Madison Advisors has
    recently completed a comprehensive examination of the important trends in the
    Customer Communications Management (CCM) marketplace. While conducting this
    research, we have found that
    continue to struggle with the requirement for communications to be compliant, as
    well as more personalized and relevant, while striving to support complex
    products with clarity and appropriate calls to action. Combined with growing
    delivery expectations in the digital world, this requirement has caused many
    companies to fall behind as they attempt to achieve their strategic
    communication goals.

    Traditionally, companies have turned to
    software manufacturers in an attempt to enhance customer communications. While
    this approach may have been somewhat successful in the past, as communication
    requirements have become more complex, off-the-shelf composition software is
    failing to deliver the desired results.
    A new service delivery model is required in order to overcome the
    complexity inherent in the software and corresponding integration tasks; a
    model that can guarantee results and leads to the ROI organizations desire.
    Madison Advisors refers to this client engagement and technology delivery model
    as CCM Hosted Managed Services.

    In Madison Advisors' opinion, print
    service providers may have the best opportunity to get into the hosted managed
    services space and affect this market. Having been trusted partners of
    enterprise clients for years, in some cases providing composition, archival,
    and electronic delivery services, they are uniquely positioned to leverage and
    expand existing relationships. In addition, as market factors place additional
    pressures on many in-plants to consider outsourcing print and mail,
    opportunities for print service providers will continue to expand. As physical
    print has become more of a commodity, recent best practice has been for companies
    to take a printer agnostic approach to outsourcing. As contracts expire,
    companies want to be free to take advantage of more competitive pricing through
    movement to another service provider. If the print service provider also does
    the composition work, the transition process becomes more complicated; and
    timetables are extended as these services are unraveled and ported to a new
    provider. In some cases, the complexity of the move causes companies to forgo
    the savings and remain with the current vendor. For this reason, many companies
    have elected to keep composition and other upstream tasks in house. This is also
    fraught with challenges; and, increasingly, companies have turned to CCM Hosted
    Managed Services providers to achieve the desired outcomes. Madison Advisors
    has recently assisted a large client with the selection of a CCM Hosted Managed
    Services provider, and subsequently ran the RFP to move from one large print
    service provider to another to take advantage of downward movement in price. We
    believe this will be the trend going forward. Print service providers may
    continue to fight this trend but would be better served to execute a strategic
    pivot and reposition themselves in the market. Rather than being providers of
    traditional print services, they should establish themselves as CCM technology
    service providers with print being a separate and distinct offering. To a
    degree, this is already true as many print service providers offer additional
    services including electronic delivery, archival, and, to a limited extent,
    business user control of messaging and variable content. However, these
    offerings have been viewed as bolted-on services, inextricably linked to
    traditional print and mail services.

    Some forward thinking companies are
    beginning to take the plunge. One very large traditional print service provider
    is in the early stages of rolling out its CCM Hosted Managed Services offering.
    Several others are exploring ways to partner with existing providers.

    Madison Advisors believes that print service
    providers should further embrace this market shift to create a new model of
    printer agnosticism by separating upstream and digital services from physical
    print offerings. For some companies, this may be a difficult transformation as
    it may be seen as taking their eye off the ball or cannibalizing existing print-based
    revenue streams. However, until they are willing to let go of print as the
    primary business, these service providers will be watching this market continue
    to evolve and expand from the sidelines.