The Future of Direct Mail, Transaction and Transpromotional Documents

Transcription

1 The Future of Direct Mail, Transaction and Transpromotional Documents Data Center Printing Market Opportunity Transaction Documents The TransPromo Opportunity Electronic Presentment Direct Mail Direct Marketing Trends Headquarters 97 Libbey Industrial Parkway Suite 300 Weymouth, MA Europe Sceptre House, 7-9 Castle Street Luton, Bedfordshire, United Kingdom LU1 3AJ Asia Hiroo Offi ce Building Hiroo Shibuya-ku Tokyo Japan info@gsm.to

2 This study examines the future of direct mail and transaction documents in the United States. It is a follow-up to our landmark 2003 study entitled The Future of Mail and Transaction Documents and our 1997 study entitled The Internet and the Future of Transaction Documents. This study is designed to provide statistically signifi cant data to print providers; companies that sell printing, fi nishing, and mailing equipment; software providers; and businesses that provide alternate services such as electronic bill presentment. The fi ndings will also be of interest to providers of CRM (Customer Relationship Management) tools, providers of paper and pre-printed forms, and those who sell printers to the consumer market. This study focuses on customer-facing applications such as direct marketing, billing, and related issues such as customer support and fulfi llment. It will investigate consumer behavior and preferences, discuss print provider expectations, and review the plans of those who generate these documents. Introduction The health of the printing industry is heavily reliant upon direct mail and transaction documents. InfoTrends has forecast continued growth for direct mail printing at rates above the overall market. Transaction documents are forecasted to decline slightly, but from a large base. With the impact of privacy legislation and the continued adoption of the Internet, it is critical to gain an understanding of the future of direct mail and transaction markets. Those who generate these documents have an increasing number of choices in how this information is delivered. In addition to printing, there is the Internet and portable devices. Most organizations face continued competition and constrained budgets, and must communicate in the most effective ways. Those that receive these documents have preferences as well, and this study will provide insight on how these two sets of dynamics will impact the market. As our last study indicated, direct mail is the preferred direct marketing approach, with 69% of respondents stating a preference for direct mail over other types of direct marketing. We believe that direct mail can be examined from two perspectives direct mail that is designed to acquire new customers and direct mail that is designed to retain or up-sell existing customers. Retention direct mail can more easily meet the requirement from our last study that the mail be highly personalized, as the originator should know more about the recipient. Transaction documents are vital links between critical business processes and desired outcomes. They fuel the transfer of funds and ensure cash fl ow. Invoices and statements are the ultimate mission-critical documents. As such, they are the one piece of mail that is almost always read. Organizations are investigating new and more effi cient means of producing and distributing these documents, and this has resulted in a new category that combines direct mail and transactional called transpromotional. The adoption of transpromotional documents could transform the existing document landscape. Printing is being eliminated in some applications, and distributed in others. In still other cases, documents are being built to order based on real-time data and printed or distributed in other ways to recipients. Some users are outsourcing production to professional services fi rms while demanding increased security and wider output choices that integrate more tightly with their core systems while others are continuing to invest in internal production capabilities. This evolution provides new opportunities for document technology vendors of printing and fi nishing equipment, as well as providers of software enablers such as document and content management and electronic presentment. It also offers a tremendous opportunity for print service providers in the document outsourcing arena to assist customers in migrating to more productive and effi cient operational strategies relative to transactional data fl ow.

3 CORPORATE TRANSACTIONAL DATA FLOW Revenue Profit EPS (Shareholder Value) Delivery: Web Print Fax Postal Mail Courier Time to Market Cost Savings Productivity Control Purchase Orders, Financial Statements, Reports, etc. Internal/Supplier-Facing ERP Systems BUSINESS INTELLIGENCE Invoices, Statements, Reports, Customer Support, Marketing/Sales Customer-Facing (CRM) Business Strategies and Objectives Customer Retention Customer Loyalty Customer Satisfaction On one hand, this study will evaluate the transitions that are underway in the corporate world relative to transactional data fl ow. On the other hand, the study will consider the longer-term effects of recent events on the perceptions and practices associated with the creation, management, and distribution of transaction documents. Additionally, this study will examine industry trends that have evolved since InfoTrends previous studies. The overall objective of this study is to provide document technology vendors and service providers with critical information to guide the development of product/service portfolios and strategic business planning that is designed to capture revenue from direct mail and transaction-based document applications. The study will examine the impact and opportunities for document technologies and services created by the increasing pervasiveness of the Internet as a business tool, the adoption of Customer Relationship Management (CRM) solutions and electronic document delivery programs, and the increased availability and accuracy of customer data in medium-sized and large companies in select vertical industries. Why is this important? Direct mail and transaction document volume drive output in what we defi ne as the data center print environment. The retail value of digital print produced in this environment was estimated at $4.6 billion in Digital printing equipment revenues, services, and direct supplies (excluding paper) are estimated at close to $2.2 billion. InfoTrends annual U.S. Market Forecast defi nes the data center print opportunity as digital printing functions that support computer-based information processing tasks. Most of this printing is for mission-critical functions such as reports, transactional statements, process documentation, or direct mail. These processes take advantage of printers with the primary function of printing host/mainframe data. Our forecast currently considers only monochrome and spot color devices. All full color devices are covered in the Print On Demand forecast. Of course, some direct mail and transaction documents are produced in what we classify as Print On Demand environments that are more closely aligned with graphic arts. Graphic arts environments are those where the primary business objective is to produce printed products with high graphic content. These establishments are operated on a print-for-pay basis (i.e. commercial printers, quick printers, service bureaus, or digital service providers), as well as those where printing is considered a cost center (i.e. corporate reproduction groups, in-plant print departments, or marketing communication departments). These user environments typically have dedicated, skilled operators using a variety of hardware and software tools to produce visually refi ned, high-resolution, formatted, completely fi nished documents. Companies in graphic arts environments currently dominate the print-on-demand market, and we count all full color devices in this category.

4 Our recent study of 516 commercial printers (The Changing Print for Pay Market: The Future of Commercial Printing) indicated that 7.7% of their print volume was related to transaction documents. Promotional documents, including direct mail, accounted for about half of total volume. In our study entitled The Evolving U.S. Digital Color On Demand Printing Opportunity, we found that owners of digital color production printers currently attribute 17.4% of monthly print volumes to direct mail and only 2% to transaction documents. Project Objectives: 1. Identify the current state and future prospects for transaction documents, transpromotional documents, acquisition direct mail, and retention direct mail. Page growth Revenue growth Color content (monochrome, monochrome/pre-print, spot color, full color) Types of mail (self-mailers vs. standard and fl at envelopes) 2. Understand how key IT and organizational initiatives are affecting user requirements for document production and distribution technology and services E-Business Initiatives ERP systems CRM solutions Content and document management Electronic presentment and other distribution alternatives 3. Determine customer requirements and the rate of adoption for document technologies and services in key industries Financial services Government/Education Healthcare Manufacturing Retail/Wholesale Transportation/Utilities Business services 4. Assess customer awareness and vendor plans for supporting key technologies XML PDF JAVA AFP Automated Document Factory JDF Legacy print streams

5 5. Assess market opportunities for print technology Consumer printers Mid-range black & white devices (40 to 79 ppm) High-speed black & white devices (80+ ppm) o High-speed cut sheet and roll-fed devices Spot color solutions over 50 ppm Digital full color devices o Less than 24 ppm o 24 to 59 ppm o Over 60 ppm 6. Assess market opportunities for print-related solutions Output management solutions Print data stream conversion solutions Automated document factory solutions 7. Assess market opportunities for feeding and fi nishing solutions in support of digital printing print-related solutions 8. Assess the changing requirements of consumers segmented by typical demographics, those with or without Internet access, as well as those with high-speed Internet access. 9. Profi le current and future value-added document services offered and determine the market size and growth potential for each ( ) Consulting Software integration Output management Fulfi llment Storage, archiving, and disaster recovery services Presentment Personalization and customization Document and content management Image and records management Database and hosting services Direct marketing 10. Identify and profi le the leading suppliers for enterprise document systems and services Hardware Software Consulting Integration Outsourcing o Statement printing o Contracted printing o Facilities management o Direct mail fi rms

6 Market Research The research will include discussions with document owners and print buyers to determine the current and future plans for direct mail and transaction documents. We will survey these two groups separately with at least 200 respondents in each category. With each group, we will gain an understanding of the transpromotional opportunity. We will conduct research with at least 300 print providers who service these markets to understand their beliefs and quantify purchase plans. We will also conduct in-depth interviews with representatives of the direct marketing industry, print vendors, large corporate users of document technology, the USPS, and other relevant parties. Additionally, InfoTrends will interview and profi le infl uential technology developers and service providers to understand the market size and product development directions. Also included in this study will be interviews with at least 400 consumers (end-users) to uncover trends and preferences relative to transaction document delivery methodologies, including adoption rates for online services as electronic bill payment, investment transactions, and other customer self-service opportunities. This research will also obtain insight about preferences and the use of direct mail. It will also test the effectiveness of personalization and the use of color. Ultimately, the research will identify critical success factors; unmet customer requirements; purchase plans; and other items that will drive the vendors and service providers product, service, marketing, and sales activities. Desk Research InfoTrends will thoroughly examine existing market information on key applications, market segments, competitors, and product categories. We anticipate utilizing a variety of sources that include: Industry trade associations Government agencies Published industry reports Bureau of Labor Statistics Periodicals and trade articles Industry databases Web sites Vendor white papers User groups Research reports InfoTrends will also review research it has previously published as part of its Continuous Consulting Services and Multi-Client Studies. Relevant research reports include: A Vertical-Market Approach to Document Services in the U.S.: The Evolution from Printer to Partner Multi-Channel Communications: The Content Publishing Workfl ow Challenge The Evolving U.S. Digital Color On Demand Printing Opportunity Document & Content Solutions: The Professional Services Opportunity Document Process Outsourcing: Business Strategies for Successful Market Engagement The Changing Print for Pay Market: The Future of Commercial Printing The Global Print Production Workfl ow Market: Enabling Fundamental Business Change in Graphic Arts Content-Centric Collaboration: The Business Drivers and Technology Needed to Support Content-Centric Collaboration

7 Ink Jet Addressing and Personalization: Overview and Outlook, 2004 Creating the Conduit for Multi-Channel Communication Corporate Print Services: The In-Plant Printing Opportunity Print On Demand Quarterly Market Data Tracking Program The Future of Paper The New Corporate Print Customer: A Profi le of a Market in Transition The Future of Mail and Transaction Documents Black & White Print On Demand: Catching the Next Wave The Internet and Future of Transaction Documents Personalized On-Demand Printing and Publishing One to One Communications: Delivering a Personalized Message Practice Of Knowledge Management Global & North American Print Production Workfl ow Software Market Forecast: U.S. Print On Demand Market Forecast: U.S. Document Outsourcing Forecast: U.S. Printing & Publishing Market Sizing: Vertical market reports Print/Mail Service Provider Interviews Over 300 Service provider and vendor interviews will be critical in assessing the current state and future direction of direct mail, transaction, and transpromotional documents. Existing capabilities and planned investments will be covered in detail, as will strategies, pricing trends, and perceptions on unmet market needs and emerging opportunities. Service Providers Statement printers/service bureaus Direct mail fi rms Commercial printers including digital and quick printers Forms printing & management In-plant data centers and printing establishments Of particular focus will be page volume trends, color use, equipment and solution purchase plans, and overall requirements. Document Owners and Print Buyers At least 200 in each category InfoTrends will conduct a series of structured interviews to develop industry statistics on current use and future plans concerning direct mail, transaction documents, and transpromotional opportunities. We will obtain data on adoption plans and their impact on print volumes, unmet needs, new service requirements, and other factors affecting document technology and service purchases. These will span key industries and focus on each application separately. The interviews will enable detailed market sizing, projections of demand, and other quantitative information that is critical for business planning.

8 Consumers/End-Users At least 400 InfoTrends will conduct a series of structured interviews with consumers to evaluate receptivity to various communications alternatives, including a number of questions designed to measure receptivity to electronic presentment and direct marketing preferences. These surveys will provide wide demographic coverage in terms of age, gender, geography, income, and Web use. They will include mall intercepts and provide cross-tabulated data on those with and without home Internet access. This survey work will identify how and where statements and invoices are printed. We will also test the effectiveness of personalization and color with this group. Personal Interviews with Leading End-Users - 15 An essential element of the project will be extensive primary research to address issues that previous industry analysis has not covered. The primary research will include a series of in-depth personal interviews with medium-sized and large companies that produce transaction and direct mail documents. The research will span key vertical industries and will include companies that have undertaken transpromotional initiatives and some that have not. Analysis and Project Deliverables InfoTrends will conduct extensive analysis of the desk research, personal interviews, and surveys to develop a comprehensive understanding of the opportunities and issues for document technology and service providers. Technology Providers Clients will receive a combination of reports, presentation materials, and data for senior management, product managers and planners, and sales and marketing executives. The material will include: An Executive Summary that addresses key issues, fi ndings, and overall recommendations A detailed written report (approximately 300 pages) with text, charts, and graphs addressing the objectives of the study A detailed equipment forecast including revenue, service, and supply revenue by category A PowerPoint presentation for internal communication of the research results Extensive data books with cross-tabulations of the survey results for additional analysis of key questions and market segments Service Providers Service providers will receive a detailed written report (approximately 300 pages) with text, charts, and graphs addressing the objectives of the study. Key elements will include: Profi les of key vendors and solutions relevant to the transaction printing, mailing, and direct marketing industry Market segmentation and opportunities for print services providers in the production of transaction and direct marketing applications, by vertical industry and document type A discussion of the key elements of a business plan for providers considering entry into, or expansion of services within, the transaction printing, direct marketing, and opportunities for transpromotional marketing Profi les of successful providers in this market space A specifi c market forecast for outsourced services

9 Corporate End-Users Corporate end-users will receive a detailed written report (approximately 300 pages) with text, charts, and graphs addressing the objectives of the study. Key elements will include: Profi les of key vendors and solutions relevant to the transaction printing, mailing, and direct marketing industry Consumer preferences Profi les of leading companies Project Schedule InfoTrends intends to begin this project in May Based on the following schedule, the project will be completed with material distributed by September Throughout the project, InfoTrends will issue regular updates on the project status. Early study sponsors will have input into the development of the interview guides and will help shape the overall study. They will also receive a copy of our previous study entitled The Future of Mail & Transaction Documents at no additional cost. (A $3,495 value.) Milestone Completion Week(s) Desk research, development of survey guides: 1-4 Interviews with industry leaders 3-6 Personal interviews with end-users and leading companies 5-8 Survey work 7-11 Data analysis and report development 9-15 Report delivery 16

10 Acceptance The Future of Direct Mail, Transaction and Transpromotional Documents I would like further information. Please have a representative call. Please enter my order as follows: Technology Provider - Primary business is printing equipment manufacturer, software and systems vendor, paper manufacturers, and equipment and supplies distributors Early subscriber (before 5/31/06) $13,995 Subscriber (after 5/31/06) $14,995 Personal presentation $ 2,500 plus travel expenses Service Provider - Primary business is direct mail printing, quick printing, corporate print facilities, commercial printing, facilities management/outsourcing provider, data center service bureau, fulfi llment company, or carrier Early subscriber (before 5/31/06) $ 5,995 Subscriber (after 5/31/06) $ 6,995 Personal presentation $ 2,500 plus travel expenses Corporate User Producers of transaction and direct mail documents who want to better understand customer requirements and best industry practices. Early subscriber (before 5/31/06) $ 1,995 Subscriber (after 5/31/06) $ 2,995 Personal presentation $ 2,500 plus travel expenses Purchase order number: Signature Name Title Company Address Address Address Telephone Fax