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State of the Industry 2006 I



Leica has seen this consumer trend develop similarly in the photography market. As the demand for digital photography increases, Leica has anticipated consumer needs with the introduction of its much-anticipated Digital M (the M8) and its newest line of compact digital cameras.

The Leica M8 is an updated digital version of Leica’s well-known M-Series cameras. In 1954, Leica introduced its first camera to the M-Series: the M3. Every few years, Leica revisits the M series, making improvements as new technology improves photography. Now in the 21st century, Leica has not only improved the style and quality of the M series, but also updated a classic to compete in the digital world. Later this year, Leica will also introduce three new digital cameras into their collection that are expected in the fall of ’06.

Lexar
MAP Increases Reseller Profitability
Bob Roney, Vice President, North American Retail Sales

To compete in today’s photo market, independent photo dealers should carry an assortment of flash memory cards and accessories supported by a MAP (minimum advertised price) program. MAP contributes to a reseller’s profitability by creating a level playing field and ensures that in-store sales associate time spent reviewing product details with a customer is an investment toward selling goods at that location, rather than an educational exercise resulting in the customer purchasing the same product at a lower-priced online reseller. MAP keeps reseller margins intact and shifts marketing responsibility to store-level activities.

At Lexar we encourage retailers to develop long-term partnerships with us. Our dedicated photo sales and marketing teams both have extensive experience in photography at the prosumer and hobbyist levels. That experience translates into a team of professionals that will help photo retailers manage the madness that is inherent in our category. Ultimately this knowledge will help the retailer make better more informed fact based decisions. In addition, since the June 2006 acquisition by Micron, Lexar is now a vertically integrated company capable of providing photo retailers with products that are cost competitive without sacrificing performance.

Lucidiom Inc.
Beyond the 4x6
Stephen Giordano Sr., Chairman and CEO

In these volatile times, people want to hold onto their loved ones as much as possible. Our industry is key in that we help people find ways to preserve the memories of their loved ones forever. As we continue to grow digitally as an industry, we must go beyond 4x6 and give consumers multiple options for personalizing their memories. The days of just printing out a roll of 4x6 photos are gone. Moms, dads, teenagers, and grandparents—everyone—want to take their images and make them unique. That’s where retailers can help—by guiding consumers to various photo options—wall art, scrapbook pages, collages, photo DVDs, bordered prints, cards, books, etc. What’s more valuable to our customers? A stack of 4x6 prints in a shoe box? Or a crafted album with journaling to tell the story of that family’s last reunion? Or a poster with the top photos from the family’s best summer vacation ever? You name it, and this industry can do it. And, all of these photo options are high-margin products for retailers so that they can maximize their profits—even in the digital age.

Nikon Inc.
Remain on the Cutting Edge
David Lee, Senior Vice President

2006 is an exciting year for retailers. Digital photography continues to drive store traffic and create huge opportunities in both the mass market and specialty channel. Nikon sees the opportunity for the market to continue to grow and is currently on track with its projections for the sales of compact digital cameras and maintains a very positive outlook for the second half of 2006, especially within the digital SLR market.

The continual growth of digital SLRs has affected the photo business positively, and made it more vibrant and aggressive. In Nikon’s opinion, lower prices and a move toward smaller, lighter and easier-to-use cameras will bring wider acceptance to digital SLR cameras, attracting new customers into stores and offering retailers new sales opportunities with lenses and system accessories. With constant innovation and shorter product cycles, it will be important for successful retailers to closely and effectively manage their sales cycles and ensure they remain at the cutting edge with their product offerings.

In the compact line, innovative features such as vibration reduction and ISO sensitivity are important and will deliver better pictures and continue to drive customer interest at retail. Advanced features such as Wi-Fi also continue to gain momentum, although it is still too early to draw conclusions on their level of appeal to consumers.

Through the remainder of 2006 and into 2007, Nikon will continue to build upon its successes in the digital market with new technologies, great designs and aggressive pricing in both the SLR and compact camera categories.

Noritsu America Corporation
Focus On Your Strengths
Shiro Kazuta, President

Photo dealers today should continue to focus on their fundamental strengths. The volatility of today’s market does present challenges to photofinishers, but small to mid-size photo specialty labs have an inherent agility that allows them to adapt to trends and capitalize on new opportunities much faster than other types of photo retailers. For example, we are seeing many of our customers venturing into the world of scrapbooking and reaching out to new customers. This type of boldness is a competitive advantage. In this new market there is a real need for education and personalized interaction, the strong suit of photofinishers. Photofinishers can become an invaluable resource for these consumers by leveraging their imaging knowledge and excellent customer service.

Noritsu will continue to provide a range of output options for our customers. I believe that in the industry there will be a continued focus on more compact, more efficient printing systems. Dry systems, particularly inkjet, are going strong, and will continue to be a factor in the retail and professional photofinishing industry.

Imaging retailers must maximize their relationship with their vendor partners. Take advantage of all the manufacturer resources available to them. For example, Noritsu has recently begun posting even more business building resources on our website for our valued photo specialty customers. There is a customer-exclusive area that provides customizable digital point-of-purchase materials such as order stuffers, counter cards and posters to help photofinishers merchandise their stores. Other sections provide free photo crafts and marketing tips. We are taking steps to add value and establish long term connections with our customers to help them succeed in today’s photofinishing market.

Olympus Imaging America
Focus on Educating and Guiding Your Customers
John Knaur, senior product manager, Digital SLR

Photo dealers should continue to focus on providing education and guidance to DSLR buyers. More first-time buyers are moving to the DSLR space. First-time buyers, along with repeat purchasers, will be looking to specialty dealers for advice on new technology. Specialty dealers are known for being experts and it’s an area where major retailers cannot compete.

Minilab owners need to capture printing business through promotions, education and ease-of-service for both point-and-shoot and DSLR owners. Digital has changed users’ behavior, and printing is not the focus anymore. Minilabs must use new means, including education and ease-of-service, to capture a large audience.


   







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