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Strategy Session: HP--Cut the Cord and Grow Your Printing Profits

HP's Kalle Marsal Discusses Creative Product Options for Retailers

June 2012
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Kalle Marsal, WW Director of Marketing and Product, Retail Publishing Solutions, HP, has a lot invested in the success of printing at retail. With the rise in digital sharing, the demise of the 4x6 print and so many new opportunities for people to create exciting end results at retail, I sat down with him to explore how retailers can once again get their customers involved and motivated about printing.

What do retailers have to do to drive printing profits in today’s “photo-sharing” environment?

Kalle Marsal: In a lot of ways, we must all change our mindset of where profits will be coming from in the future. Across the board, we are seeing the market value of photo prints declining, primarily from the pricing destruction of the 4x6 print all over the world. In places liked Australia, the volume is actually up, but the pricing is down. In the U.S., pricing is steady, but it’s so low that it’s difficult to make money.

The other issue was the rush to promote non-4x6 products. The initial quality of creative products was not that good, and the process was arduous. The products coming out of cheap laser printers were disappointing consumers, so initial early adopters were not turned into repeat purchasers and advocates.

We’re much better now; we have improved in areas such as automation and artificial intelligence that can help photo selection. For example, if you have 300 pictures that you’re choosing from, our software should be able to pick out the 50 best pictures for your choices and group them effectively. And there have also been improvements in the quality of the paper, the vibrancy of the colors, quality of the bindings in books and an expanded selection of themes and designs. So we are closer to where we should be.

So where is the opportunity?

We have to truly accept that the 4x6 print will no longer carry this industry. Most people in the industry subscribe to this notion, but not enough are acting accordingly. The shift is going to have to be to a portfolio of printed products that together will significantly drive volume and profit, and one that isn’t constrained by the investments and operating models focused on driving 4x6 prints.

We have seen significant growth in what we call “photo creative”—photo books, posters, calendars, cards and different kinds of wall art. And the growth is impressive.

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