The Digital Crystal Ball

Two decades have passed since digital printing first broke onto the package printing scene, and if the several product releases that headlined drupa are any indication, it’s here to stay.

While most projections for the future of digital printing in the packaging space forecast growth, digitally printed output only makes up a small percentage of packaging. In fact, Kevin Karstedt, CEO of industry consulting firm Karstedt Partners, says just 5% of labels are printed digitally and less than 1% of all other packaging is printed digitally.

Despite digital’s slow integration and gradual rise over the past two decades, Karstedt says there’s still plenty of reason for optimism around where this technology can go and how it can be a moneymaker for converters.

“We’re to the point now where people can make decisions around digital printing, primarily in the labels market, where they can make money with this now,” Karstedt says. “They’re doing it in two different ways. The old way they’ve done it is by developing some new markets. It’s the sexy stuff like the Coca-Cola bottles or cans that are all different. But what’s now getting to that tipping point is these presses are providing operational relief. They’re able to take these troublesome jobs off of a conventional press and put them on a digital press where they can be run effectively.”

A Gradual Launch

Despite the technology being released during the same time period, digital printing has been significantly slower to take hold in packaging than it has in the commercial or document printing industries.

Both industries initially saw the value in being able to create variable output and personalize print on the fly, without having to go through lengthy plate changes. However, Marco Boer, VP of IT Strategies, explains that in document printing, this was a much easier initiative to implement.

“Unlike document printing, we don’t know who the final buyer of the package is,” he says.

Another major reason, Boer explains, is that unlike commercial printing where nearly all printing is done on paper or paperboard, the packaging market is subject to a larger array of challenging substrates.

“A lot of these products tend to be clear film,” he says. “You need white ink, and white ink is really hard to print with digital.”

Karstedt explains that the packaging industry is differentiated in the way that it is heavily divided into many subsegments. He explains that this makes packaging unique because even with conventional printing, no one type of press can handle all applications.

“The markets for packaging are so diverse,” he says. “You slice and dice it into the main four categories of labels, flexible packaging, corrugated and folding cartons and those main categories are sliced and diced even further into subcategories. It’s a very intricate mix of different types of packaging with different requirements that no single press — even an offset press or a flexo press — can go and service all of those categories.”

Acceptance and Opportunity

Though digital printing has yet to become a pervasive technology in the industry, experts are saying that it’s growing and is poised to grow at a sharp trajectory.

Particularly in the label market, where digital has established its largest footprint, new press sales are on the rise. Jennifer Dochstader, a founding partner of package printing research firm LPC, Inc., explains that 2014 was the first year that sales of new digital label presses outpaced sales of new conventional presses in the United States and Canada.

Based on these projections, Dochstader estimates that by 2020, three out of four new label presses sold in the United States and Canada will be digital. However, she explains that this projection does not mean that analog printing will be going away. Instead, in the label market, the purchase of a new digital asset will help to generate available press time on a conventional press and allow it to produce more output.

“There will still be flexo presses sold into the market, but with digital, because of the migration of applications that label converters are going to be able to migrate from their conventional press to their digital press, that’s going to free up capacity on their conventional presses,” Dochstader says.

According to Ron Gilboa, director at InfoTrends, a print and imaging research and consulting firm, while the continually improving technology is helping digital printing’s growth in packaging, the evolving demands of the markets it serves are leading to more converters seeking out a digital solution.

Among these demands are an increase in customized packaging and a drastic influx of SKUs within a product line. As digital printing closes the quality gap with conventional, Gilboa explains that converters will be able to more easily meet these demands.

“Versioning and small batch manufacturing is becoming a reality,” Gilboa says. “One of the things we see that’s going to fundamentally change how companies do business is digital products are on par with traditional products in quality and allow brand owners to very quickly react to consumer demand. That will pose a whole new thought process on the converters.”

What Converters Want

As part of a recent survey conducted by LPC, Inc., which received feedback from more than 250 label converters, Dochstader reveals that participants were asked to rank certain criteria they would consider when buying a digital press.

Unsurprisingly, the No. 1 answer was print quality. However, for the first time in the survey’s history, the No. 2 answer was service, surpassing press speed, which dropped to No. 3.

Dochstader explains that while press speed is still a highly important element of digital printing, it seems that the playing field is starting to level off in this arena. Converters are now more concerned about the reliability of equipment if they do make the purchase.

“Right now there are an awful lot of label converters talking about digital press technology,” Dochstader says. “For companies that don’t have a digital press on their production floor, they’re contacting companies that do. They’re asking questions like, what has your experience been? How often is your press down? What’s your average down time due to service issues? When you have a service issue, how long do you have to wait for a part?”

Another method of incorporating digital printing that is coming to the forefront now is by looking at hybrid options. In recent months, some of the biggest names in flexo printing have released presses that combine flexo and digital technologies, incorporating the best of both worlds.

Bob Leahey, associate director of InfoTrends, points to recent releases such as the Mark Andy Digital Series and the Gallus LabelFire 340, which came together through a partnership between Gallus, its parent company Heidelberg and Fujifilm.

“It’s inspiring to see that some of the top suppliers in the category where digital is most established — which is the label industry — are taking digital as part of their offerings and trying to fold it into these hybrid flexo inkjet presses,” Leahey says.

Looking beyond the addition of the technology, Gilboa explains that the ability to make the necessary workflow changes that digital printing provides becomes paramount. By adding digital, typically new short-run jobs come with it, and managing these new jobs can be a tall task.

“It’s not simple,” Gilboa says. “It has to be completely automated from beginning to end without any hand-touching in between the brand owner submitting the jobs, the factory approving the jobs and then the jobs being produced and shipped to their destination. When you’re dealing with small batch orders, you need to be able to be very nimble.”

Karstedt explains that the key to getting digital package printing mainstream beyond labels will vary by application. For example, he says that in the corrugated market, there are multiple single-pass digital printing options on the horizon.

At the moment, Karstedt explains, corrugated digital printing is primarily relegated to specialty applications, due to the need for the printhead to scan the substrate multiple times.

“Single pass will be the hurdle,” he says. “Once they can get to that, they’re into production speeds and no longer doing just short-run specialty kinds of things. They’re doing production work on corrugated.”

Likewise, Karstedt says digital printing will face a similar obstacle in the folding carton market. It’s no longer a matter of producing short runs for a specialty item, but being able to implement the benefits of digital at production print quantities.

“Everyone wants to get to production length folding carton,” Karstedt says. “They want to be able to do 5,000 cartons or 8,000 cartons effectively and efficiently and make money on them on a digital press, as well as being able to make every carton a little bit different by putting variable data on it or using QR codes.”

Generate the Buzz

With digital printing technology continuing to enter the marketplace, the next step is to make sure the entire supply chain understands that this is technology they can use to their advantage.

Boer explains that much of the responsibility falls onto the supplier to drum up excitement and educate about digital. He says that because the packaging design process has so many layers to it, figuring out whom to target when it comes to explaining what digital printing can do becomes a complicated question.

“Who do you ping to make them aware of the fact you can print to get them short run or high variation?” Boer asks. “Do I go after the creative agency, brand or converter?”

Boer explains that during digital printing’s gradual rise, marketing to the brand owner is one area where he says suppliers are missing out. While there has been plenty of digital technology on display at recent Graph Expos and drupas, not much has been on the floor at consumer product goods-based events.

“When C-level executives embrace it, that’s when things get rolling,” he says. “If you look at a major consumer goods show, somewhere where you might go to exhibit new foods, I’m willing to bet there’s no digital printing technology at that show.”

Dochstader explains that LPC, Inc. frequently contacts brand owners to gain a better understanding of what their perspectives are on the printing process. She says that for the most part, the brand owners she has been in contact with do not have a preference as to what process is used, as long as the quality is acceptable and the price is right.

What is interesting however, Dochstader says, is that over the past year, she has found more brand owners are intentionally seeking out converters who have digital capabilities — even if their packaging is printed conventionally.

“It is an asset to be able to print digitally because of how it complements [conventional],” she says. “You have to be able to meet all of the demands of your clients and you never know when those demands will encompass something that’s printed digitally.”