BU 602 – Marketing
Muhammad Riaz ul Haq
July 18, 2011
Table of Contents
Introduction: A Not-So Kodak Moment3
PART ONE: The Digital Film Industry4
Origins of the Market4
The Growth of Digital Photography5
PART TWO: Kodak14
Introduction: A Not-So Kodak Moment
The purpose of this report is to perform an extensive analysis of the Eastman Kodak digital photography brand, and ultimately, to provide a sound marketing strategy to their board based on our findings. We do so by examining both a macro view of the digital camera industry as well as analyzing the brand’s history, positioning, success factors, and current challenges. We discovered that Eastman Kodak, while once the unquestionable leader in the film industry, failed to adapt to changing technological market trends and was left behind the digital revolution. Kodak’s unsuccessful response to a major technological discontinuity has resulted in a profound loss of market share and profitability. We have developed a market plan for the dire state Kodak currently finds itself in, one that will attempt to reinvigorate Kodak’s brand as a premium name in digital photography by returning to its traditional values and competencies. While the company currently operates through three distinct segments: Digital & Film Imaging, Health Group, and Graphic Communications, we have narrowed our scope to focus primarily on the digital film segment as we felt that this area has the most potential for improvement in the near future.
PART ONE: The Digital Film Industry
Origins of the Market
The evolution of the digital camera market mirrors the evolution of the technology and innovations surrounding photography itself. Throughout the nineteenth century the motivations behind innovations and discoveries in photography surrounded the speed and affordability of creating an exposure. Some of the earliest photographs took up to eight hours of exposure to complete, and were often contained on flimsy and expensive materials, that did not lend themselves to being easily shared. It is evident that the desire to quickly create and share still images existed more than a century before modern digital cameras were ever created.
Early attempts at digitizing images for storage remained largely in the video imaging segment, and very little focus was put on the technology for still images. The progress that was made was characterized by poor picture quality and very difficult storage procedures. As a result, professional photographers and hobbyists clung to the old processes of developing film well into the 1990’s. In reality it was the increasingly competitive nature of the news media, particularly in the newspaper industry that led to some of the more workable innovations in digital still imaging technology. It was seen as a competitive advantage for a media outlet to take, store, and send images through digital transmission, rather than wait for a slow development process before a picture could even be viewed. It is no coincidence that the first commercially available digital cameras were incredibly expensive and used almost exclusively by photo journalists.
As was the case with the market, for still cameras relying on 35mm film for picture development, it was technological breakthroughs that spurred the growth of the digital camera market. With the development of JPEG file formats in the late 1980’s digital images could be taken and stored on the same device using battery power. Although there are many competitive claims as to who entered the market first, Kodak was...