On Wednesday February 15, 2012, the Digital Imaging Association held a fact-filled session about trends, pricing implications, and the evolution of a key commodity for printers – PAPER. Attendees came away with substantive information to share with their clients about the strong position paper and printing continue to hold in our multi-media communications world.
Distribution Channel’s Perspective
Magda Cober and Craig Gallagher from Spicers Canada provided the DIA audience with Paper Facts and case studies that demonstrated how print has grown up and changed. Cober began by showing Domtar Paper’s “Because” campaign video highlighting the key role paper plays in our lives and why it is an environmentally sound choice.
For every tree harvested in the US, three trees are planted. Worldwide roughly 600 million trees are planted by the paper and forestry industries annually. We are contributing to the continuation – and inarguably growth – of forested land.
• Recovery rate for paper in the US is more than 63%. 38% of fibre used in the US for paper production comes from recovered sources.
• Paper made from 30% Post Consumer Waste requires 10% less energy to make, produces 25% less waste water and 6% less greenhouse gas emissions. Each ton conserves about 15 trees. (Environmental Defense Paper Calculator).
• The paper industry is the leader in the use of alternate energy sources. • No harmful, hazardous by-products result from paper placed in landfill.
And, Cober told DIA listeners, print delivers. As an example, direct mail response rates give advertisers a 13:1 return. Interprovincial Paper’s statistics show the response rate for email marketing has fallen by 57% since 2004, but response from direct mail has risen 14%.
Print has grown up. It has been significantly impacted by changing culture, changing mindsets… and the internet. Printers are angry because of the inference that print is bad. As an industry, Cober told the DIA audience, we need to change this mindset. We are not killing trees, we are not degrading the environment, we are not destroying forests. But…we are made to feel guilty about the possibility of doing just that. Craig Gallagher encouraged DIA listeners to rely on their suppliers to lead them to various industry resources that deliver facts and figures to discuss paper consumption and renewal with their customers.
Cober cited some facts of energy consumption which we forget to look at when considering online communications. For instance, burning a CD produces 4 times as much carbon dioxide as the printing of a single annual report. 81% of emails are spam. Think about all the energy needed to produce, run and house data. It is important to see the environmental impact generated from both sides – print and online.
The online world has become so dominant in our lives. We have panicked over the past few years because as printers we feel the internet has negatively impacted our world. The ironic part about it, said Cober, is that we are one industry that has not had major change to its core business – ink on paper – for a long time. We have had changes in technology, but those are the tools, not the business. Paradoxically, we are in a technological industry yet we are afraid of what the latest technology has done to us rather than for us.
Paper can co-exist with the new technologies. Print, said Craig Gallagher, leads to online buying. Print is the tactile piece that represents something of interest which leads to a buying decision. And it travels the other direction as well. The various paper mills through your paper reps offer substantive information to share with your clients to help them decide where and how to use the integrated technologies.
Magda Cober shared two case studies with the DIA audience showing how two companies are making money with print emanating from the internet. Moo.com is a web-to-print site with a difference, offering, among other options, printed Facebook business cards. The other example she shared was Stuff White People Like, a blog that rapidly escalated to 70 million followers. The blogger who started it now has two printed and published books. This blog also offers the option to order printed posters, t-shirts, and the like. All of this is based on the fact that bloggers like to see their words printed. So, online to offline is now as much of a print opportunity as offline to online.
Craig Gallagher told the DIA audience that he is often asked if all sheets will run on digital presses – and they will not. But there are certain falsehoods. Equipment technicians will state that presses are not guaranteed to run anything but stock certified for their equipment. Costs for certification can be very high because of the R&D work required. Merchants will tell customers there are certain papers they feel will run and they are happy to let printers try them. Even certified papers may not perform the same on the same equipment in two different shops.
Gallagher shared some facts that make up a true digital sheet: 1. Made-to-size or precision cutting is a 4-blade process that cuts square and exact, bringing all the lint outside – and this is key. 2. Moisture content is another critical factor. A sheet going on an offset press will be hit by water, so paper is made with that in mind. On a digital press you’re putting a sheet through heat and an electro-static process, making the right amount of moisture the essence of sheet performance. 3. Surface coating is essential because it helps adhere the toner (liquid or dry) to the paper. 4. Moisture-protected packaging.
Mills are focusing their resources toward digital grades including textured sheets. As an example, Neenah now has textured stocks, linens, vellums, and laid stocks guaranteed to run on digital presses because of a special coating that fills in the toothy surface. There is even magnetic stock that will run through digital machines. Gallagher encouraged DIA listeners to rely on their paper reps to assist them with sheets that will run on their specific presses. Jams can be costly so do your due diligence, especially with synthetics and polys. Another example he noted was Wassaua’s pressure sensitive and static cling products that will not melt to the drum. The more robust the machine, the more it can run.
Gallagher went on to discuss hard cost vs. soft cost. Hard cost is the price of the paper. Soft cost is slow production time or down time. Paper lint can be a major negative contributor. Often, cheaper paper has lint. Besides giving you bad reproduction, lint can get into your machine and burn the belts. This can quickly become a hard cost – considerably greater than the difference in cost for a true digital sheet that is manufactured to controlled standards. Because run lengths are shorter, upselling customers to a better sheet is not a significant cost factor for them – but it can make all the difference to a printer. Recommending the correct paper, Gallagher concluded, is key.
Paper Mill Perspective
Marie Aggelonitis, Regional Sales Manager for Mohawk Fine Papers was the final presenter. She shared some of the data mills analyze and some of the statistical work done toward the evolution of paper as it relates to the development of printing methods.
Aggelonitis reviewed the progression of print starting with Gutenberg and fast forwarding to Chester Carlson who developed xerography – Greek for dry printing. The convergence of technologies has lead us to where we are today – to the next generation with the growing toner market and ink jet ready to take off. She told DIA listeners that the next digital wave will launch at drupa, including some very significant announcements paper mills will be making.
So, what does this mean to our growth in the context of a 10-year span – from 2008 to 2018? In 2008, offset made up about 50% of print revenue. Digital print was at about 9%. The rest of the revenue came from other print and finishing processes. Today, offset is 48% of revenue and digital is 16%. Aggelonitis told the DIA audience, offset and digital revenues are projected to converge in 2018. Statistics show that digital is the wave of the future.
Digital printing, Aggelonitis told DIA listeners, is defined as any print technology which regenerates the content of each page. Digital today is largely dependent on electrophotography. Digital creates an image with dry toner, liquid toner, or inkjet. Digital is simply the next step in the evolution of print technology.
Digital printing with particle-based toner requires a substrate to be an integral part of the process, calling for the holding of transference of an electrical charge. Paper requires a great deal of R&D. Labs, said Aggelonitis, form the central hub of a paper mill. Paper quality and print results have a one-to-one relationship. We want reliable papers.
Aggelonitis encouraged DIA attendees to look at the paper360.org report which talks about trends in digital printing. A lot of the mills use reports and case studies as research tools to evaluate the next steps to deliver what people are asking for. She shared some of those statistics with the DIA audience. Among the things asked of digital printers was about characteristics they look for in a sheet. The results of this specific survey bear out what Craig Gallagher shared earlier – toner or ink adhesion, accurate sizing, stability, moisture level. Digital printers were further asked about the critical factors driving their paper purchasing decisions. Number one was runability. Availability was another consideration. Price was last. The report also shows that healthy printers had invested in digital, that digital means growth, that offset and digital co-exist though with a migration toward digital because it enables a broader range of applications. Short runs drive digital print and from a paper perspective this supports the fact that beautiful paper was designed for smaller jobs because the cost of the paper represents a small part of the project. Also, there is a strong interest in digital substrates other than paper because of the unique opportunities they open up for printers to offer to their customers.
Aggelonitis told DIA listeners that the paper mills are working closely with OEMs to make substrates that support the technology. For instance, Mohawk is already engaged in what the equipment companies are going to introduce at drupa so they can introduce complimentary paper/substrate products. Mills are heavily vested in printer support to know what issues are important to them. Just as offset and digital co-exist, shops now house a variety of digital technologies which require substrates that perform for both dry and liquid toner.
R&D is a huge portion of paper mills’ businesses – especially for future development. Printers are asking for comprehensive digital portfolios – sheets either smooth, or textured; uncoated, or coated; sheets that are light or sheets that are heavy; sheets having light or dark colours; and even products that are not paper sheets at all. In 1996 Mohawk started branding their papers for the way printers print. At the time it was not about digital, it was not about offset, it was about getting paper through your equipment. A whole series of different relationships evolved. For instance, when Mohawk became a preferred supplier to HP, they were required to send their paper to HP to be surface treated and then shipped back for cutting – adding about 30% to the cost of paper. The mill’s R&D team developed their internal coating formulation called I-Tone, enabling them to coat their own paper, sheet it and market it at pennies above what an offset sheet would cost – migrating from a 30% upcharge to what now sits at 2-3%.
The environmental story has now become a given – the fact that a product has pre or post consumer content, that it is FSC certified – so a lot of the mills are no longer upcharging for this.
Mohawk Fine Paper recently launched a web site called mohawkmakeready.com with videos, articles, scripted presentations and templates that put their knowledge, experience and relationships to work for digital printers. The DIA joins Maria Aggelonitis in suggesting that printers take advantage of the practical tools this dynamic resource offers. Rely on your merchants and the mills to take you from ordinary to extraordinary – Paper Makes You Look Good.