Strategy Session: Nikon—Bringing Value with a Fresh Perspective

Strategy Session: Nikon—Bringing Value with a Fresh Perspective


Toru Iwaoka was recently named president and chief executive officer of Nikon Inc., the U.S. headquarters for Nikon Corporation. A seasoned executive who has managed Nikon offices throughout the world, Iwaoka brings a broad, worldwide perspective to this imaging leader. I sat with him in Nikon’s U.S. headquarters and talked about the challenges facing our industry.

JG: This has been a challenging time in the imaging industry. As the new president and CEO of Nikon Inc., what do you see as the opportunities for Nikon and for the industry?

TI: Nikon will always strive to be the market leader. To this end, we will continue to introduce very strong products that create value for the market. This is very important, because retailers depend on us to lead the market. By being a Nikon dealer, they signal to their customers they are also leaders in their market, so we see it as a mutual benefit. Nikon is as important to the dealers as the dealers are to us, so we strive to be good partners.

Smartphones have become the primary camera choice for many consumers. Can point-and-shoot cameras remain a viable segment given the move to smartphones?

We can certainly coexist, because there are limitations with the smartphone. It has to be thin and small, and it has a limited battery life. Point-and-shoot digital cameras have really suffered, but as they are cameras, we can focus on very unique features like high zoom, battery life and sensors that smartphones just can’t match. For example, there are high-zoom models like our Coolpix P600 series and waterproof cameras like the Nikon Coolpix S32 or AW120; these are good examples of imaging benefits we offer consumers that smartphones cannot deliver. 

We need to inspire people—not to just share images but to tell stories. With real cameras, the images become more authentic. It’s more about telling a story or sharing an experience, not just taking snapshots. People need to appreciate the picture themselves. Through those images, we can develop a relationship between generations, and we can capture the memory of their precious moments more clearly and more beautifully.

What about Wi-Fi? The speed of connectivity seems to be a challenge.

Connectivity for cameras is very important. Camera manufacturers have to make it quicker than smartphones; so we are working on how quickly and easily we can do that. We are working on that for the future so people do not have to think about connectivity at all.

Nikon is clearly the leader in the DSLR market. What do you see as the prospects for growth in this market, both in the high end and in the low end?

We are providing DSLRs with outstanding image quality technology. It is true that the replacement cycle time is becoming longer and longer, which will actually make the industry decline somewhat. However, we will continue to advance with new technologies and stimulate our customers with new value.

Our goal is to stimulate people to take more fun, creative images—images that will help tell the stories of their families. Oftentimes, one picture is more compelling than 30 minutes of video for telling a story. The power of one shot is strong, and we have to talk to our customers and the smartphone customers, and they have to understand the differences in the results they can achieve.

In many ways, the key is getting more people to experience the different perspectives that interchangeable lenses offer to every photographer. Changing lenses changes perspective, and the world changes in front of them. Smartphone photographers are not inspired to that level yet. They simply share; they take thousands of pictures, but they don’t focus on just one picture. Many smartphone users have never looked through a fisheye lens or a bright portrait lens. All they’ve seen are the images on their screens. We try to invite them to be inspired through a new perspective they may never have experienced.

How can you get entry-level users to move up to a DSLR?

We are offering them our two-lens kit as a starter kit. To some extent, that is enough for them. We try to encourage them to try different focal lengths to make it different. We want people to appreciate our Nikkor lenses and then provide them with the best suitable cameras, lenses and accessories that we can offer for entry-level to professional customers.

More and more, younger people are taking pictures on their smartphones. How do we move them up?

We can inspire young people who are using smartphones to understand that the world is bigger. Most of them are looking at pictures just on their smartphones; the world changes when you can enlarge those pictures to much larger image-like posters—just like the movies.  When they watch a movie on their smartphones or iPad, and then they see a movie in the theater, it’s a totally different experience. We have to change the imaging experience for them in the same way.

The mirrorless camera market has been slower to grow in the United States versus other regions. Why do you think that is so? Will we see more efforts from Nikon on the mirrorless front? Will Nikon be more involved in this market?

Actually, it’s probably slower because of the general positioning of the mirrorless camera as an alternative to the DSLR. Nikon is different. When we launched the Nikon 1 system, our objective was to create a new market for a smaller camera, including a system, where picture quality and video is good, lenses are small and versatile, and features allow them to take different kinds of pictures. All these features on balance are the real value of Nikon 1.

For example, the Nikon 1 AW1 is the world’s first interchangeable-lens waterproof digital camera, and the Nikon 1 V3 has a shooting speed of 60 frames per second. Size is important, but the total value is more than one or two features. We try to make all of these balanced. We are always trying to introduce new value to consumers that fits into their lifestyle. We will keep trying to bring new value in the mirrorless area, so it’s not just a smaller camera but instead it creates a new opportunity and value in photography.

When I saw the new “IAM Generation Nikon” campaign, it felt as though it’s not just about photography. It’s all about an attitude and telling your own personal story through imaging. Is it important for Nikon to become a “younger” brand?

We see the market for storytelling through three generations: today’s kids, parents and grandparents. Each has really important memories, and cherishing their family memories is very important. So they try to convey what is important for each generation, and we see this happening through imagery. We want to talk to all generations about the value of imaging and telling their stories, and conveying those images to their families and friends. People are also sharing these memories socially, along with their passions and life events. We want to help them understand that a Nikon camera can help their images stand out and be noticed.

Photo specialty retailers have been the backbone of Nikon for a long time. What do you see as their strengths and their weakness?

They are very important to us. Retailers can consult with their customers as it relates to their photo lifestyle. They can help people create better photographs and understand their needs. They understand that the needs of landscape, portrait and action photographers may be very different from each other, and their power to recommend on a one-to-one basis comes from the trust they’ve formed with their customers. It’s a very powerful relationship, because through this trust they can keep a customer for life.

What does Nikon expect to accomplish at the International CES?

Every time I attend a new show like this, I always have a concept. I want customers to experience Nikon. I want the customers to experience us in the optical world, and how Nikon can provide new value to them and what we can bring into their future with new and emerging technologies. And also what we can bring to them for their photo life.

For example, last year we set up a three-dimensional imaging experience. People in the booth could take high-definition 3D images of themselves. We try to demonstrate technology and bring some new horizons to show and inspire them for a new value in the future.

People are not interested in just technology. They’re interested in what technology can provide them as a value; that is most important. What is the value for their lifestyle now and in the future? If they can grasp this during their visit, then it will be a successful show for us.

We are in the center of the imaging world as our brand statement says, “At the Heart of the Image.” Nikon is an imaging technology leader, and demonstrating our value will make this a successful show.

You’ve been responsible for Nikon offices around the world. How is the market in Japan, Europe and China different than what’s happening in the United States? What can we learn here?

Markets change from time to time; most are often affected by the economic environment. The U.S. market is recovering now, so we’re in good shape. Europe and China are now struggling, but there are great opportunities in both of those areas. And Japan is always strong to demonstrate new innovations. People in Japan always want smaller, lighter weight, convenient, so technologies like mirrorless have been naturally accepted.

Nikon is a global company, so we are always looking at how products will fare in different environments. The U.S. is a very important market right now, due to its size and economic strength. But we will always be mindful of the different cultures that exist around the world, and how we fit into those cultures.

What do you see as Nikon’s greatest challenge over the next few years?

I think the key is understanding that people seek something new that excites them for their life stage and lifestyle. People are motivated for fun. We have to stimulate our customers’ creative motivations, so our challenge is to provide the best suitable gear for different kinds of people in different life stages, and bring new value to them. If we can introduce the gear that suits their individual lifestyle, then they will be loyal to Nikon.

So what keeps you up at night?

Not only at night but on the weekends: just trying to watch the very unique photo life of U.S. citizens and trying to see what the key values are in this country, so that I can suggest new ideas to Nikon Corporation. I will try to match our products to those values in the U.S. I’d like to try to break the mold and find the next important product for our company.

Photography should be fun, and the biggest advantage of DSLRs is changing the lens. When people see different perspectives with different lenses, they become really inspired. Most people are not experiencing those perspectives. If we can change people’s view of photography by introducing them to new perspectives, we will continue to grow our business.