It is no surprise that packaging and package prototyping are of intense interest in the printing business. Through the economic downturn many companies in the wide-format business looked at adjacent market opportunities to try to drive new sources of revenue, and package printing and package prototyping are good examples. One of the great aspects of packaging is that, unlike some wide-format applications, there is no digital substitute. In fact, the proliferation of consumer brands and versions is creating a greater need for digital printing in the packaging market as the average print run length declines. A lot of technology developed by companies like Xaar, Fujifilm-Dimatix, HP, Epson, and others that was intended for use in the wide-format market has found its way into package printing and package prototyping. The Roland LEC integrated printer-cutters is one of the best examples, this device was one of the hits of the autumn LabelExpo show which serves the packaging market. Roland DG serves as a segue into one of my predictions for 2011—that in 2011 we’ll see a UV-curable metallic inkjet ink that could be applied to either the wide format digital graphics business or the packaging and package prototyping segments. Since Roland also launched the first (that I am aware of) metallic inkjet ink. Some of our recent survey data, and my own observation in retail locations leads me to believe that there is as much or more need for metallic inkjet ink in the packaging market as there is in the wide format graphics business.
Ink technology, developed in cooperation with advanced print heads of course, has enabled enormous market opportunities in the past for such things as digital graphics, outdoor graphics, and printing directly onto rigid materials and textiles. One of the biggest adjustments InfoTrends has had to continuously make in its market forecasting and segmentation has been related to the impact of new ink technologies. Recently we added a segment we call “durable aqueous” which is most prominently represented by HP’s Latex ink technology but is now joined by the Sepiax ink in this segment. I have now seen at least three different iterations of 24-inch and 44-inch wide-format “durable aqueous” inkjet printers all sold by systems integrators based on that Sepiax ink, the first was at the FESPA-Munich event last year by a UK systems integrator, the second was at SGIA by Graphics One of California, the third was by Ordway Sign Supply also of California. In my business we sometimes say “once is an event, twice could be a coincidence, three times makes a trend”. I bought into the “durable aqueous” story when it was just HP, now that there are more alternatives I believe the segment has enormous potential. In fact, by 2014 we believe that the “aqueous durable” segment will grow at a pretty fantastic make up almost 30 percent of the $3 billion wide-format aqueous inkjet graphics market. We believe a lot of this growth will come from the replacement of other wide-format digital printing technologies, specifically more traditional wide-format aqueous inkjet printers as well as older “light-solvent” or “eco-solvent” printers.
A lot of the recent market research data we are gathering indicates that 2010 was a mixed year, and many of the PSPs, dealers, and equipment manufacturers we talk to had pretty low expectations for 2010. I think a lot of the “vibe” from SGIA and other events and conversations we’ve been involved in are very optimistic for 2011 and there is a lot of reason to be. We think there are some tremendous growth areas, such as the application of variable data in wide-format and the integration of things like QR codes to help make wide-format a more valuable and more measurably valuable part of brand campaigns. One effect of the economic downturn has been that all aspects of the wide-format value chain have taken a much harder look at costs and ROI. The inclusion of variable data and QR codes are going to be big in 2011 as advertisers look for ways to understand the value of their advertising spend. Moreover, it is very early in these markets, so the ability to include the elements at this point will be a differentiator for the PSPs that can do it. Another prediction I will make here is that color management and the adherence to color standards is going to be an area of a lot of focus this year. We hear a lot about the development of international color standards that are observed by many commercial printers, but not so much in the wide format world. Starting at SGIA we started to hear a lot of chatter about how manufacturers can assist PSPs to become color certified, and how PSPs can use that color certification as a sales tool to large buyers.