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Transpromotional Printing — Printing that Fills the Bill

October 2007 By Mark Smith
Technology Editor
Transpromo, adding marketing messages to bills/statements, is a rarity in today’s business climate—a printing segment that promises strong growth. Unfortunately, that spending is likely to come out of a company’s traditional direct mail budget. It’s also not clear if commercial printers are well positioned to compete for this business.

According to research done by InfoTrends, a Questex Co., color digital output of transpromo work totaled more than 1.6 billion pieces in 2006. It’s projecting the annual output to approach 22 billion pieces by 2010, for a 91 percent compound annual growth rate.

Several factors contribute to the bullish outlook for this market segment.

1) Bills and statements enjoy nearly 100 percent delivery and open rates, and consumers are interested in the contents, making this is a desirable target audience.

2) The majority of consumers have yet to embrace online billing and payment, so companies have to do these mailings. That makes them very motivated to offset the cost.

3) Recent changes instituted a very favorable postal rate for sending a second ounce at the First Class rate. This makes it very cost effective to increase the size of bill/statement mailings to accommodate marketing messages.

Although not yet a driving factor, there’s also the specter of proposed “Do not mail” legislation.

Working against these positives is the ingrained corporate mindset of being extremely aggressive on the cost of such documents. As a consequence, the per-page cost of full-color output can send potential users into sticker shock. They must be convinced that the conversion will have an ROI, which typically involves a long sell cycle.

Providing a turnkey solution is one method some service providers have implemented to overcome this resistance. In essence, they give customers favorable cost terms for production of the documents in exchange for the rights to sell marketing messages in the available white space.

There’s Work to be Done

While the demand side of the equation is decidedly positive, there are challenges facing commercial printers when it comes to being players on the supply side. There already is an infrastructure in place for production of traditional bills and statements, although just with good-enough print quality and not in full color. Since executing a piece requires mailing, database and variable data services, companies in those areas of the business are also sizing up the opportunity.

For the most part, printing system vendors believe the same devices will be suitable for both graphic arts and transpromo printing applications. Variable data software (commonly used by digital commercial print shops) plays a role, but the work is chiefly prepared in specialty applications from firms such as GMC Software Technology, Exstream Software and others.
 

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