Innovation is a key requirement for marketing in any field. Business marketers in particular are constantly under pressure from their employers to find new, better, faster and more effective ways of speaking to customers and prospects, and ultimately driving revenue. As a result, they are typically quick to seize new ideas or concepts that provide opportunities for more effective campaigns.
But whilst some new developments or opportunities are grabbed with both hands by marketers (eg. search marketing, email marketing, SMS by consumer marketers), others take longer to permeate through. Possibly the best example of such overlooked innovations is variable digital print (VDP).
VDP is a collaboration between intuitive use of data and flexible printing techniques which enables high levels of customisation of direct marketing materials, which in turn promises significant increases in response to mailers. It has effectively been possible in the UK since the first digital presses were installed in the late 1990s, but in reality uptake has been extremely slow, with both printers themselves and client-side marketers appearing reluctant to investigate its potential.
However, the momentum behind VDP has gathered (albeit slowly) with more and more printers promoting it to their customers, whilst some enlightened clients and agencies have woken up to the opportunities it presents. This year’s International Direct Marketing Fair (IDMF) will bolster this education process, featuring a dedicated seminar programme organised by the British Printing Industry Federation (BPIF) that focuses entirely on the benefits of VDP. The Digital Print Pavilion is free to all IDMF visitors, and is specifically designed to increase marketers’ understanding of VDP.
Yet despite the best intentions of the BPIF, there is still a long way to go before VDP becomes mainstream: as B2B Marketing’s survey (see page 21) demonstrates, there remains an enormous amount of ignorance regarding VDP, and worse still very little practical experience of it particularly in the B2B sector. Thus the key questions remain: why have marketers been so blinkered to this innovation and its potential benefits? And what will it take for adoption to become widespread?
According to Mike Hughes, CEO of Mail Marketing International, a direct mail service provider that offers VDP services, there are three principal barriers to adoption of VDP. These are skills, costs and speed, he explains, and all of these relate to the technology available to deliver VDP.
Skills concerns printers’ understanding of VDP, and their ability to offer it as a service. To date, this has been an all too rare commodity amongst UK printers, although the sophistication of management software systems is increasing, as is understanding of how to use them.
Hughes continues, cost wise, VDP is a premium-rated product, in comparison with traditional printing. But these prices will drop in time. According to one printer, the cost of a VDP campaign is currently up to five times more than a standard, non-variable campaign, which is obviously prohibitive to some, but must be balanced against the fact that responses can be up to 20 per cent higher.
Speed will also improve in the next three to five years, continues Hughes. Things will only get better as the technology improves. And it inevitably will.
Lenny Bryan MD of HDI, says question marks over the quality of digital printing generally have also undermined confidence in using variable techniques. We offer both litho and digital print. Clients are still worried about the quality of digital, but once you show them examples, they relax. It is building its own market as the quality improves. The same thing is happening variable digital.
But whilst most of these issues face the printers at the production end, Andy Wood, managing director of Total DM, says the overriding factor in determining the practicability of VDP is that perpetual bane of the B2B direct marketer: data.
Slow uptake of VDP is not the result of problems with technology: it is a data issue and too many companies don’t understand this. VDP has to be data driven.
This is echoed by Aaron Archer, MD of Butler & Tanner. Good data is a major barrier companies have to free it up and cannot let the IT department lock it away.
Wood of Total DM says he is constantly surprised by companies’ lack of an in-depth understanding of customer-base, and the correspondingly poor quality of their data. Companies need to know quickly and easily simple facts like who is increasing sales, and who is decreasing them, and then communicate with them differently, explains Wood. Without such insights, VDP is simply not possible. Data management and VDP go hand-in-hand. Good data forces up creativity, rather than limits it.
The prerequisite for good data goes a long way to explaining why uptake of VDP has been slower in the B2B sector than in B2C, according to some observers. It is well-documented that the combination of regular changes in contact details for both individual decision makers and entire companies makes maintaining accurate business data far more problematic than consumer data. Bad practice in terms of data capture and maintenance only exacerbates the situation.
The one thing which all VDP suppliers have in common is optimism for the future, and although Andy Wood believes poor data is a major obstacle for many companies now, he is confident that this problem will ease in time. I think this will change in the next two-three years, he says. There is a lot of knowledge about VDP out there, and this is increasingly being used by clients.
Wood says that the important factor in this process will be for more clients to make a proper commitment to CRM, which a large number only pay lip-service to. The key thing about CRM is that a lot of the associated costs are not monetary, they are in management time. They change your marketing from running a single campaign, to as many as 300 different campaigns [targeting different customer segments]. This is a huge shift.
The irony in the poor quality of many firms’ data, claims Wood, is large quantities of client customer information is already retained, but inaccessible to the marketing department. B2B is actually a data-rich environment because they are regularly invoicing their clients. Many companies don’t know or understand this. They can get at this data fairly easily, although IT departments often claim that they cannot.
As with adoption of any innovation, there are pull factors as well as push factors, and arguably the most important driver of VDP has been and will continue to be promotion of these facilities by printers themselves. In recent months, a core of enlightened printers has emerged who are familiar, comfortable and adept at providing such services to customers.
Significantly these companies have done more than just acknowledge the existence of a new market. They have also changed their operating practices to offer these services, and acknowledged that the importance of data in VDP requires not only greater co-operation between clients and suppliers, but new infrastructure and associated skills. It is about more than just buying a new piece of software.
Archer of Butler & Tanner, comments, printers are starting to move upstream to provide these services. They are becoming business partners, and more important to clients. He says this collaborative approach should encompass all companies involved in marketing activity, including agencies and mailing houses.
It is no surprise, therefore, that some of the most vocal proponents of VDP are not ‘traditional’ printers. They are emerging from sectors such as the mailing house community. Both Total DM and Mail Marketing International fit into this last category. Mike Hughes of the latter, comments, traditional commercial printers will need to learn and understand upstream processes such as data and creative to enter this market. They have to change their mindset to become a service provider. This will change the whole structure of the industry.
This is certainly the case for data giant DNB, for whom senior marketing manager Adrian Cutcliffe claims collaborative working is a key strategic objective. It is not just about data, it is about consultancy. DNB are aligning ourselves with VDP suppliers, and software developers. Cutcliffe joined DNB from a background in printing, but says one of the first things he noticed was the already high and growing level of collaboration between printers and direct marketers. As well as continuing to educate clients on data issues, he says DNB will increasingly seek to educate unenlightened printers on the benefits of VDP, and the need for collaborative working to achieve this.
As representative trade body for the printing industry, the BPIF has also been focused heavily on educating printers on new opportunities, and consequently VDP. Cicely Brown, director of corporate & external affairs for the BPIF, comments, the lines are increasingly blurring between different suppliers, and we are encouraging this to enable our members to add value.
To achieve this, BPIF has nurtured close links with the Direct Marketing Association, enabling the members of each association to attend the others’ events free of charge. We are trying to facilitate interaction. We want to make it easier for people to speak to one another. This is what any proactive trade association should do. This, plus the Digital Print Pavilion, makes BPIF the most enthusiastic supporter of VDP.
Printers need to become more data-savvy, agrees Paul Cash, MD of agency Tidalwave, and this will inevitably lead to some consolidation. We’ve seen data experts who have become printers and printers who have tried to improve their data arm. The winner in the long run will have to be expert in both.
Cash also makes the point that a growing number of companies from all sides of the industry are making grand claims regarding VDP expertise, which have little basis in reality. Many printers and service providers which claim to be on board do not fully appreciate how and why this is a vital new technology, nor do not they understand how to deliver a seamless pain-free implementation experience. And this is also true of agencies.
As ever, there are some less scrupulous companies attempting to jump onboard the bandwagon, and clients are advised to be cautious.
So it seems as if VDP may be an idea whose time has come… or at least about to come. The components for widespread adoption have fallen or are falling into place. However, whilst awareness in business-to-business is growing, it seems likely that uptake will be much slower, as organisations continue to wrestle with the inadequacies of their proprietary data. Consumer marketers, with their more sophisticated data resources, are likely to migrate towards it more quickly.
Despite this, most observers are convinced that VDP has the potential to have dramatic repercussions and benefits for business marketing.
Mike Hughes of Mail Marketing International, enthuses, Once marketers understand that this isn’t about technology, it is about data, there will be a rapid move towards it. The customers we have supplied it to are very satisfied none are going back to traditional techniques. We are very excited.
Adrian Sutcliffe of DNB is a little more sceptical. Some printers are claiming that the revolution is here already. VDP is certainly going to give some people better results. Others will want to wait and see what happens.
But Cicely Brown of BPIF is convinced that VDP is the future. Nothing will happen overnight, but I believe there is a spark here to be lit, and when this happens it will spread very quickly.
The principal benefit offered by Digital Variable Print (VDP) is to enable personalisation of material, which in turn results in a great response from recipients. This facility has been available from the earliest days of digital printing, but recent enhancements in printing software has significantly enhanced the possibilities for such mailings, including varying large amounts of creative between different segments, instead of simply changing the name and mailing address. The speed of such variable print jobs has also increased. But as Aaron Archer of Butler & Tanner explains, personalisation is not the only benefit of VDP. It enables brands to reduce the obsolescence of their marketing material, he says, pointing out that variable techniques enable companies to produce smaller, more tailored runs of printed matter. Archer adds, it also cures brand control issues, for companies marketing via channels. Companies can lock down branding within marketing material, whilst opening selected elements for customisation by dealers.
