Last week saw the announcement of another merger in the print/mail industry. Two national document outsourcing companies will form a new entity, with an interesting new name.
Using LinkedIn and Twitter, plus Google alerts and subscriptions to various industry newsletters, I try to stay up to date with the latest news. Lately it seems that even this isn’t enough. Product offerings, corporate structures and company brands change more frequently than the roster of the Boston Red Sox. I look out at the field, see a lot of unfamiliar names and wonder, “Who’s on first?”
We should expect even more transformations in the immediate future. There is excess capacity in the marketplace and pressures from multiple factors. Changes in volumes, shifts in technology and shareholder influence will continue to drive the pace of change.
Declining Volumes
Physical documents, print and mail continue to be an integral component of customer relationships. Studies show that direct mail and catalogues help increase traffic to websites. Even companies that have seen spikes in online payments, know that the preference for most customers is to receive hard-copy bills. For now.
While the pace of the decline in the volumes of physical mail has slowed in recent years, it’s still declining. Companies are combining messages into a single envelope whenever possible. List management improvements allow for smaller, more targeted – and more effective direct mailings. More conversion to electronic communication is inevitable.
Technology Disruptions
The impact of high-speed production inkjet printing is transforming the print-mail industry. The introduction of enhanced document composition software and treated paper substrates have significantly improved quality. Finishing equipment continues to process paper faster, and with greater integrity.
Companies exploiting new technology are able to merge jobs, eliminate unnecessary turnovers and increase efficiencies. More work is being accomplished with less equipment, fewer employees and at a lower cost. Competition is getting tougher.
Shareholder Expectations
One of the corporate owners in the merger mentioned earlier is a venture capital firm. The recent Xerox break-up occurred after investor Carl Icahn’s corporation got a member on the board of directors. Several of the major players in the industry are owned by investment firms.
In the current economic climate, most investors want quicker share growth – even if it includes acquisitions or divestment. In a mature marketplace, like the print/mail industry, the result is more forced disruptions. The new status quo is more change.
What's Next?
February marks the start of Spring Training. Veterans and rookies go up to the plate in hopes of either extending their careers or introducing a new name to the league. It’s time for all of us to get our scorecards and pay attention to what’s happening on the field.
