In the world of production, 2007 is shaping up to be just as challenging as 2006. Digital workflows, ad portals, mailing strategies and supply-chain management loom large this year. And what might compel publishers to ramp up their new technology adoption rates, as Time Inc.’s Guy Gleysteen notes on page 50, is the fact that many publishers have maxed out physical adjustments to their magazines;trim size, paper weights, and the like. "We’ve been down most of the avenues for cost management and there’s not a lot left in them," says Gleysteen.

Yet, for some publishers, more can still be done in this area. CMP’s Marie Myers has had great success through a co-binding initiative she’s sharing with U.S. News and World Report. She plans to use this strategy with more of her titles. And Verso Paper’s Sharad Agarwal suggests that, while paper weight adjustments are certainly cost-effective, there’s still work to be done in reducing learning costs associated with new product introductions at the vendor level. "There could also be a more synergistic approach in terms of innovation in each of our industries to take the learning costs out of the system," says Agarwal. "Building relationships that extend beyond the purchasing function will lead to greater communication and alignment."

David SteinhardtPresident, CEO, IDEAlliance

In the postal arena, the flat-sequence sortation system is going to really change how magazines look at distribution. There’s a lot of ongoing work in the supply chain;carrier-route sortation, address-label placement;coming in over the next couple of years. Publishers really need to stay on top of the Postmaster General Mailers’ Technical Advisory committee (MTAC). There is a special task force around FSS. It’s a team of people from the USPS and the industry that see this as an integrated supply chain issue, figuring out what the dots are and reconnecting them in a different way. That piece of equipment is going to change sortation and address labels. It’s a key thing for publishers to work with in concert with their printers to take a look at.

The postal-rate increases that will be coming down second quarter this year are going to pressure publishers to look at things differently in two aspects. One is address quality and the other is different distribution networks for magazines as it relates to co-mailing. To get the discounts, magazines may need to look at combining or co-mailing with other publications. The implications will be matching sizes and weights and working in concert with printers to get the discounts.

The publication world, as everyone knows, is being impacted by digital media. Over the next several years the implication of repurposing content is going to be a key issue for the competitiveness of print. A key element to this is that publishers are going to be seen as brands of content information. How does that content get tagged in a way that it can move to print or to the Web or to mobile telephones? Specifications such as IDEAlliance’s PRISM are going to become important for the monetizing of content. And production, manufacturing, and distribution silos within publishers are going to have to work in concert with the digital media silo.

We need to think about "intelligent media" and "informed workflow." There’s been a lot of talk about using supply-chain specifications such as JDF and PROSE and the implication for using those specifications is to automate the production process. The difference is that systems across the supply chain are based on legacy data models and the key element to redefining that data model is going to be metadata and how metadata can be tagged to media and its workflow. That is a key initiative for IDEAlliance in the coming year to work on. We’re working with a number of advertising agencies, printers and publishers on that.

The entire supply chain must work cooperatively in connecting that workflow. Industry groups and all parts of the trading partners in the supply chain will need to take some walls down to come up with different approaches to connecting the supply chain.

The industry is still facing getting print predictability as defined by the client. Clients upstream, whether an advertising agency or brand owner, are dictating more downstream that they seek a better-defined manual process that leads to print predictability. What we need are tighter tolerances for color and tolerances that can be better communicated across that supply chain for better soft proofing. We also need better tools to predict color by substrate;there needs to be better definition of colors that you want on those substrates.

Marie MyersSenior vice president, manufacturing, CMP Technology

On the top of my mind this year are the postal increases that are coming and how we’re trying to control them by changing our process. I don’t think paper pricing is going to be much of a threat this year. It might even go down a little.

One process-focused initiative we’re looking closer at is doing more co-binding with other publications;putting two publications on a selective binding line. Demographically, you combine your books and then the machine will fire whatever pocket is necessary. It comes off the machine in postal order with more than one publication. You have to work with the other publications that you want to co-bind with. You have to have the same trim size, schedule, and be within a certain range in page size. So on our weekly Information Week, we’re co-binding 33 out of 50 issues a year with U.S. News and World Report. We’re saving hundreds of thousands of dollars.
I would like to look at that with other titles, it’s gone very well. A lot of it may be because the printer was committed to this.

Co-mailing is a big one. You should push for every possible book to get into co-mail. We’re estimating a 13 percent savings and since the increase is going to be 11.4 percent it’s a win-win for us. There’s a certain point where you might not save money, it’s an ad percentage. So if your books are small and the ad percentage is not that much, it might not save you any money.
We’re also installing an ad portal of our own. We already have an asset management system where we store our own materials. Now we want to get these assets delivered to us without a messy FTP site. That’s our big project for this year. One big benefit is the ad portal will flight check the materials before we accept them.

Things you want to avoid? Don’t put your publication into a single entry at the post office. And when you have multiple workflow changes, don’t do them all at once. Test each one first. An example is if you are changing platforms and layout programs, do not do them both at the same time. And test, test, test.

Charles BlanchardCEO, Blanchard Systems

Production departments should still be focusing on the things they do, they should just be focusing on doing them more efficiently. What we tell our customers is to try to do more with less;less people, less time. In general, if you produce your titles twice as fast using more efficient automated workflows, it stands to reason that you can do the same work with half the people.

Many pieces of an automated workflow system can accomplish this. For example, soft proofing eliminates the necessity of moving physical pieces of printed artwork around, sending them with overnight couriers. This cuts a lot of time when sending one iteration of proofs. Imagine if there are three, four, or more. Even remote hard-proofing technologies, if you’re willing to invest in printers at remote sites, can be a time saver.

Another way to be more productive is to get advertisers more involved using preflighting, proofing, automated ad portals and ad workflows that check for simple things, such as correct ad sizes. A good workflow can preflight the specs of an ad based upon insertion/production information;which can be automated using XML metadata;primarily ADsML, digitally pulling insertion information and including it in ad artwork.

Cutting out the middleman and taking responsibility for publication production shortens the production cycle while lengthening the ad sales cycle;a double benefit adding to the top line while eliminating costs, and leading to increased profits. We have found that even smart, collaborative production systems, particularly for publishers who work with satellite offices, can help. Internal private virtual book production systems operate through Web portals, while parallel systems provide an open, external system for advertisers. Combining them isn’t difficult and the rewards are great. There are systems that do this already, utilizing standards where available and helping to create them when not.

For those who can get a portion of their circulation base to agree, a parallel workflow can be created to produce virtual digital editions, sent electronically to eliminate postage. By developing XML content as the book is created, additional perks can be included, such as hyperlinks to ads, dynamic links to more content, or even embedded rich media such as audio and video. For publishers who are able to work with reader data, advertising in these books can be changed to meet demographics.

All these solutions can reduce costs and, in some cases, even increase revenues. They just require good planning and a willingness to accept new best practices.

Guy GleysteenVice president, paper and digital development, Time Inc.

I think that as a baseline, 2007 is going to be as tough as 2006, so the pressure on production departs will be as great or greater than last year.

We’re focused at the umbrella level on strategies that lead to cost-effective automation. These would include electronic insertion orders, Web-based ad portals, and the elimination of hard proofs and use of virtual proofing. It’s taking steps out of the production process and leading to sensible automation. Sensible, meaning they have a defined set of tasks around them and a clear benefit if you can eliminate those tasks.

We’ve taken, collectively as publishers, already a lot of mileage out of negotiating print contracts, reducing trim size, and eliminating complexity in magazines to drive costs down. We’ve been down most of the avenues for cost management and there’s not a lot left in them. What’s left is the process by which advertising is placed in magazines and how materials are submitted, and in turn, the process of proofing. If you go into a printing plant today, the plate making is all CTP and software, not operators, fundamentally controls the process. But if you look at the front end at the publisher it’s 1955. It’s where the most opportunity is and it’s going to be where the most change is available.

What should you avoid at all costs? The same thing you were doing three years ago. If you can identify something in the production process you’ve been doing the same way for three years, you need to change it.

Sharad AgarwalProduct manager, coated groundwood, Verso Paper

We have seen a trend where publishers are increasingly more focused on managing costs. From a paper standpoint, this is normally achieved by moving down in basis weights. We have seen some rather aggressive reductions in basis weights. This trend, however, has been less noticeable to the end-user as new innovative products such as high-bulks, enhanced high-bulks, and lighter weight No. 4 products are utilized to facilitate the distribution savings while maintaining the look and feel of heavier weight papers.

Other areas that we have seen customers optimize costs are in the supply chain. Some of this is through roll standardization and inventory reduction. In some cases, when two roll sizes are similar, the customer has gone with the slightly larger size, thereby reducing two inventory items to just one SKU. In other instances, the customer has worked with the printer to aggressively reduce required trim waste. This allows for a smaller roll size, but lets the publisher maintain its book size. This second option has the added benefit of less paper usage.

There could also be a more synergistic approach in terms of innovation in each of our industries to take the learning costs out of the system. Now, if a paper maker comes up with a new product the presses have to reactively adapt to it, rather than proactively adapt to it. And, likewise, when printers make a change the paper makers have to reactively change their products rather than proactively design the right products. There is an opportunity for more collaboration. It’s getting better, but I don’t think we’re where we should be as an industry. Continuing to build relationships that extend beyond the purchasing function will lead to greater communication and alignment.

Q&A: Tom Fox,VP Manufacturing & Technology, American Express Publishing

Fox, who is also chairing IDEAlliance’s Primex conference this month, shares his company’s production priorities and how the rest of the industry is faring.

FOLIO: What’s top of your mind in production-related issues for 2007? What’s at the top of your to-do list for this year?

Fox: The number-one thing taking up most of my time is we set a goal for the company in the middle of 2006 to be at 100 percent assigned digital photography by January 2008. It’s a lofty goal and somewhat of a challenge. Right now we’re assessing the digital readiness of our photographers. The biggest challenge is dealing internally with photo editors to support the digital process in a cost-effective way.

It’s actually been fairly easy to remove the obstacle of the creative concern over the finished product. Digital photography has been adapted enough that there are very few people left that will argue film has a superior quality. Being able to convince people of the aesthetic has been easy.

Another challenge is the practicality of it;portability, equipment, skill and knowledge of the photographers. Plus the cost of also having a digital technician. And then closer to home, the biggest piece is do we have the systems and processes in place for viewing and editing electronically and then archiving?

FOLIO: Aside from cost, what might be another motivator for other publishers to adopt a more digital workflow?

Fox: Common sense. Our industry is notoriously slow to let go of what is familiar. We also get easily swayed by negative experiences. The reality is that some of the digital photography has been problematic because there have been problems on the front end. People use that as a reason to stay status quo. Having an all digital workflow is a common sense view of the future. We’re trying to facilitate that so we get there ahead of time.

It’s critical for our industry to bite the bullet. Even if it’s more expensive in the beginning. Who’s going to argue that a digital workflow will not have a cost benefit down the road?

FOLIO: How would you compare your efforts to those of the rest of the industry in these areas?

Fox: I would tend to believe I’m personally more aggressive about these things. It’s much more my nature to challenge. I think everybody is getting the same challenges in terms of reducing costs. If ad rates were growing at 8 percent no one would be talking about reducing costs. Eventually the things you never thought would change, do change.

FOLIO: Are these issues similar to those being addressed at Primex this year?

Fox: What we’re going to try to do is less about what we’re going to talk about than how we’re gong to talk about it. What we have been great at as an industry is pointing out why any new idea won’t work. We want to instead create an environment to try to accept that yesterday’s impossibility is tomorrow’s practicality. We have a topic on using environmentalism as a profitability strategy, for example. No one should sit there and talk about how you can squeeze money out of the printers. It should be how can publishers be willing to change what they do and have the benefits come from the supply chain backwards?

It’s more important for the conference to reflect that it’s less about the details of a particular technology and more about its influences. Is there a rationale that can become broadly accepted? We’re not debating why but how.

Creating New Revenue with Content Marketing and Native Advertising
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If your business remains print centric, dependent on legacy formats like full-page print ads, then content marketing and native advertising…