Caption: The Tower of David, Jerusalem
Once dismissed by the establishment as the chutzpah of a brash showman, Indigo founder Benny Landa’s prophecy ‘everything that can become digital will become digital – and printing is no exception’, shows every indication of coming to pass.
Since selecting Ipex ’93 as the platform on which to challenge the supremacy of the conventional analogue process, HP Indigo has now toppled Heidelberg as the UK flagship print event’s largest stand-holder. Another clear indication of just how much digital means business is that while HP is demonstrating at least five presses at the NEC next month, manroland, that other bastion of the old guard, is opting merely to show video clips of its equipment in operation.
HP Indigo estimates that one-fifth of its 3 600 customers (5 300 presses) are operating within the $267-billion packaging print market – predominantly labelling – of which digital is on track to command a 15% share of a global $28-billion annual output and predicted to build exponentially to 27% by 2013 (source: Pira International).
Today labelling, tomorrow, flexible packaging and folding cartons?
Valued at $50-billion and $36-billion respectively – of which digital’s current share is only 0,1% and 0,6% respectively – they’re both well within HP’s narrow web-width and substrate thickness parameters.
Currently, the ws6000 is the best equipped in terms of technology and capability to lead the charge into these new territories. Existing users are already making some headway; for example, original US beta site adopter Innovative Labelling Solutions. ‘With the new HP Indigo ws6000, we’ve certainly seen a growth in the marketplace that we’re able to address digitally,’ says CEO Jay Dollries. ‘We have the opportunity to supply anything that a customer might need. You name it – from shrink sleeves and flexible packaging to folding cartons, labels and tags, we can do it.
‘I often get asked what substrates we print on,’ he continues. ‘It’s easier for me to tell you what substrates we don’t print on – so far, we haven’t found any. With the ws6000’s white-ink printing capabilities we can reduce the cost of flexible packaging jobs, Also, we can take advantage of what the rest of the market isn’t doing now – turning flexible packaging jobs around within a week.’
The technology for our times
Despite the impact that’s been achieved, the past 17 years of evangelising have also taught HP Indigo that it can’t necessarily rely on its customer base to spread the gospel.
While they’d never admit it in public, the bulk of converters have impeded rather than accelerated the rate of adoption of digital print. Nor, in the main, have they drawn its full potential as a marketing tool to the attention of their brand owner customers.
Maybe the root cause for this disconnect lies back at the beginning, with Indigo under Landa’s leadership mainly intent on proving that its ElectroInk solution was every bit as good as offset. While, arguably, it is now, it certainly wasn’t then.
Perceived discrepancies in engineering and technical capability became the key criteria for assessment, monopolising the debate, and affording the in-situ processes and the users invested in them scoring points that were understandably seized on with alacrity.
Early adopters in the commercial print sector were largely High Street copy-shops looking to upgrade their service, while in packaging terms it was initially seen as a means of producing a smarter variant of WYSIWYG prototyping. It’s taken the passage of time, not to mention significant levels of investment and effort, for digital to gather sufficient momentum to present itself as a serious contender for mainstream adoption.
With print now not so much an industry, more a component part of a wider multi-channel communications network, that opportunity is now within the technology’s and in particular HP Indigo’s grasp. There are, however, fresh challenges to address. Despite its prominent profile, it’s far from being the only source of supply, with escalating competition coming from inkjet, which not only has the added advantage of greater speed, but can also be integrated within digital/conventional hybrid systems. Furthermore, HP’s digital ink technology is unique – not necessarily the most reliable asset in a developing market.
What will play in its favour, however, is the resonance of the HP name. There are clear indications that, with or without feed-back from their print service providers, brand owner marketing departments are steadily bridging the knowledge gap that has hitherto existed. While volumes of printed pages will reduce in the commercial sector, packaging print – and more specifically, its potential for fulfilling fast turnaround marketing messaging – is certain to become the prime option for flagging up product differentiation.
‘The HP Indigo ws6000 is real ‘game changing’ technology. With frequent artwork changes and high ‘Stock Keeping Unit’ (SKU) complexity, this digital technology can dramatically reduce the speed to market for labels and other printed packaging materials,’ says Procter & Gamble’s associate director of corporate R&D, Michael Ferrari.
‘As more label and packaging work goes digital, companies like P&G can enhance the consumer experience by efficiently bringing a greater variety of designs to store shelves, ensuring that more consumers are aware of a given product’s benefits and qualities.’
Brands won’t necessarily buy the systems – not yet at least – but they will increasingly be the major influence upon purchase. What makes the engine tick is, however, going to be of less interest than where and how cost-effectively and swiftly it can take them from A to B. Having mastered its technology, HP Indigo now has to do likewise with the vocabulary to sell it in. Shouldn’t be a problem. As they say all the way from Palo Alto to Kiryat Gat:go invent.
Converters have impeded rather than accelerated the rate of adoption of digital print. They have failed to draw its full potential as a marketing tool to the attention of their brand owner customers.
Digital technology can dramatically reduce speed to market for labels and other printed packaging materials.
The world according to Alon Bar-Shany
PACKAGiNG & PRINT MEDIA – represented by Susi Moore – was one of a select group of international trade publications invited to join HP Indigo’s four-day Labels & Packaging event in Israel in early March, for existing and prospective customers drawn from 27 countries.
Towards the end of the programme, delegates were given an opportunity to find out more about the HP Indigo’s world view in open forum with VP and general manager Alon Bar-Shany.
The questions ranged from the practical (‘how will you compete with inkjet’) to the personal (‘how would you best like to be remembered’), and the answers were refreshingly candid. Here’s just a sample of the digital sector’s acknowledged leader’s current thinking.
Will Indigo presses run faster and be made available in a larger format?
‘I’ve been 15 years with Indigo, and this question always comes up. We’ve not yet reached any technological limitation on width or on speed, but it’s a question of customer needs. Are they willing to pay for it; can they make money from it and still maintain quality?
‘At drupa ’08 we showed the world a brand-new portfolio, and 18 months later we’ve delivered every single product. People are using the ws6000, people are using the HPI 7000 – but clearly we don’t believe this is the end of the technology. To go still wider would mean a major change in the system in terms of engineering as our technology doesn’t use inkjet. It’s do-able if it’s a proposition for customers.’
Where are you positioned in relation to the competition?
‘In the category where PSPs are capable of printing above one million A4 pages a month, then HP Indigo has a 50% share – so we’re number one. Xerox is number two; Kodak is a distant, distant third. Probably, at number four is Jetrion as they sold more presses than Xeikon last year.
‘We’re quite pleased with where we are today, but we’re not looking for quantity of presses; we’re looking at how many pages or how many labels our customers print on them. That’s how we make more money – when the customer is paying for ink, etc – and that’s where they make more money. Having people printing very little, but on a lot more presses, would only work for us for a very short time.’
Has HP Indigo opened up a market only to have other suppliers capitalise on that at HP Indigo’s expense?
‘It’s always a risk, and it’s happened to many good companies. To insure against it, you have to stay continuously ahead of the curve, to innovate and go on getting better. I don’t think just the fact that we’re number one guarantees anything. You should never assume that nobody is going to surprise you.
‘However, I would say that HP Indigo has a fundamental technological differentiation and advantage for certain markets. That doesn’t mean that inkjet won’t have great applications, but in my personal opinion I don’t think it’ll be able to compete with Indigo on the packaging side, on the photo side or in marketing collateral.’
How do you see print sitting in a media-neutral world where it’s competing with other forms of communication to get attention?
‘Quantities are going to go down. We may be talking 10 to 15 years, but there’s going to be a lot less print and certainly in developed countries. In general, I think print is going to become a lot more focused: shorter runs; more colours; more customisation; more as a derivative of internet marketing than the lead medium.
‘Digital will facilitate new applications and more creativity. Printing will become more an aggregate of great niches, because printing can provide this mass customisation which not only makes a lot of sense, but adds more value.’
How do you think that trade publications will manage in that environment?
‘They’ll have to become more sophisticated in the content first of all; more focused, and more specialised. I still see a value of a magazine format over reading things via the internet – you can flip back and forth, you can write things, you can take it, you can fold it, you can insert things into it – but I would love to have an issue customised and printed just for me.’
And as it’s topical, what’s your view on the future of trade exhibitions?
‘First of all, I would differentiate between drupa – for which there’s going to be room for a long time – and everything else. Local shows will have to move from a yearly frequency to once every two or maybe four years.
‘The biggest show last year was Print China, and then one in Moscow. There’s a big show this year in Brazil, and one in Korea. The world is changing. Whether Ipex will still have strategic value I don’t know. It has a lot of emotional value for Indigo, and it’s still an important show for the UK, for India, Australia, South Africa and some Asian countries.
‘I think the internet is absolutely not a replacement. On the internet they can show you anything and it’ll look beautiful – so if you want to see the equipment and the quality, I don’t think shows will go away.’