The advent of 3D printing could revolutionize the relationship between retailers and manufacturers – and consumers. Is your company ready for the opportunity, and the threat?
By the end of 2013, Juniper Research says, the number of consumer-owned 3D printers reached more than 25,000 globally. This year sales are set to top the 44,000 mark. Such figures suggest the ‘3D revolution’ is behind schedule, due to a failure to develop “killer applications with the right eco-system of software, apps and materials”.
That’s about to change. The company also forecasts that global sales of consumer-owned 3D printers will exceed one million a year by 2018, due to the “ever widening scope of applicability, driven by the entry and growth of more established printing vendors such as HP”, falling prices and cutting-edge innovations. Due on the market this year at less than US$200, for example, the Mink allows users to print a bespoke range of eye shadows, lip glosses and blushers from any color they can capture digitally. After 2020, some studies suggest, more than half of households in the US and Western Europe will have a 3D printer.
This rapidly developing technology offers retailers the chance to engage with interested consumers in new, intriguing and hard-to-foresee ways. “The novelty here,” says Jerry Dimos, Management Consultant at KPMG in Singapore, “is that consumers are allowed to participate in the creation of the product and can obtain it quickly without waiting for it to be shipped from the warehouse.”
Office supplies company Staples has trialed this technology in Europe and now has 3D “printer experience” stores in New York and Los Angeles. In Japan, startup Fotofig has brought a new dimension to the selfie by enabling customers to create mini-figurines of themselves, family and friends.
In June last year, Paul Wilkinson, lead research specialist in Tesco’s IT R&D team, led a fact-finding mission to Silicon Valley to explore how the retailer could use 3D printers.
“We already print photos and posters in many of our larger stores, so why not other gifts and personalized items?” Wilkinson wrote in a blog. “How about letting kids design their own toys and then actually being able to get them made? What if we had a digital catalogue of spare parts for items you’d bought? They could be printed on demand and ready for you by the time you’d finished shopping. You could even take a broken item into a store, where we could scan it in 3D, repair it digitally and make you a new one. This technology could revolutionize the way we view stores and what we can get from them.”
Some grocery suppliers are experimenting with the technology. Italian food business Barilla is collaborating with Dutch company TNO to develop a 3D pasta printer. One potential application is cartridges containing pasta dough that can be inserted into a 3D printer to print customers’ own pasta designs.
In the US, confectionery giant Hershey has teamed up with 3D printing press manufacturer 3D Systems “to explore and develop innovative opportunities for using 3D printing technology in creating edible foods, including confectionery treats”.
Cathy Barnes, professor of retail innovation at Leeds Metropolitan University, sees enormous potential for 3D print for the food industry, particularly in personalization or customization, where vendors could charge a premium for their services.“
Gifting is the example that comes to mind,” says Barnes. “Not too far in the future we might see additions being personalized, such as greetings and messages printed in relief. We could also imagine a 3D-printed chocolate bar based on the drawings of a child.”
Dimos sees instant snacking as another potentially useful application. “3D printing has the scope to bring instant snacks into the living room, like the Nespresso machine did for café-quality coffee in the home,” he says. “Consider a large Pez dispenser that can produce a range of goodies on demand.”
The opportunities seem even more promising in toy manufacturing. One of the major players is exploring how it can use 3D print to create its character toys. Lego has been awarded a patent for the 3D printing of plastic on its block bases and Mads Nipper, the company’s chief marketing officer, has even said it might enable users to print their own plastic bricks. Toy manufacturer Hasbro is also working with 3D Systems to develop “creative play experiences powered by 3D printing”.
Some fashion houses have been early adopters of 3D technology, with designers creating printed items from lingerie to footwear. Most of this has been done to showcase what can be achieved by haute-couture designers (as opposed to mass-produced commercial products), but Brooklyn-based designer Francis Bitonti recently unveiled a dress that can be customized for the wearer and 3D-printed at home.
Earlier this year Finnish designer Janne Kyttanen showcased a project called Lost Luggage, which enabled travelers to email 3D printable files of necessities or accessories – a handbag, a dress, driving gloves, sunglasses – that could be printed out at their destination.
"The key question companies need to address,” says Barnes, “is what is the 3D printed product and why is it necessary or better for it to be manufactured in this way?” The technology is ideal for creating bespoke or intricate objects, but, for example, it is usually going to be easier and cheaper for someone who’s lost their luggage to find a clothing retailer than a 3D printer that can print clothes.
Retailers and brands must weigh the risk of counterfeiting and copyright abuse. Selling 3D printable files for confectionery, toys or items of clothing for printing at home may open up lucrative new revenue streams, but how do companies ensure that consumers only print a product once? They will also be keen to avoid the kind of piracy that afflicted the music industry and prevent consumers from sharing designs with family and friends. Given the advances in 3D scanning, how can firms stop people creating exact replicas of their brands on 3D printers at home?
If products and parts can be delivered or sold outside current channels, suppliers and retailers need to consider the unpredictable impact on their distribution strategy. “Ultimately the issues around profit protection will accelerate or restrict the speed of adoption,” says Dimos. “Retailers need to consider how to sell the idea of 3D printing to their consumers in such a way that it will not cannibalize their existing business model.”
There are many significant hurdles still to be overcome, but 3D print experts such as Terry Wohlers, of research firm Wohlers Associates, believe that retailers and brands will find a way around them to create a global market worth around US$10.8bn by 2021.
“Consumer 3D printing is still a nascent technology,” says Dimos, “but we see no reason why 3D printing could not become a mass market product in 5-10 years’ time. As technology progresses, 3D printing will offer more features at a lower price. It will reach a point where everyone thinks they can have one at home, just like 2D printers.”
Barnes agrees, noting that when additive technologies – of which 3D printing is one – were lauded as game changers ten years ago, many experts derided such bullish predictions. “Yet today these technologies are mainstream and make all sorts of components from automotive parts to medical devices. Although it will take a while to catch on in retail, where margins are slimmer and the consumer is king, it will happen.”
“It took 20 years to go from Sony Walkman to Apple iPhone,” adds Dimos. “People will utilize this new capability in ways that are difficult for us to imagine now.”