As imaging retailers look for additional revenue streams, Picture Business & Mobile Lifestyle, hopes to identify new and growing opportunities within the mobile/wireless industry.
There’s lots of synergy between imaging and mobile, particularly since the imaging retailer understands complex products and today’s new customer service demands. Imaging retailers also have experience in selling add-ons to a basic camera sale. While selling imaging products is just part of doing business—staying in business in today’s volatile environment means looking for complementary product categories that will deliver new revenue streams. They’re out there.
Mobile Mania
Over the past year, the conversations in the mobile industry have shifted from geek-speak about chipsets, technology and carrier infrastructure, to discussions about using the handset for image capture and sharing, streaming video and lots of other imaging-related applications.
Today, the vast majority of mobile phones have a camera in the two to five megapixel range—but recently Sony Ericsson released the 905a mobile phone and it features an eight megapixel camera bearing Sony’s Cyber-shot moniker.
This is clearly a sign of convergence, but some are wondering if it’s also an early sign of the impending obsolescence of the standalone digital camera. For the time being, even a high-resolution mobile phone will not displace the digital camera, according to recent data from Compete, a market research firm. It found that 79 percent of smartphone owners surveyed during Q1 2009 stated that they owned and regularly used a conventional digital camera despite having a built-in camera in their phone.
Mobile phone capabilities are converging with a range of other handheld products in the digital space, including video cameras.
The iFuture
So, what’s all this mean for the imaging retailer? It’s about new opportunities and staying ahead of the curve. Initially, the iPhone was the catalyst for change because it led other handset makers to rethink their design, features, offerings and end-to-end solutions. Along the way, these other handset makers learned that ‘keep it simple’ truly matters—and so does style, fashion and the ‘cool’ factor. In some ways, this is similar to the evolution in the digital imaging point-and-shoot category.
The iPhone got people to take lots of photos, since consumers didn’t need to be rocket scientists to take a picture and easily share it, upload it or sync it with their computer and, more recently, even touch it up. The shift in the capabilities of the phone together with the rise of social media sites like YouTube and Facebook has contributed to an increase in handset popularity, applications and the emergence of new opportunities for retailers.
Recently, Lucidiom introduced its "Pocket Pics" iPhone app that allows users to sync online photos with their iPhone, available free on Apple’s iTunes Store to all Photo Finale Web account holders. With Pocket Pics, when a Photo Finale account holder adds pictures to her online collection, the iPhone will automatically display the new pictures in Pocket Pics. Photo Finale is Lucidiom’s award-winning, white-label, photo-sharing and ordering site that retailers can customize as their own.
Lots of Choices
The mobile universe centers around the cell phone and, more recently, the increasing popularity of the smartphone. While many of the phones from LG or Samsung are tied to carriers, you may want to consider if your store is suitable to become an official carrier vendor for AT&T, Sprint, T-Mobile or Verizon. These carriers are looking for expanded reach and their search has recently landed Verizon kiosks in BJ’s, Staples and Best Buy’s recent experimentation with standalone mobile stores in malls.
An emerging ‘sub-category’ within the handset market that may be of interest to imaging dealers, is ‘unlocked phones.’ These phones are not subsidized by the carrier, carry a substantially higher price tag, and offer more points and add-on sales for the dealer.
Unlocked phones are designed to use a Subscriber Identification Module—or SIM card—that stores subscriber data. Unlike a locked phone that only recognizes a SIM card from a particular carrier, an unlocked phone will recognize a SIM card from any GSM carrier, like AT&T or T-Mobile. The format that competes with GSM is CDMA—and those CDMA phones offered by Sprint and Verizon are not yet SIM-card enabled. All of this applies to the U.S., since most of the world uses the GSM standard.
Typical suppliers of these higher-end phones are Nokia and Sony Ericsson.
Another opportunity for retailers within this handset category is to sell prepaid phones from companies like Boost and Virgin Mobile. These handsets are gaining traction, since people are not tied to calling plans or two-year commitments to the carrier. They buy the phone from you and pay as they go.
We are also beginning to see phones aimed at specific demographics from companies like Kajeet that targets younger children or Jitterbug that is aimed at seniors.
Accessory Sales Abound!
There’s opportunity after the consumer buys the cameraphone, even if they didn’t buy it from you. According to a recent study from ABI Research, two-thirds, or 66 percent, of all mobile phone accessory revenues come from aftermarket sales. This percentage is only expected to grow with time, following a market trend to move more accessories "out of the box" and onto retailers’ shelves.
"Mobile operators and mobile phone vendors see that the only return from including a subsidized accessory in the handset box is customer satisfaction," comments ABI industry analyst Michael Morgan. "While that isn’t without some intangible value, on the retail shelf, an accessory is a high-margin product that will generate actual income. Consequently, aftermarket accessories will also show faster growth rates than those included ‘in-box.’"
Among the most popular aftermarket accessories are memory cards and protective silicone carrying-cases or sleeves. These accessories are enjoying booming popularity in the smartphone world as their multimedia capabilities often demand extra memory capacity, and their high value encourages owners to take better care of them. This latter trend has clearly been initiated and driven by Apple’s iPhone.
The Evolving Ecosystem
Can a handset become a consumer’s primary picture-taking device? Since that potential certainly exists, retailers need to build bridges within their existing operation that speak to this constantly connected and forever-mobile consumer.
The mobile handset is the one device that is with your customer 24/7—and they are using it to express themselves in a variety of ways. It’s also important to note the market is no longer the sole domain of 18-to-35-year-olds as both seniors and younger children, as I mentioned earlier, are now a big part of the mobile mix. There are new opportunities in this era of personalization and mobile penetration – even among teenagers and young children. Just take a closer look.
Susan Schreiner (susan@c4trends.com) is Senior Editor/Analyst for Picture Business & Mobile Lifestyle.
