Label printing in India: Digital has to wait a while!

India has been termed as perhaps the fastest growing market for printed products in the world. According to the NPES/PRIMIR World Wide Market for Print study, published by the Economist Intelligence Unit, “the size of India’s print market will be USD 29.3 billion in 2017 up from USD 24.3 billion in 2014. Print market growth in India has slowed down since the global financial crisis, but the market will continue to grow over the period through 2017; total print product revenues in India will grow at 6.8% annually through 2017”.

Digital printing accounts for 15% of all printed products globally. However, as for India, given the late start and slower adoption of new and fast changing technologies by the cautious print fraternity, even if we make a moderate estimate, the market size for all the digital printed products should be within USD 3-4 billion. This is my personal estimation but if I take predictions and estimation of industry leaders, it appears to be relatively accurate. Pankaj Kalra of Xerox stated in 2012, that “the size of the digital printing market is estimated at USD 1.5 billion now and is expected to grow to USD 2.5 billion by 2012-13”, clocking a whopping 70% growth! The packaging and label segment account for over 40% of the total printed products in India and the segment is growing at 15% against a global growth rate of 5%.

Middle class and cultural diversity as growth drivers

Most of the growth is expected or is coming out of the bulging middle class in India. It is a consumer

segment that is turning out a literate and young workforce with disposable income and a long residual working life indicating stability. This young workforce is exposed to the internet and wishes to indulge in modern day retail spending, driving amazing demands for consumer products and also for labels and packaging.

India is a large country having a population with diverse cultures and religions. In addition, similarly different cultures have different festivals. Retail marketing professionals are formulating ways to tap the selling opportunities such occasions offer. It is at this time customized short runs become the need of the hour. The print on demand capabilities of digital printing provides the perfect solution to such requirements. Consumer product companies can offer limited edition packs with regional festival branding. It is one such example of things that are driving that tremendous growth into digital printing in India.

The impact of digital printing

While digital printing has made its impact in the Indian sheet fed printing arena, yet it still does not have many takers in the narrow web label printing. Most of the established offset printers have more or less enabled themselves with digital capabilities for not just proofing but also to cater to their customers who need short run jobs. Otherwise customers would start looking elsewhere to get short runs done. Customer retention is a very important requisite for successful print firms with large capital investments. They cannot afford their customers to go to other printers for short runs as this way they are liable to lose their bulk business as well.

The reason for small digital printing companies for sheet-fed mushrooming all over the country is that most of the large offset printers are still focused on their high volume customers and they acquire some digital capabilities to address the needs of existing customers. The smaller consumers needing just the short runs, have created a demand to cater to this need, small digital printing outfits have come up in colonies and markets in all big cities in India.

I believe sooner or later the bigger players in the organized segment will indulge in tapping this market in an organized manner offering services at the smaller customer’s door step on demand. Obviously these are game changing times and that is what makes the Indian printing stalwarts go on the defensive. The sheer ever changing and evolving nature of electronic technologies makes them apprehensive. They fear their equipment will become obsolete before they can say they got their return on the investment.