At this years PMA show, our goal was to show our customers how they can grow their photo specialty printing business. The booming growth in digital photo books and specialty products is all the more impressive in the context of the difficult challenges in today’s traditional film and commercial printing markets.

Photo specialty products include photo books, calendars, greeting cards, trading cards, posters, refrigerator magnets and just about any alternative to a standard, one-sided print on photographic paper. These alternatives are well on their way to becoming the standard for photographic output.
While film processing revenues peaked in 2005 and are expected to drop by about 5 percent annually through 2011, specialty photo products are projected for 24.5 percent compound annual growth, according to market research firm InfoTrends. And while traditional offset printing — and even some digital printing — has increasingly become a price-driven, commodity in recent years, photo products can cost pennies per page to produce, yet sell at dollars per page, with margins ranging to 80 percent and more.

Clearly, the photo books and specialty market is a huge opportunity. But keep in mind that some big players already have staked out some very lucrative positions. Trying to take on the likes of Snapfish and Kodak Gallery — large, highly automated operations that have scaled to offer competitive pricing for the consumer market — is a bit like a mom-and-pop department store trying to compete with Wal-Mart. And by the way, Wal-Mart is busily carving out its own share of the general consumer market for photo books and specialty products.

The opportunity remains huge for many film processors and digital printers! However, the opportunity is not so much to compete directly with these players but to target niches that are under-served in today’s market. And there are many.

InfoTrends projects that the market for photo specialty products will grow by 5X from 2006 to 2010, with sales growing from about $200 million to $1 billion, as the early adopter phase gives way to a mass market. The most popular items today are photo cards and specialty prints such as posters, collages and large prints. But, photo books and calendars are projected for the greatest growth by a 45 percent compound annual growth rate from 2006 to 2010. Whatever the purchase, the average consumer spend on specialty products is a healthy $51.50.

Looking ahead, one thing is for sure – the photo specialty business is a great way to grow your business.

Brian Segnit
Photo and Book Marketing Manager
Xerox Corporation