Print in the Digital Age
How Minnesota's printers are finding ways to adapt within a shrinking industry.
BY ANDREA LAHOUZE
With its dense forests, countless waterways, large paper mills and Midwest locale, it's no surprise that Minnesota has been a printing mecca since the turn of the 20th century. The state's printing industry has long remained the fourth largest in the country after only
Chicago, New York and Los Angeles. Printing is the second-largest industry in Minnesota's manufacturing sector, accounting for roughly 42,000 jobs and generating $6.1 billion in annual shipments around the world.
For years, technological innovations served only to strengthen those numbers. Automated technologies allowed printers to produce more faster and for less cost. Direct digital presses changed the face of direct mail marketing, allowing for the complete personalization of each
individual mailer. But for the printing industry of today, technological advancements also have become a double-edged sword.
"The technology has helped us to compete, but has also produced so much [printing] capacity that there are too many of us," says David Radziej, president of the Printing Industry of Minnesota.
The exponential spread of electronic information also has put a damper on the industry, as more customers forgo printed materials in favor of digital alternatives. On the national scene, the U.S. Bureau of Labor Statistics reports that employment within the U.S. printing
industry is expected to decline 16 percent between 2008 and 2018, compared with an 11 percent growth projected for the economy as a whole.
Printers rely on a continual stream of equipment improvements, so the country's recent economic nosedive added to the challenge. Tighter credit markets have made it difficult for some printers to access sufficient capital to keep equipment and processes current. In this
capital intensive industry, Radziej says, an inability to update all equipment every five to 10 years can be a death sentence for printing businesses.
"This is a five-year game," Radziej says. "In five years, you need to update your equipment. If you don't, within another five years--that's a 10-year time frame--you'll be so far behind that you'll be out of business. [Advancing technology] has changed us into a
mega-fast industry."
But similar to other companies in Minnesota's manufacturing sector, printers share an optimism and drive that will not quit.
"Of course, the Internet has bumped us," Radziej says. "But you know, radio in the '50s was really nervous because TV sets were coming in, and what they did was adapt. Today, the Internet came in, and print is changing. We're just adapting. Where's this going to end up?
That's the exciting part."
Value Ad-ed
In response to the nation's excess supply of printers, the industry has fought back with diversified capabilities and expertise. As their customers work to streamline processes, Tim Johnson, president of Minneapolis-based Impact Proven Solutions, says many thriving printers
are taking a more active role in the shaping of customers' advertising strategies.
"Everyone will have to be a little more involved with their customers and their customers' marketing objectives, even though what they really do is print or mail," Johnson says. "The [printing companies] that survive are going to be the ones who position themselves in the
marketplace and in the minds of their customers as able to add value to their relationship with their customers."
In today's age of both digital and virtual publishing, printers are striving to exploit the traditional tangible, tactile qualities that make print marketing a complete sensory experience.
"Print can help [establish] a brand by creating a memory," Radziej says. "That memory can come through sight--you can see the message. It can come through touch--you can feel the roughness or the texture of a product. You think of the word 'lemon' and you almost have your
mouth watering. Did you eat a lemon? No. But it drives you to think about summertime and fun activities, so you can taste that message."
While children's books of the scratch-and sniff variety have been commonplace for years, the latest inks also appeal to adults' sense of smell. Some inks, Radziej says, will only release a smell when a person touches or approaches them.
Printers venturing into the advertising realm also are offering insights on the strategic use of color to market products in specific locations. Because colors hold different meanings in different cultures, selling a product in multiple countries may require more than one
color scheme. This year's color of choice for U.S. markets, for example, is a dull shade of lime green.
"The feel of our country is not crisp right now; it's a muted, matted color," Radziej says. "But if you're going to be moving your product from the U.S. to Europe, you'll probably be looking at more of the lavender colors this year because they have a different feel, a
different makeup of what they perceive their country doing. Color itself is just one part of the print package, but color has its own psychology to it. We have to help our clients structure their sales pitch."
Once clients deliver that sales pitch, some printing companies continue by offering a myriad of related services. Some have become a customer's warehouse, picking, packing and shipping online orders. Others are stepping in to offer brand protection and data security services,
which are becoming increasingly important as customers market their brand across an ever-expanding variety of print and electronic media.
Customers selling products internationally find brand protection and proof of authenticity especially important in preventing the production of illegal knockoff items. Printers can employ invisible inks and fibers that differentiate between authentic and copied products.
In Minneapolis, Jessen Press has gone a step further in collaborating on clients' marketing campaigns, setting up and monitoring personalized Web pages for its clients' customers. The customers receive a personalized postcard in the mail containing a URL Web address unique to
them. When they log on, their personal Web page is customized to reflect products they have purchased in the past and products that might appeal to them now. Clients can monitor data on how many people log on or make purchases--or they can have Jessen Press send regular weekly or
monthly updates throughout the course of each marketing campaign.
Mark Jessen, president of the company, says real-time information is valuable because it allows his clients to fine-tune their marketing campaigns for the best outcome.
"Oftentimes, the knock against direct mail has been that they didn't know how effective it was," Jessen says. "With a personalized URL, you know exactly which promotion worked better than others, so you can adjust on the fly. The beauty of it is that it's real-time
[information]. This really allows us to maximize the response rate because we're seeing what's happening as it's happening."
St. Paul's Sexton Printing also has expanded into virtual media, hiring experts in both marketing and one-to-one communications to form its newest division, Sexton Strategic. Sexton Strategic works with customers to develop marketing strategies and manages e-mail and text
messaging marketing campaigns. Tim Sexton, president, says the addition of virtual media messaging capabilities will help ensure long-term success for the company as more customers gravitate towards electronic media for their marketing needs.
"The challenge is to evolve and change and look for new revenue streams beyond the ink on paper part of it," Sexton says. "We still have our core printing company--we still have to be technologically advanced in that area--but we didn't think that would help us to remain
competitive in the long run due to changing communications patterns."
With so many directions in which to expand, Johnson says developing a niche of expertise is key to moving forward. "Five or six years ago, people would have thought of the mailing, printing, pick-and-pack order fulfillment and marketing industries as separate," Johnson
says. "Now they're one, and people in those businesses have to figure out what capabilities of this new converged industry they are going to offer."
Merging Talents
For some companies, the industry's overabundance of printers has been an opportunity for growth. Over the past two years, Impact Proven Solutions has acquired four Minnesota printing businesses that specialize in different products or services.
"There are economies of scale in this business, so where we see complementary companies that are struggling, we're trying to bring them in to become part of us," Johnson says. "Acquisitions are our strategic response to the convergence of the industry and the state of the
industry being out of balance in terms of supply and demand."
While the built-in customer bases of each acquired company have been the largest benefit to Impact Proven Solutions, with each acquisition also came new expertise and capabilities, which have helped the company to attract brand-new clients as well.
Acquisition of a division of Minneapolis based ZipSort Inc. helped the company broaden its capabilities to the printing and mailing of critical documents such as statements and invoices. Later acquisitions of the Minneapolis Star Tribune's direct mail division, PrimeNet and
Advantage Mailing helped Impact Proven Solutions take giant steps in its knowledge and use of analytics to help customers achieve more effective marketing strategies.
"None of the companies [acquired] were identical to us, and they're all doing a few things differently, so we have ended up with a more robust set of capabilities that we can do in house," Johnson says. "Thus far, it's been a good strategic response from us to what we're
seeing in the industry."
All in all, the acquisitions doubled the company's employees and customer base, leading to a projected 25 percent increase in annual sales compared with 2009.
The Original Green
As environmental efforts echo through American businesses and communities, a misperception that the printing industry is not green has become one of the major challenges of doing business.
"It's so cool how green this industry really is," Radziej says. "Everybody thinks, 'Oh my gosh, you're cutting trees.' We planted the trees. We planted the trees just like the farmers planted the corn. It's a crop."
As Michael Keene, president of The John Roberts Company, says, printed materials remain "the only renewable communication device available." But many printers' environmental commitments extend far beyond the renewable nature of paper, attracting even the most
earth-conscious customers.
The John Roberts Company replaced its traditional ink and chemicals with environmentally friendly alternatives. The company also invested in a machine that allows it to recycle and reuse its pressroom chemicals.
Johnson Printing and Packaging has been 100 percent wind powered since 2006. When the 55-employee company converted to wind power, it was the largest commercial business in Minnesota to do so. According to Stu Weitzman, its owner and president, the switch is equivalent to
eliminating 500 tons of carbon emissions or planting 123 acres of trees each year.
Johnson Printing and Packaging also has taken measures to minimize its overall energy needs. In addition to a lighting retrofit, the company built a re-circulating system to direct heat generated by its machines into air ducts, helping to heat the facility during winter.
Weitzman says the company's dedication to the environment has helped Johnson Printing and Packaging attract more customers. "Nobody will not do business with me because I'm environmentally friendly, and some companies want to do business with me [specifically] because am
environmentally friendly," Weitzman says. "It's something that consumers are becoming very aware of and are looking to buy products that are environmentally friendly, so I think it will continue to be a strong initiative for us."
Impact Proven Solutions uses energy-efficient lighting and works with customers to make sure the personalized mailers it prints are sent to up-to-date addresses. Considering the environment is a must for businesses wanting to remain competitive, Johnson says.
"There is no question in my mind that [green] is here to stay . . . so every company has to respond," Johnson says. "We want to be green, and we want to encourage our customers to move in that direction. Because if you don't, you're not doing the right thing, whether you
like it or not. It's just what's happening."
To showcase some of Minnesota's most environmentally responsible printers, Printing Industry of Minnesota offers The Minnesota Great Printer Environmental Initiative certification program. Participating businesses agree to meet and exceed government regulations for
environmental compliance and to work continuously to minimize waste and maximize energy efficiencies. PIM also conducts periodic audits of each certified company to guarantee environmental stewardship.
While many printers believe the business case for going green is strong, Radziej says the certification program's fundamental mission is simple. "We touch the planet," he says. "There's no doubt that we have an impact . . . and if we can be greener and more sustainable, I
want to go there."
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