Print Prices are Rising – Will Value Follow?
In the year 2000, I was leading an in-plant print and mail operation in Boston. We had invested in the latest technology in color printers and high-speed inserters. The team was excited when we installed equipment that printed at speeds of 80 color pages per minute, and inserted envelopes at 6,000 pieces per hour. While I don’t recall my mailing costs, I remember the excitement of printing color at only $0.25 per page.
The last two decades have seen radical changes in document production. Inkjet printers run at over 600 feet per minute – or more than 2,400 pages! – and inserters are processing 30,000 pages per hour. With the new speeds and technology, color print can be as low as $0.013 per page, and inserting at $0.005 per envelope.
Faster printers and inserters lowered the relative labor costs. What took three operators running three machines became one operator at one workstation. While the best companies paid competitive wages, there wasn’t a lot of competition for the skillset.
However, costs have begun to shift in the other direction. The last year has seen a dramatic rise in the price of paper, with the PPI increase of 50% in the last year. Experts predict these high prices will continue into the second quarter of 2022.
The pandemic and the growth of internet shopping have impacted the labor market. Employees who were considered “essential” during the lockdowns of 2020 are reconsidering their options. Amazon warehouses are hiring entry-level workers at above minimum-wage salaries. Organizations will have to pay more for employees.
To add to the increasing costs is the postal pricing methodologies of the US Postal Service (USPS). Beginning in 2007, increases in postage rates were tied to the rate of inflation. The Postal Regulatory Commission adopted rules that allow the USPS to implement increases above inflation. Under Postmaster General DeJoy, the USPS is committed to taking advantage of this new rate authority, and 2021 saw two postage rate increases – a practice that will continue in 2023.
Higher paper costs. Higher labor costs. Higher postage costs.
Will higher value follow?
Through the power of big data, marketers can target their intended audience with precision. Coupled with advanced document composition software, that uniqueness continues on the printed piece. Workflow software electronically combines and commingles files. Shorter runs with personalized messaging at the same production speeds.
The power of data continues during the mailing process. Inkjet printers personalize envelopes. USPS Informed Delivery adds a visual, digital, internet-enabled message to the recipient. QR codes on the physical piece unveil an augmented reality experience. Additional digital messaging – text, email and social media – are timed based on data from USPS Informed Visibility.
Savvy marketers understand that customer communications aren’t physical OR digital, they are physical AND digital. The printed piece is transformed from just an expense – to the keystone of an omni-channel marketing campaign. Adding value, every step of the way.
Input for this piece was provided by Lois Ritarossi, CMC®, President of High Rock Strategies:
Lois Ritarossi, CMC®, is the President of High Rock Strategies, a consulting firm focused on sales and marketing strategies, and business growth for firms in the print, mail and communication sectors. Lois brings her clients a cross functional skill set and strategic thinking with disciplines in business strategy, sales process, sales training, marketing, software implementation, inkjet transformation and workflow optimization. Lois has enabled clients to successfully launch new products and services with integrated sales and marketing strategies, and enabled sales teams to effectively win new business. You can reach Lois at highrockstrategies.com.
Mark M. Fallon is president and CEO of The Berkshire Company, a consulting firm specializing in mail and document processing strategies. The company develops customized solutions integrating proven management concepts with emerging technologies to achieve total process management. He offers a vision of the document that integrates technology, data quality, process integrity, and electronic delivery. His successes are based upon using leadership to implement innovative solutions in the document process. You can contact Mark at email@example.com.