By Ralf Schlozer
There is no doubt that the COVID-19 pandemic has already taken a profound impact on the printing industry. While many concerns are about the current impact, we need to look into the future to some extent as well. With a new threat like this at hand, there is some uncertainty as to how business life will be impacted, and for how long. There is some consensus that, after the current emergency orders expire, measures will be loosened to some extent in the months to come. Still, most virus experts expect restrictions to continue for another year.
Unsurprisingly, consumer behavior and media consumption have changed a lot in the last month or so, but it’s not just online streaming services who are finding some reward in this time of emergency. A current German consumer study by market research company Appinio showed some interesting results: TV and streaming consumption is up (obviously), but 26% of respondents are reading more books, while 19% have increased newspaper and magazine consumption. Board games are also up by 20%.
Buying behavior is impacted as well; while large purchases are down, consumers are spending more on books, games, household goods, and even office supplies. But what does this mean for the print industry? Some examples of print applications could also potentially gain from the current emergency measures:
Books: Increased demand in books due to time spent home
Photos: More time to create photo books and other photo prints
Newspapers & Magazines: Trusted sources of information, plus more time to read
Office Printing: Print products to support office work from home
Direct Mail: Prime advertising method to reach consumers at home
Inserts & Ads: Can take advantage of newspaper/magazine/direct mail increases
Store Signage: Informational requirements for businesses that remain open to the public
Food Industry: Updated menus, information on delivery/carry-out options
Medical/Health Industry: Info sheets, labels, forms, and administrative print needs
With more time spent at home, the popularity of books has seen resurgence. Many kinds of fiction, non-fiction, and informational titles should do well. With the closure of restaurants and encouragement of at-home cooking, recipe books will be in particular demand. And with more time spent indoors, coloring books will also see increased demand for both children and adults. We can expect a lot of interest in self-help guides as well. Not all books will benefit, however; demand for travel guides is way down. Product manuals could struggle as they are often tied to larger investments. One related application should do quite well however: photo books. If you previously lacked the time to sift through those folders of pictures on your computer and phone, you most likely have it now.
The bottleneck for increasing book consumption is simply distribution. Although there are still strong supporters of local bookshops, it’s likely that online ordering will gain a lot (especially the goliath of a company starting with an A). The downside is that we can expect that company to use its strong market position to push e-books, which already provide a better margin than printed books. We do know that most consumers still prefer printed books, and e-book sales have been stagnating lately, but this exceptional situation could change buying patterns.
In volatile times like this, with the majority of news items directly impacting readers (and with more time to read at hand), it’s no surprise that newspapers and magazines are experiencing a resurgence. They, however, face an even larger bottleneck in distribution than that of books. While most areas will maintain distribution for subscription titles, newsstand sales will be tremendously reduced. However, the titles making it onto the shelves at the supermarket may benefit. Free magazines and newspapers, (previously picked up during one’s commute) will be in decline, although many publishers in the UK have already resorted to distributing copies to homes. Once in the hands of readers, newspapers and magazines should do well, even for embattled magazine categories. A large portion of the recent decline in magazine circulation was due to the demise of the traditional TV magazine. This application could potentially see a resurgence in some form, as new titles on streaming media are set to grow. Demand for news magazines is likely to soar, while the more diverting titles could benefit as well, as readers have more free time overall. New opportunities could arise in customer magazines, as companies still want to inform and communicate with their customers.
There should be some opportunities in office print, as well. Business cards may suffer due to a focus away from personal contact, but an increase in positions working from home could mean more stationery, calendars, printed reports, notepads, and similar products. The outlook is a bit unclear at the moment, however, as economic activities are decreasing overall.
We can expect some increase in direct mail and catalogs for companies to advertise to consumers who are confined to their homes. An increase of people spending time at home should increase the exposure for recipients, and hence increase effectiveness. Again, an operating distribution network is crucial. Mailings of a more informational nature, designed to inform consumers and companies about new regulations, changes in services, and other notifications, will remain steadily important. With increases in direct mail, printed inserts and advertisements for newspapers and magazines could benefit as well. Heightened mail traffic will offer more opportunities for attractive inserts on top. Of course, this will all depend on how much companies are cutting back their advertising budget at this time. Economic theory tells us that in times of slowing business, advertising spending should be increased; but in reality, this idea is often ignored.
While out-of-home advertising may suffer, there is heightened demand for signage and informational banners. These are especially important in the current early phase of the crisis, when businesses that remain open need to communicate that fact; but there should be an increased ongoing demand for these types of print products. With regards to the food industry, products such as carry-out and delivery menus, as well as store signage, should remain a consistent necessity.
There is no doubt that COVID-19 will permanently and negatively impact the global economy, and the printing industry is no exception. Marketing collateral, any event-related print, out-of-home advertising, and a lot of retail-related print will suffer greatly. Even packaging could be affected in the near future, as quick dashes to the supermarket will curb the need for elaborate packaging designs—on top of slowing consumption in general. Still, there are opportunities arising in print for the ones that can identify and grab the opportunity.