Magazine Article


State of the Industry 2006 I

However, the educated consumer is likely to spend more to get what they want. In fact, many savvy consumers are stepping up to DSLRs, because of the wide range of control and flexibility they offer. While total digital camera growth is slowing, DSLR sales are climbing to new heights. In fact, we expect total DSLR unit sales of about 1.6 million for 2006, which is up 45% from 1.1 million in 2005. Previously the domain of professionals, DSLR pricing has dropped into the “affordable” range for many amateur photographers. The current resurgence in DSLRs to enthusiasts means more incremental sales opportunities for the retailer—lenses, camera bags, flashes, and other profitable accessories that keep customers coming back.

Our industry is about capturing and preserving memories. What better way to share memories than to print them out. In just a few short years, we have watched the number of digital photographs printed grow exponentially—from 7.8 billion prints in 2004 to an expected 14.7 billion in 2006.

Photo printing still provides a huge market growth opportunity. With a joint effort between retailers and manufacturers to educate consumers on the wide range of available printing options (home photo printing, in-store, kiosks, online) we can continue to shift their behavior and keep them coming back to the retailer, whether it’s for printed photos or consumables. Home photo printing is now faster, easier and less expensive for consumers and consumable sales provide a healthy after-market revenue stream to the retailer and manufacturer alike.

Today, affordable HD camcorders—like Canon’s new HV10 model—provide retailers with another growth opportunity. The proliferations of HD television sets are creating demand for consumers to capture home movies on HD.

As we continue to collaborate with retailers/dealers to take advantage of these opportunities, we are excited about what the rest of 2006 will bring for digital imaging. Our recently announced second half line of cameras, camcorders, projectors, and printers are already making an impact in the market, and we expect that momentum to continue into 2007.

Engage Your Customers
John Homlish, executive vice president Sales & Marketing

To compete in today’s unpredictable photo market, you must concentrate on making your business and the services stand out from the rest. Your store’s appearance speaks volumes for your products and their quality. It’s important to make customers feel welcome by providing an inviting atmosphere that encourages the customer to linger and have a second look around the store. Your store should convey the message, “Come on in and see what we have to offer!” in an engaging way. It is vital to reach out to the female consumer as they are making many of the buying decisions in the household. Make your store more female-friendly by cleaning up any clutter lying around and make sure that all of your personnel look presentable.

As the photo industry continues to grow, we will be seeing more products that offer easier connectivity solutions between devices, using either Wi-Fi or Bluetooth technology. The trend to make products that are cost-efficient and cutting-edge will continue.

Historically, the American consumer becomes more cautious with their spending on “non-essential” items whenever there is uncertainty about their family’s personal economic health. If economic and/or geo-political instability affects their pocketbook or wallet, such as the war in Iraq or higher gasoline prices, then we most likely will see a slowdown in the purchases of consumer electronics products as a whole.

To prosper in today’s marketplace, it is important to promote not only picture taking, but also the sharing of photos with family and friends. While Casio is currently focusing on “picture taking,” with the recent partnership with the National Parks Foundation on their annual photo contest, the positive impact that photography offers can only be felt when images are displayed. The album and frame industry needs to promote the display of photos, possibly through cross promotions with camera manufacturers and/or digital print station manufacturers.

Digital Portal Inc.
Progressive Retailers Will Succeed in the Future
Kevin R. Donohue, CEO

Our industry continues in a state of change, and fortunately the latest and current direction is leading our customers back to the photo retailer.

This trend is quite clear, and major retailers, chain drug, mass merchant, and food retailers are all making the necessary commitment and investment to sustain and grow their imaging businesses. The progressive independent photo retailer has also understood the need for change and has renewed his commitment. We estimate that next year 45% of all prints will be made at retail, and this figure will continue to grow.

The greatest change coming from the digital era is at the retail point of sale. The end-consumer has gone from a scenario of “two each please, drop off and return tomorrow,” to sitting down in a welcoming environment, using a customer terminal, reviewing, selecting, and printing the images they want.

Improving your point of sale area and offering a multitude of modern products & services is the key to maintaining and growing a successful imaging business. The boutique/ café style POS environment really works. We at Digital Portal see it daily in our dealings with all major market segments. It’s great to see successful retailers again with a progressive attitude to the business. Progressive retailers will continue to offer new products & services, meeting customer demand and increasing their revenues.

There were several innovative products launched at photokina, which will help retailers grow their businesses. Digital Portal/KIS-Photo-Me will have a new mini-lab line-up offering retailers 12-inch enlargement capabilities at very reasonable prices. Our new PhotoBook Pro program addresses the need for albuming on an in-store basis, providing instant gratification to our customers.