VDC Research: RFID, Barcode, Retail Automation & Self-Service Market Blog

VDC Research’s Takeaways from the 24th Annual IMI Thermal Printing Conference

I recently presented at the 24th Annual Thermal Printing Conference in Scottsdale, AZ (link). The only one of its kind, this conference is dedicated to thermal printing – with industry veterans coming together to discuss historical performance, current and emerging product development trends, market expansion strategies, and their collective vision for the future of this industry. Ongoing advancements in wireless communication, electronic documentation, and mobile device innovation (and adoption) will have a significant impact on the thermal printing market, with the potential to revolutionize the way vendors and their partners approach their sales and business development initiatives. Here are a few highlights from Day 1 of the conference (the only one of three that I could attend):

1. Harold Schofield’s State of the Industry Address – Harold has been a key influencer at this conference for more than 2 decades now and has consistently shared an update of the evolution of the thermal printing market at the start of every conference. This year, his presentation provided an overview of vendor performance in the thermal media and printer market, enterprise trends within each of the primary verticals (and print applications), and an update on technology developments. Vendors are keen to optimize thermal technology use – designing solutions to address newer, specialty applications including two-sided printing, color printing, and higher resolution printing.
2. Mobile Printing for the Connected World – I discussed VDC’s coverage of the portable thermal printer market (read more here). With a focus on key trends, applications and innovations driving adoption in diverse installation environments, I shared my thoughts on what’s new, now and next for the mobile form factor. The discussion was largely centered on the mobile point-of-sale application, wireless connectivity options, consumer device pairing alternatives, and empowerment of the global mobile workforce. Mobility is the future. What does this mean for enterprises lower down the proverbial pyramid? We firmly believe vendors who collaborate with these smaller firms to develop products that meet their unique requirements will achieve tremendous success.

This conference has proved to be a good platform for networking with industry leaders, while also helping gain an insight into the future of the thermal printing market – in terms of new technology/solution developments, new target markets and applications, and evolving enterprise investment considerations. Looking forward to attending the next one in 2014!

Preview of VDC's Mobile Printers Report

The global mobile (portable) printer market will see high single-digit compounded annual growth rates through 2017 from a base of $265 million in 2012. These devices will remain key growth markets for vendors and their channel partners, as end-users ride the mobility wave. Workforce mobilization and related requirements will spur current and anticipated product development enhancements, requiring support for various mobile operating systems, and seamless integration with various transaction-enabling solutions and contactless technologies like near field communication (NFC). Increased adoption of mobile printing solutions will not be concentrated in any one vertical market. In fact, the mobile transaction printer industry is faced with equal parts growth opportunities and challenges due to highly fragmented usage environments, customer types, and device configurations. The ongoing introduction of consumer-grade devices into the enterprise will present roadblocks while also driving hardware and application innovation. In order to align product and market development strategies with evolving user requirements and preferences, increased investments in R&D, distribution channels, and solution partnering are critical to capitalize on the significant opportunities that lie ahead.

Although the mobile printer market is not commoditized (yet), VDC expects the heavily fragmented competitive landscape to pose significant challenges to the vendor community in terms of attaining desired revenue growth and improvements in profit margins. An exclusive focus on hardware innovation alone will not be a sustainable business development strategy in the long run. Application development targeted at making it possible for the workforce to send print commands using any mobile device, on any printer, should be vendors’ goal with mobile printing. This will protect suppliers from shrinking hardware margins and losing valuable customers while generating a relatively lower cost and more profitable revenue stream.

To learn more about this forthcoming research report, click here.

The AIDC Top 20 by Modern Materials Handling in Collaboration with VDC

Modern Materials Handling teamed up with VDC Research for the 5th year in a row to publish their 12th-annual “Top 20 Automatic data collection suppliers” article, examining the state of the Auto-ID market and the leading manufacturers in the industry. MMH used VDC’s extensive research in the field to compile a list of the top 20 suppliers and to provide analysis of the industry at large.

The global AIDC market reached $11.264 billion in 2012, a 3.9% increase from 2011. VDC projects the industry to grow at compound annual growth rate of 7.5% through 2017, fueled by new customer interests, increased competition and opportunities in emerging markets.

The top 20 list featured a host of familiar faces, with Motorola solutions once again coming out on top, with 2012 AIDC and mobility revenues of $1.348 billion (est.), and Zebra Technologies taking second with $592 million in revenues. Honeywell, Datalogic, and Intermec round out the top five. In order to be included in the list, vendors must sell in North America and must focus on supply chain solutions. Though the list did not change much from last year’s (only Datalogic and Intermec swapped positions within the top five), consolidation among vendors could give next year’s list a shake-up. Notable changes include Honeywell’s acquisition of Intermec and Motorola’s acquisition of Psion.

Despite the snapshot of industry vendors being largely unchanged, VDC analysts point out a few key trends in the scanning, barcode printing and RFID markets that are changing the landscape. The migration of customers from laser scanners to camera-based imagers stands out as a major trend, with the market for camera-based 2D imaging solutions expanding by more than 30% from 2011 to 2012. The commoditization of barcode printing technologies also stands out as a significant market trend; driven by stagnant technologies, price pressures, and a fragmented competitive landscape. The market for mobile printing, though, jumped double-digits year over year, while the rest of the printing market remained relatively flat. In the RFID market, which grew nearly 13%, the big story is in apparel tagging, with retail customers using RFID for shipping and receiving operations in addition to the more traditional inventory control applications.

New opportunities in emerging markets and innovative applications stand to drive growth the AutoID and Data Capture industry in the near future. As competition continues grows and prices continue to drop, differentiation looks to be key for business continuity and profitability.

(A special thank you to Scott O’Leary for his significant contributions to this blog post. Scott is currently a Research Assistant in VDC’s AutoID & Data Capture practice.)