VDP: Value vs. Price

How should in-plants charge for variable data printing? That topic on a listserv prompted the following response from Tom Tozier, director of Imaging Services, University of Colorado at Boulder (reposted here with his permission).

Many of our customers today equate everything to “click charges.” It’s a result of living in a digital age. As VDP evolves and becomes more accessible and understandable to a larger market, VDP providers such as ourselves are going to find that a “price matrix” (one size fits all) pricing method just isn’t going to work (or pay the bills).

As I develop a new price model I am trying to solve problems such as:

• Is a variable graphic field the same has a variable text field?

• Should the prep costs for text and graphics be the same?

• What is the cost to us and the value to the customer for prepping those data files?

• What about hidden costs?

One question I don’t hear a lot is “How do you price ‘fixing’ all those data files?” I mean, do any of us really think that customer supplied data files will be “VDP ready?” That’s kind of like expecting all files to be “press-ready.” We shouldn’t think that manufacturing costs can be the direct driver of pricing; there are too many other intangibles.

I think that David Erlandson, speaking at PODi’s 2010 App-Forum conference, hit the nail on the head when he advised that we should move way from “click rate/page price” and towards a “marketing services approach to selling and pricing jobs.”

I think the bottom line for pricing may be two factors:

1. Click charge to print.

2. Value proposition for the customer for VDP development.

After all, what end result of a project does the customer expect, and what is that worth? If a targeted VDP mailing saves Admissions $10,000 from the old static “blanket mailing” they are used to, what is that worth?