It wasn’t that long ago that we could read articles like this one about how the impact of the internet wasn’t that profound. A few graphs published in the last month illustrate a different story.
The first is from a Lexington Institute article with the ominous title POSTAL TRENDWATCH Q3 2011 – USPS Looks To Congress To Avert Bankruptcy.
A $3.1 Billion net loss in Q3 followed $2.2 Billion net loss in Q2, which won’t be the last. Why is bankruptcy imminent unless Congress bails them out?
According to BtoBonline.com, “The Postal Service continues to hemorrage money, due largely to changing consumer and business communications that rely on electronic communications instead of physical mail”.
It’s not only communications that are changing; also changing are mundane tasks like paying bills. 2010 marked the first year electronic bill payments outnumbered mailed payments. This overall trend represents a 50% decline in First class mail over the last decade.
The next graph reflects the state of the commercial print industry and comes from our friends at WhatTheyThink / Dr. Joe Webb.
There is a bit of good news amid the overall dismal trend. Print shipments (shown in red) continue to fall, but profitability has bucked the trend since Q4 2009.
Profitability has followed a massive consolidation in the print industry that reduced overall capacity chasing too few print jobs. Aggressive cost-cutting measures in combination with a migration to higher margin online services (i.e. purls) has helped keep those left afloat.
Obviously, if print volumes continue to fall, overcapacity and pressure on margins will impact the remaining printers until a new round of cost-cutting and consolidation takes effect.
The recession has spurred the dealers and retailers that use our Marcom systems to explore cheaper, more accountable online options to get their message out to consumers. Online banner ads, Email, Facebook, dealer websites, promotional landing pages are all growing in popularity. The Marcom or Ad builder site automatically enforces best practices, protects the brand message, tracks effectiveness and makes the overall process easier.
Your channel partners aren’t going back to the 1990’s. Online behavior will continue to grow and evolve. We are witnessing a profound change that will continue for years to come.