the barcode to direct the insertion of versioned brochures into the envelope, along with the statement, based on selected criteria and data elements.

Although on a somewhat smaller scale, the story is much the same for Lewis Creative Technologies, a commercial printing (digital and offset) and mailing operation, and Research Data, its data management and direct marketing arm, both based in Richmond, VA.

Keith Bax, vice president of both companies, says he sees a huge opportunity for transpromo, but cost and organizational issues can be stumbling blocks with prospects. “Most operations managers in Corporate America are unwilling or unable to champion a new way of using statements for promotional purposes, if there is an increased cost to do so,” he reports. Even if color printing costs drop as expected, the large organizational effort required to redesign and implement new statements and bills will remain a hurdle, Bax adds.

The organizational issue also relates to cost, in the sense that companies are not set up internally to share the wealth when transpromo turns profits from this former cost center, he explains. “Operations (IT) seems unwilling to take on the additional cost of moving to variable color digital printing, and marketing seems unwilling to internally transfer the advertising revenues that result from transpromo activities.”

On the supplier side, Bax points out that variable information printing solutions designed for “promotional” pieces may be able to execute smaller, less complex transpromo projects, but specialized software is needed to handle the transactional data volumes and mailing requirements of higher-end programs. “As these projects become larger and more complicated, companies will need to look at bolstering their IT infrastructure—people, software and hardware,” he says.

It definitely helps to be positioned as both a marketing and IT solutions provider, and establish a relationship with each department in a corporate setting, Bax continues. “In order to be successful in transpromo, a solutions salesperson needs to understand both sides (IT and marketing) of a client’s business. Such people are in short supply.”

Transpromo is far from being a solution in search of a problem, but its adoption is going to take work on the part of service providers and customers alike. Both will need to think creatively to develop this business opportunity. PI


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