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In the early days of digital label printing, one of the main reasons for switching from analog to digital was short-run economics. Digital printing meant it was no longer necessary to over-manufacture labels to be able to run a very short job economically. However, technological advancements have provided additional incentives for switching from analog to digital when it comes to printing labels.<\/p>\n
Last year, we sat down with Paul Edwards, Vice President of the Digital Division at INX International Ink Co., to find out why digital print could potentially grow to 15% of label sales in 2025. We recently sat down with Paul again to ask 1) if digital label sales grew as much as he anticipated and 2) what he thinks lies in store for digital label sales going forward.<\/p>\n
Paul:<\/strong> INX continues to view Digital Label technology as complimentary to the analog techniques of today. While it is clear there are some areas which overlap, in general terms the two technologies have different key drivers.\u202f<\/p>\n Regarding the labels segment growing to 15%, I believe a reasonable consensus would agree it was achieved.\u202fThere is also the consideration of the volume percentage of the market compared to the overall value percentage. Here I would expect the volume to be slightly lower than 15% and the total value slightly higher than 15%. I base this on the likely better margins that are being achieved for digital products.<\/p>\n Paul:<\/strong> In terms of continued growth, estimates for the growth of digital labels versus analog in general indicate\u202fa likely CAGR of around 8%. This percentage signals that 20% growth by 2030 would be a reasonable target if we continue to experience the economic conditions we are seeing today.\u202f<\/p>\n I look at the history of Digital Labels and believe a slow, consistent growth to be the key feature of this application. While there are more aggressive estimates of future growth, I do not see a driver to achieve current higher levels.<\/p>\n The foremost secular driver today is continuous decreases in the average run length, which has been a feature of this market from the start. The second is digital content. It is an important driver that is becoming more visible to a greater extent, with brands wanting to differentiate themselves with targeted marketing and the ability to use QR codes to access digital content.\u202f<\/p>\n Finally, we should consider the sustainability factor. The digital process inherently provides some sustainably benefits related to reduction in waste. However, the recent availability of new renewable substrates may soon start to be felt.<\/p>\n The likelihood is that these technologies will be implemented at lower volumes, which plays to the strengths and into the hands of digital print. In the opposite direction, there are advances in analog technology that are addressing shorter run efficiencies and waste. But I think this development just induces a little more friction against change and will not stop the advances being made with digital.<\/p>\n <\/p>\nPS: Do you have a similar forecast as to what percentage digital will grow by 2030? If it is 20% or more, what factors will influence it \u2014 those currently existing or newer developments? Please explain.\u202f<\/em><\/h4>\n