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Retailers Getting Hooked on Photofinishing Fulfillment Online
As the digital revolution moves to make film only a fading memory, retailers are having to rely more heavily on high-margin online services to help bring up their dwindling roll counts


Ken McDonald
"The big trend for 2007 will be a tremendous move toward one-hour processing," says LifePics’ McDonald.
Joe Kowalik
"We are looking at new solutions on the back end to make CD/DVD production more efficient and cost-effective for the retailer," says Graphx's Joe Kowalik.
Ben Nelson
"We are looking at well over a billion prints this calendar year alone," says Ben Nelson at Snapfish.

"The Snapfish website consistently delivers a recipe of personalization, controlled community, and value that people are looking for," reports Ben Nelson, general manager, Snapfish by HP. "These latest features help users creatively organize and share their stories with family and friends, while complementing our basic value proposition, including high-quality prints for just 12 cents each—almost 40 percent lower than major competitors—plus free online sharing and storage."

Nelson says that they provide retailers with three types of fulfillment service options. The first option is more of a traditional offering, an in-store management operation. "This allows for both one-hour print-to-store and allows for managing the various pieces of printing equipment within the lab," says Nelson. "It's really a best-in-class type of offering that gives the retailer the ability to manage their equipment and order flows in an effective manner."

The second option is a cobranded print-to-store offering, currently available in six countries. "This solution provides a fully functional, unlimited storage online Web service that allows for one-hour print-to-store directly down to a behind-the-counter processor (silver halide or digital) or printing one hour to an HP kiosk," says Nelson. "It's a cobranded service with Snapfish, and it provides the retailer with a complete turnkey opportunity to get into the online game and increase store traffic. With the package the retailer gets an online website with all the functionality of the Snapfish site. It also helps the retailer pick up traffic from the Snapfish site. It's like getting free traffic. The retailer doesn't have to do any marketing or promotion—just wait for the clicks and orders to come in."

Nelson adds that the third model is on a higher scale. "We offer full private-label Snapfish service," he says. "Full customizability with full Snapfish features. This is for a retailer doing a million prints a year."

Nelson predicts that in 2007 there will be more print-to-store prints than mail order done online. "It's a huge business," he says. "We are looking at well over a billion prints this calendar year alone. Why it is growing this drastically? The experience has been made much easier for the customer."

As far as his goals for 2007, Nelson is looking to expand their retail base. "We had a big 2006, and we are looking to better that in 2007. The most important thing for us is to expand our retail presence and also help make our retailers more successful. We are looking to sign additional partners. As a part of HP, we have a lot invested in making sure that people print their images. We need to get the great printing experience in front of customers and attach it to their favorite retailer."

They are also looking to add more services. "We are looking at more gifting options," he continues. "HP is a pioneer in this area. The Snapfish website has more than 100 photo gifts. We have one of the most sophisticated photo books and calendar applications on the market. In that regard, we are extending services with our kiosks. At PMA, HP is expanding its retail photo printing portfolio to include three new solutions that illustrate how the company is evolving its retail photo strategy to move beyond point products to providing a complete photo center solution. These new scalable and customizable retail photo printing solutions—called the HP Photosmart ps2000 studio, and the HP Photosmart pl1000s and pl1000e microlab systems—will result in new revenue streams for retailers."

Getting Retailers Photogized

Graphx, Inc. is the developer of Photogize (www.photogize.com), a private-label digital photo fulfillment service that delivers a single vendor solution for online, kiosk, and over-the-counter photo print ordering to photo labs and retailers. More than 200 retail companies in the U.S., Canada, some parts of Europe, and Australia use Photogize online services and kiosks to grow their digital fulfillment business.

Their primary consumer online service today is PhotoCentral (www.photocentral.net). Through this service they drive consumers to the nearest Photogize retailer via this portal page, and similar zip-code locator pages that are associated with Google's Picasa and Apple's iPhoto.

"Photogize lets your customers view, edit, share, print, and archive their digital photos," says Joe Kowalik, president and CEO at Graphx. "In 2006 we offered PhotoCentral enhancements that have improved the consumer experience of online sharing. With our first release of PhotoCentral in 2005, we wanted to make sure we delivered solidly on the compulsory VESPA functions found in an online photo service—namely Viewing, Editing, Sharing, Printing, and Albuming. The feedback from retailers and consumers indicates that we've delivered a strong VESPA service for the retailers to promote and support, and for consumers to enjoy. With our new enhanced version, we really wanted to demonstrate that the internet is, without question, the technology platform to deliver photo-sharing services broadly across the consumer market. We see the Internet as the technology that is most dramatically changing our definition of what comprises photo sharing, and we want to be right in front, leading that change."

"One of the things we've seen in the past year is that retailers need to offer both fulfillment online and through in-store kiosks," Kowalik adds. "We have begun to help retailers cross-market the offerings, helping them find the right combination of kiosk and online features that will best maximize the ease and the benefits to the consumer."

One big service area that Kowalik sees as a profit center in 2007 is photo books. "In the second half of 2006, we established a relationship with a gifting company for books and mini-books products called QOOP, a leading Web publisher," he explains. "What we liked about the QOOP solution was the simplicity of the user interface for the consumer.

Within 10 minutes, you can drop photos in from our online photo gallery service and make a photo book. It's a very good experience for the consumer. What I'm hearing from our retailers is that they are very happy with the service so far. The solution is a direct ship to the home, but we have a number of retailers using the service in-store. It's been a traffic-builder so far."

Kowalik reports that they will have some announcements at PMA 2007. "We will be introducing some new CD and DVD services," he says. "CDs with orders are very popular. We are looking at new solutions on the back end to make CD and DVD production more efficient and cost-effective for the retailer."


   







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