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.

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.

PS: INX views digital packaging as complementary to conventional techniques, not as a replacement. Has it continued to gain momentum in the past year, and did label sales grow to 15% in 2025? If not, can you interpret why?

Paul: 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. 

Regarding the labels segment growing to 15%, I believe a reasonable consensus would agree it was achieved. There 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.

PS: 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 — those currently existing or newer developments? Please explain. 

Paul: In terms of continued growth, estimates for the growth of digital labels versus analog in general indicate a 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. 

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.

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. 

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.

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.

PS: Are there different economic factors from a year ago or in the foreseeable future that could influence digital growth? Or is this speculation that you do not want to answer?

Paul: Predicting the future is a highly speculative activity and it is clear the world today is in a very volatile time. If an economic slowdown occurs due to general growth and is connected to world events, then I would see this as a simple headwind for the volumes of labels being produced. However, what we see in times of reduced demand are the secular drivers I mentioned previously that are unlikely to be impacted. They may even be enhanced in some cases.

For example, if label customers want to carry less stock and become more focused with on-demand printing, you can certainly see how there would be a driver for greater digital output. Similarly, at times when competition becomes fiercer and brands are fighting harder for sales growth, the utilization of new technologies such as digital content could give them the edge. Therefore, we can reasonably assume digital growth could be enhanced percentage-wise.

PS: Are more brand owners, converters, and stakeholders considering or moving to digital because of the improved print quality in terms of sharper color and better inks? Are more investing in digital because of the advances in technology.

Paul: Print quality has improved significantly in recent years and is generally at a point of being acceptable for most end-user applications. There are clearly some benefits in terms of process color technology providing the option of having many more colors in a single artwork, as well as with having improved color transitions for near photo-quality work.

Inks have certainly developed over time to address the demands of the equipment and some regulatory issues. Developments in ink and system technology also allow for greater product enhancement and differentiation by utilizing other forms of embellishment, such as spot gloss and digital foils.

Overall, it is the development of the technologies that is enabling greater opportunities for product differentiation. This makes it attractive to brand holders, who will drive the greater investment that is needed. The creation of added-value products is also important for converters in order to grow a profitable business.

PS: With recent technology developments in the past year or two, to what degree have hybrid systems improved? And what other possible advancements might occur by 2030?

Paul: There is quite a selection of hybrid analog and digital label presses in the market now, so there is a good variety of options for a converter to chose from. Most advancements seem to be related to adding to the processes and embellishments that increase the capabilities of the presses, as well as the potential differentiation with additions such as spot gloss, foiling, and the like. These systems are designed to provide maximum capability and, in many cases, have the ability to carry out all the processes. This would include delivering a final roll of converted labels with more recent advancements in digital laser die cutting.

By 2030, I can see the systems continuing to become more efficient and compete more strongly against the analog printing process. There is a trend toward interest in water-based technology, so I expect this may be one of the main advancements over the next few years. Another one addresses a different look to the labels with lower pile height, as well as having the potential for a good regulatory profile which could benefit indirect food contact applications. 

PS: Is the market moving toward more of a hybrid production environment where converters want to use the right technology for the right job? 

Paul: Yes, the hybrid systems do allow for a wide range of processes to be carried out and create whatever look is required for the final product. Different technologies do mean you can choose the right technology for the job on one printing system.

For example, with a multicolored photo-realistic image, you would likely want to print it digital. But if the label is mostly one-color with some minor digital content, that one- color can be preferentially printed using an analog spot color. One system can now produce some good volume jobs as well as small volume, but with highly differentiated artwork.