2008 – The Road Ahead

2008 – The Road Ahead

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Coming out of a strong year with sales growth on several fonts, imaging specialists can look forward to 2008 with measured optimism, tempered by the changing realities of their market and evolving needs of customers they serve.

One need only gaze around the halls of a gathering like CES or PMA to recognize how far imaging has evolved from its film roots and how much further there is to go. Today’s market is as much about electronics as imaging, presenting the specialty dealer with both challenges and opportunities as the imaging specialist.

At some point, demand for digital cameras will begin to taper off, or shift to other product types. We’re coming off another year in which camera sales surpassed expectations. Looking back, NPD Group estimates more than half of buyers through the first half of last year already owned a digital camera. Many households now own more than one. Through last September, PMA estimates nine out of 10 cameras sold were six megapixels, or better, with more than half sold delivering at least 7MP resolution.

Given those numbers, it would seem that most recent buyers have a camera that’s “good enough” for their purposes. As prices continue to fall, will there be features to entice these consumers back into the point-and-shoot market? Or will growth be driven by equipping every family member, young and old, with an affordable digital camera?

A better option would be to convince those who are serious about their photographic pursuits to move to higher end cameras, and especially the DSLR. The potential, there, for add-on sales and the profits they bring, have not yet been fully realized. NPD’s retail tracking through September found more than half of DSLR buyers and 69 percent of point-and-shoot buyers left stores without any additional accessories.

Today’s imaging solutions provider has been pushed into a role as an imaging systems integrator. The camera was once an end in itself. Today it’s the front end of the workflow which also entails a range of options: in-store products and services as well as a home photo printer, computer with software and Web connection, and new means for sharing and displaying images.

The Phone as Camera

Nowhere is that more apparent, than in the camera phone. In its 2007 camera phone end-user survey InfoTrends estimated 15 percent of consumers consider the camera phone their primary picture taking solution. PMA’s 2007 Digital Imaging Survey, put camera phones in 37 percent of all households by the end of 2006. The numbers will only climb.

So far, camera phones haven’t undermined demand for dedicated cameras because of their poor resolution, optics, and limited features. People carry their cell phones with them everywhere; the fact that it’s also a “good enough “ camera for video and stills in many situations is just an added bonus. Eventually we will see camera phones which deliver more of what consumers want in a camera/camcorder. There’s guaranteed appeal for the one device that handles all mobile needs, and people aren’t about to leave their cell phones behind.

The problem for imaging retailers is the camera phone, an imaging device, has primarily been sold through other channels, with a service package. Verizon’s November announcement that it would unbundle the hardware and service later this year, and support any handset, could mark the opening which will allow other types of retailers to establish a presence. This could be a good year to get to know some camera phone vendors and their products.

That would be a strategic move, long-term, in step with the changing demographics of the marketplace. Camera phones are most popular with those under 25, tomorrow’s mainstream consumers. They’ve grown up in a digital world; for them imaging is not so much about saving memories as visual communication. It’s a fundamental shift in attitudes about the captured image. They take pictures so the world can see who they are, what they’re doin and, can move right past printing to accomplish that. At the same time, there’s older groups who have bought into digital imaging. Some need some help negotiating the landscape, others are more knowledgeable. They have traditional needs for expert advice and training on everything from printing at a kiosk to uploading a photo order to what else they can buy to take better pictures. All groups need someone who can facilitate creating their definition of an imaging workflow.

Archival Solutions

One area where every consumer needs that help is in protecting their pictures. Despite its success in selling digital cameras, this industry has not yet done as good a job promoting archiving solutions. There’s too many people, from snap-shooters to serious amateurs, who still entrust their photos to their hard drives. Many don’t even make back-up copies. PMA reports 36 percent of households are not yet backing up their photos once transferred to the computer.

A generation’s memories are at risk: Next time a distraught customer complains how their computer crashed, erasing their precious photos, call the press. Alert people to the risk, and promote the full range of storage solutions: flash media, hard drives, DVD burning, and a host of print solutions, in store and at home. The best archiving solution is still the photo print. It’s the only solution which has real permanence. Formats and media come and go: today’s DVD is tomorrow’s floppy.

Display or Print?

Printing’s appeal seems secure as an archiving solution, and for the range of creative products which digital imaging makes it so easy to create: albums, flip-books, calendars and assortment of photo novelties.

Consumers are also discovering other, convenient alternatives to the print for displaying and sharing their pictures. Digital photo frames and digital photo wallets promise to reduce demand for some traditional print services. The whole notion of the home digital hub, linked to the new generation of thin, high definition screens, throughout the house, brings new applications for the captured image. These developments, and opportunities they represent, invite a much broader definition of what it means to be the imaging specialist.

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