Magazine Article


Camera Retailer Leverages Digital Minilabs and Kiosk Front-Ends to Grow Revenues, Expand Customer Base
Shutterbug Camera’s Minilab Makeover Plus Plenty of Kiosks

With the latest digital minilabs and user-friendly kiosks, specialty photo retailers have an unmatched opportunity to grow their revenues and broaden their customer base. The reasons are simple: Digital printing is a high-margin service offering, even more profitable than selling cameras. And the new generation of in-store digital photo processing solutions aligns with the wide adoption of digital cameras by consumers, who want new ways to capture, store, interact, print and share their images.

A case in point is Shutterbug Camera Shops, a three-store chain in Northern California. President Mike Paschke has installed digital minilabs at two of his stores and has supplied all three with a complement of kiosks that let customers modify their images and place print orders directly to the minilab. “The kiosk front-ends are an especially powerful draw, and we’re acquiring more to ensure customers don’t have to wait in line for one,” Paschke says. “They’re solid revenue generators -- each kiosk contributes about $2,400 a month, even as we add new ones. It’s a no-brainer to bring in more; we haven’t seen any indication yet that we’ve reached a saturation point.”

The point-of-sale kiosks -- AgfaPhoto Image Boxes linked to the vendor’s d-lab digital minilabs -- accept all leading data carriers, including Secure Digital, XD, SmartMedia Cards, CompactFlash Cards, PC-Cards, CDs or floppy disks, and can easily be operated by the customer without requiring any assistance. Interactive user prompts on the touch screen guide the customer through the individual steps required for entering an order. The kiosk software also enables customers to modify the images -- including rotation, enlargement or reduction, contrast and brightness. The print order is sent straight from the kiosk to the minilab. All the photo center salesperson has to do is ring up the sale.

Transforming the Business

Paschke notes that providing enough kiosks is transforming his business by bringing in more customers and prompting them to order more prints than before. “We’re finding that a lot of people use our stores as a meeting place now. Often family members and friends will gather at a kiosk and discuss pictures they have taken and decide how they want to edit them. The result is that we are now getting many larger print orders -- often 200 or 300 and sometimes up to 500 -- since people have the time to make a leisurely decision and don’t feel rushed.”

Creating a comfortable environment for customers working at the kiosks is extremely important, Paschke says. “People are amazed at how easy the kiosks are to use -- especially after they’ve been struggling with their digital pictures at home -- and they really have fun. The issue then becomes how to make sure they can remain comfortably at a kiosk. To that end, we’re putting some of our kiosks on low tables with chairs, and others on a counter with high stools so customers have the option of sitting or standing.”

Accommodating the kiosks is necessitating some changes in store layout. “We’ve had to eliminate a row of gondola displays with frames, albums and the like, but we believe it’s worth it,” Paschke says. “We’re gaining greater revenue and profitability through the kiosks, and we still do display some merchandise around the kiosks themselves.”

Positioning the kiosks near the front of the store is important, Paschke believes. “Customers coming in see the kiosks first thing -- they really have a presence. And passers-by see our customers engaged working at the kiosks, and they know we’re a serious photography store. The kiosks are one of the best forms of display advertising we could ask for.”

State-of-the-Art in Photo Processing

Shutterbug Camera’s move to digital photo processing began in 2002, when it replaced an analog Noritsu lab and a small Fuji digital print station with an AgfaPhoto d-lab.2 in its flagship store in downtown Santa Rosa . Two years later, the chain’s local mall store got a smaller d-lab.1 machine. Currently, the main store has six user kiosks, the mall store has two, and a kiosk in the nearby Petaluma store has a kiosk networked with the main d-lab. Six more kiosks are on order for placement among the three stores.

Besides interfacing with the kiosks, the minilabs integrate easy-to-use operator workstations, sophisticated image editing and enhancement software, high-resolution scanners and photo-quality printers. They offer a comprehensive range of sophisticated features for modern on-site image processing, starting with the ability to produce prints from conventional photographic films, any standard digital media (CD-ROMs, ZIP disks, floppy disks and all of the usual data storage cards of digital cameras), and even digital online print services. Image output is on high-quality photographic paper up to large-format 12 by 18-inch size, and includes the option of recording the image data on CDs.

The minilabs provide a number of automated image processing capabilities, ensuring image quality and high machine and operator productivity. In the processing of color film, the minilab scans the film at a resolution of six million pixels per color, ensuring high image quality. Input and output of the film are separate, enabling the operator to prepare the next batch of films while the previous batch is still in the system.

During printing -- whether of images originating on film or digital media -- the minilabs’ software automatically corrects each image for color and density, and additionally controls the management of sharpness and contrast; correction of under- and over-exposure; improvement of back-light, artificial light and flash shots; and correction of dust and scratches.

Simple Handling for Operators

The minilabs’ operation is sufficiently simple that a single operator can oversee jobs running at the full rated capacity -- upwards of 1,700 prints per hour in 4 by 6-inch format -- producing an average rate of saleable first copies above 95 percent. Operator functions were designed according to ergonomic principles. The operator works via a touchscreen, and the clearly-structured menu can be quickly and easily learned. Standard jobs can be carried out at the touch of a button, while in the case of re-orders, the user interface guides the operator.

New-generation digital photo processing minilabs and kiosk front-ends are allowing photo retailers to flourish as the market shifts to digital photography, which is responsible for an estimated two billion customer visits to retail stores per year. With digital photo processing operations such as Shutterbug Camera’s, photo retailers can generate a strong revenue stream, keep overhead low and margins healthy, and significantly grow their market share.