Fujifilm is offering retailers the opportunity to increase their print product portfolio practically overnight, by centralizing their gift/printing assortment and integrating it into systems that already exist in many retail locations. I spoke with Bing Liem, vice president, Sales and Marketing, Fujifilm North America Corporation, Imaging Division, to help shed some light on this groundbreaking venture.
JG: So tell me how Fujifilm’s new program will help grow profits in the photo industry.
Bing Liem: Fujifilm has been providing centralized printing services for many years to our retail partners. We’ve seen that with the potential personalized photo products have in the market, it’s sometimes difficult for retailers to integrate with many different fulfillment companies. Our Printing Services Group catalog has more than 200 distinct products that will now become available to our retail partners. So, the value of the Printing Services Group is that as a retailer, you can have all of these products with just one integration point. Retailers can integrate their front end to our API, and in turn have access to the full assortment of personalized photo gifts, regardless if it is being produced within our facilities or one of our strategic outsource partners.
It sounds like the retailer can offer a lot wider product array than ever before?
Exactly, and they only need a single integration point. There’s a lot of work involved for a retailer to set up individual integration points, but with our system we’ve taken the hassle out of it.
Can a retailer have a unique product assortment?
We have the ability to offer some exclusives or possibly a derivative (size, style) of a product to a specific retailer. We provide access to the entire portfolio, and they can pick and choose, so everyone’s product assortment can differ.
Does it work with websites as well?
A brick-and-mortar or online retailer can connect their website or kiosk through our API to Fujifilm. The orders are routed seamlessly through our order management system and can either ship to the individual store location or directly to the consumer.
As a back-end fulfiller, you have a good sense of what is being ordered, and where the growth areas are. What do you see as the growth areas in consumer/retail printing?
On the gifting side, the most popular items are still the traditional personalized photo products, such as mugs and mouse pads, as well as greeting cards, calendars and photo books, which are steadily gaining momentum.
Why have photo books been so slow to catch on?
The average person is really daunted by this kind of project; when they look at the process of building a photo book, they think that once it’s memorialized in a book, it has to be perfect. As most family photographers are not designers, the task of building a photo book can be intimidating. Many also try to build a book in one sitting or over a few days, and it’s overwhelming.
You’re right; people are looking for perfection. If you haven’t been doing it all long, it’s daunting just to look at all of the images you’ve collected. So, how do retailers help people over that?
There’s a lot of evolving technology to try to help do that. There are auto-fill type programs that many website providers have that use metadata as well as face detection to organize and layout the book.
However, auto-population is becoming far more sophisticated. Within Fujifilm we’ve continued to develop our patented Image Intelligence to include scene recognition, and the ability to score images to “judge” pictures that were taken at the same place. It uses selection criteria that determine the best image by gauging sharpness, contrast and even blink and smile detection. Building on that, it selects the best image based on a scoring system, and uses that image. So, when you have intelligent auto-population, you’re getting the consumer closer to the final product they wanted.
This should dramatically improve the photo book satisfaction rate, because it will take a lot of the work out of the consumer’s hands. And we can serve up a photo book that is pretty close to the final product, so the consumer checking the book has just minor adjustments to make.
In terms of profit potential for the retailers, what is the kind of product mix that makes sense, or what else should they be investing in?
While the traditional 4×6 print still provides a steady source of revenue, its importance within the consumer output mix continues to decrease.
There are so many more images being taken; although consumers are being more selective about what is printed and what final form it will take. We’re seeing more 5×7 and 8×10 prints, and gifting is also growing. The good news is the margin is a lot higher on these kinds of products. Having the ability to provide specialty output at retail has proven to be a solid investment, as consumers are looking for the creativity of specialty printing (wide-format posters, cards, books and calendars) and the instant gratification of on-site production.
From an operational perspective, there’s very low capital expense, and these specialty printers can be integrated into an existing print workflow. There also are so many substrates they can print on—pearl papers, canvas, banners, board stock; the number of substrates for wide-format and duplex printers is limitless. And they allow retailers to sell much more profitable products.
What’s the biggest challenge for the larger chains in improving their print business?
Maximizing sales per retail square foot and reallocating labor from production to being more consultative as consumers are looking for guidance when it comes to creative output. Fujifilm continues to make significant strides in simplifying the lab workflow to allow for less technically skilled labor so retailers can shift their focus toward the consumer.
Let’s talk about what all this means for the independent photo retailer.
Many of the independents have developed their own solutions, including a limited assortment of on-site production of personalized photo products. A majority of them have a web presence with a web-hosting partner; it could be Lucidiom, Dakis, LifePics. In some cases, they are using the same software for their kiosks. But right now, the amount of products they can offer is fairly limited.
The way we’re trying to help is to integrate to the back end of the web-hosting partners, for example Dakis and Lucidiom. If a photo retailer is integrated with one of the web-hosting partners we are integrated with, we can enable our Printing Services Group catalog with more 200 personalized photo products. Once our catalog is “turned-on,” they can go from offering a limited assortment to 200 products literally overnight. They just have to set the pricing, and they’re in business. And the products can either be shipped back to the store or directly to the consumer’s home.
If a retailer is not yet involved in this, how do they get involved?
We’re in the process of integrating to most of the web providers out there. We went with Dakis and Lucidiom first because they represent a large share of the independents. All retailers have to do is contact Dakis now or Lucidiom (available in the first quarter 2013 ) and have the Fujifilm Printing Services Group catalog turned on. Then they have to pick the products they want, set the prices, and they’re ready to go.
This will really help fulfill a key industry challenge right now—moving people out of the 4×6 world and into more profitable products.
The independent retailer has a very special place in the retail ecosystem. Because they have dedicated people within their stores whose only business is photo, when customers are looking for advice and help with their creative products, they are perfectly set up to do so. The stronger the skill set of the person behind the counter, the more sales of higher margin products will be made. And with so many options for output, consumers need the level of attention that independent photo retailers can provide.
NPD data is showing that the independents are growing. There’s a huge opportunity here, because their stores are set up to display the endless possibilities that are available—and they have the people to explain them. Now, with our system, they have the advantage of offering a vast product assortment that can really satisfy their customer base. fujifilmusa.com
