There sure are a lot of mixed signals about the global economy out there. While there is a lot of negativity in the general market in terms of employment and GDP growth, as it relates to the signage and graphics market a lot of the data and feedback we get from the stakeholders in the market is strong.
An example of this is that in June 2011 InfoTrends executed a wide-format print buyer study in North America to look at trends in demand for wide-format signage and graphics. This kind of input helps us understand some of the challenges that print service providers are faced with in the wide-format digital graphics market. This study was an update from a previous InfoTrends study, so there is something of a comparison available. The results of this study help us validate some of our assumptions as they relate to the technologies print service providers can be expected to invest in to meet the needs of wide-format print buyers. There are a few key findings described below.
Let’s start with some good news: Almost four times as many wide-format print buyers reported that they expect to spend more over the next 12 months than they did over the last 12 months. This is good news, and the even better news is that all types of companies are anticipating the growth. Larger companies, those with 100 or more employees, are actually reporting the biggest increase in spending expenditures. Presumably those larger companies spend more on wide-format graphics, and so it is expected that volume growth will be led by these larger companies.
Of the companies that suggested they expect to spend more, the average growth was 17 percent. That is 17 percent growth in the overall—not bad!
If you want to get in on that growth you have got to be properly positioned, meaning print buyers have to think of you as capable of providing the goods and services they need, when they need them, at the price they are willing to pay.
Quality vs. Price
The wide-format print buyer survey asked a question about why buyers select the sources they select. I think the comparison between the 2009 and 2011 studies is a set of results that a lot of print service providers are going to love.
When we did this survey back in 2009 “best price” was the top selection criteria, but in our most recent survey “best quality” was the top response. Now, this could reflect a different set of survey respondents, and that probably does play a part in the change over time. But it is good sign that the buyers are placing a greater priority on quality than on price, even though price remains one of the top considerations.
What is somewhat disappointing is that some of the other “service” type of factors such as presenting a knowledgeable staff, having a convenient store location, having expert design help, or having good, efficient customer services actually seem to be losing ground compared to 2009.
I think it is not right, of course, to suggest that these are not important, just that the other factors pretty much eliminate PSPs from consideration. If they don’t perceive you as able to produce the high volume jobs, they don’t offer you the job. If they perceive you as a high-cost provider, then there are certain jobs for which they won’t even involve you in the bidding.
Short Turnarounds and Sustanability
Another research result points to the requirement from the buyer side for fast turnaround. We’ve heard anecdotally many times that “buyers take forever to make some of these purchasing decisions” then expect the print provider to turn these jobs around quickly.
When we asked the print buyers what their most common turnaround time request was, 70 percent of them reported that when they order wide-format graphics they need to get them on a very fast basis; within two days of being ordered. That’s 70 percent of orders need to be fulfilled within two days of being ordered!