Variable data printing update

Mar 01, 2010 10:30 PM  By

True print personalization — namely, customized catalogs and other tailored direct mail communications — was supposed to be the next big thing five years ago. As the experts said back then, costs will continue to come down, quality will improve and the process will be faster and easier.

All that’s happened. So why aren’t more people using variable data printing today?

Most marketers still believe it’s too expensive. The price may have come down significantly, but a personalized print job is going to cost more than a traditional per-piece rate for a regular catalog — about three times more, by some estimates. And with the economy what it’s been, nobody is interested in increasing their expenditures.

There’s no question that VDP is still cost prohibitive for most multichannel merchants, says Scott Busch, business development manager for Lexinet Corp., which specializes in variable data printing. “Probably for many, the systems still are more expensive on the front end, so you need to gauge the projected upside increase in sales vs. the added costs,” he says.

Then again, the return tends to be higher, especially the more personalized your mail piece is. Assuming all other factors are equal — offer, timing, audience, form factor — returns for a fully variable job range from two times to 15 times the rate of return for a static job, says Nicky Milner, vice president of program management for printer Transcontinental.

How do you increase your chances of a higher return? “Relevancy of content and the quality of the data are the determining factors,” Milner says. Simple personalization and addressing will likely yield an ROI on the lower end. The best results come from “actually customizing content to specific intelligence we may have about an individual consumer,” she says.

The technology is all generally improving to the point where it is really starting to delivery on its promises, “and the cost has come down due to efficiency and speed,” Milner says. “So finally, we are reaching that tipping point where the math is really starting to make sense for more applications.”

GETTING MAILERS ON BOARD

The biggest hurdles to getting mailers to adopt variable printing are education and status quo, Milner says. Customers who have not yet experienced VDP often have reservations and find it easier to continue doing things the way they’ve always done them.

And money remains an object, though mailers worried about the price tag of variable data printing need to consider the “total cost,” Milner says. In other words, “if waste and obsolescence of information over the life cycle of the document are also taken into account, as opposed to just the upfront production costs, the cost differential of static vs. customized on-demand becomes negligible, and in some cases that we have seen, reverses direction.”

The conversation about a VDP campaign “is one that needs to be had with a marketing executive, vs. someone in a purchasing or procurement role,” she notes.

“Critical to the discussion is that we talk about marketing objectives and strategies, not just production requirements and costs.” If there is a lack of understanding or awareness at any point along the supply chain as to the objectives with the print product, Milner says, “the conversation tends to bog down into cost comparisons.”

Marketers also need to be in on the campaign execution, says Lexinet’s Busch: You do not want your IT people determining variables.

IT staff should point to options and let the marketing team or copywriters massage the variations. “Too often I see IT driven variables ‘shouted,’ and those could actually backfire and diminish response,” he says. Copywriters will tend to “whisper” variables, “so to the reader it’s completely seamless.”

THE CONTENT CONUNDRUM

Technology is only one part of VDP, Milner says. Merchants have to be ready with the content (all of the graphics, copy and the creative layout templates) and data (the analysis and rules that build into the specific targeting of the information to a specific audience). And you have to have the content tagged and managed in a database that can accommodate automated page building to rapidly and efficiently generate your custom pages.

And when it comes to the data, custom catalog generation can be targeted as finely as you have information, she notes. You should perform a full analysis of your customer transaction history for the past few years to see what nuggets of insight can be gained.

Digging into the data and performing queries on identification of certain buying triggers, patterns and purchase life cycles can pay significant dividends in building your plan. “This will help you to understand what messages, channels or timing of communications will be most influential in generating maximum returns,” says Milner.

Technology can help here — there are content management systems that presuppose multipurpose and multichannel uses for graphics and editorial copy. For instance, Milner says the XMPie, PageFlex systems are improving with each release version. “And Kodak’s Campaign Manager has finally come to market, and actually offers some pretty cool things that work well for printing applications.”

Using these types of CMSs allows the printer “to automatically generate the customized content in a print-on-demand stream,” Milner says. “This significantly reduces the cost of content acquisition,” especially if you have planned for this well in advance, she adds.

VDP GROWTH OUTLOOK

There is some evidence that interest in VDP is starting to pick up, Busch says. An informal survey of last year’s Print On Demand Institute conference attendees showed that 65% of attendees had experienced double-digit revenue growth with digital print in 2007.

Japs-Olson prints 700 million pieces per year, and about 85% of those pieces contain some degree of personalization beyond someone’s name and address, says CEO Michael W. Beddor. A number of the printer’s clients “have a tendency to do more variable data printing and more targeted direct marketing using that variable data,” he says.

At its lowest level, Milner says, variable data printing is a more efficient way to produce the right information on demand, and just in time, without waste.

At its brightest opportunity, “it becomes a fundamental component of building connections with your prospects and your customers in ways that provide meaningful value for all concerned,” she says.

CULTIVATING PURLS AND QR CODES

Some of the new uses of variable data printing include PURL mailings, says Scott Busch, business development manager for printing firm Lexinet Corp. A printed piece includes a personal URL tailored to the recipient; the recipient can respond by going directly to that PURL to answer questions, see a flash promo, purchase and so on.

What’s more, VDP can be used to include QR codes on catalogs and mail pieces. These work like conventional barcodes in that they store information — namely, mobile Website URLs — that can be read by devices with cameras, like cell phones. A user with a Web-enabled camera phone equipped with the QR reader software can scan the image of the QR code; decoding software reads the information and prompts the phone’s browser to go to a programmed URL.

QR codes have been slow to take off in the U.S., but that may change as more new phones are outfitted with the latest scanner applications. “So you can print a QR code for someone to scan and, when they do, it takes them directly to a site they can see on their phone,” Busch says. “It’s a very cool, ‘techie’ touch to the younger set.”
— JT