2010 Imaging Industry Roundtable

2010 Imaging Industry Roundtable

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There was a time, not so many years ago, during which imaging retailers sold cameras and various photo accessories, offered photography advice, perhaps sold and developed film and enjoyed life in what appeared to be a rather mature industry—one many referred to as a “cash cow.”

Those days seem like they happened a very, very long time ago to many.
Well, that was then and this is a very different and complicated now. That you only have to travel back about 15 years to that aforementioned time makes the developments in the imaging industry since then all the more amazing.

Digital cameras are capable of tricks no one imagined, the Internet is as much of a part of your customers’ lives as breathing, mobile imaging technology has put very compact and easy-to-use still and video cameras into the hands of billions and social networking has opened doors to sharing life’s moments minute-to-minute as opposed to moment-to-moment.

What all the above has done to the imaging industry is explosive, game-changing and, perhaps most important to remember, just beginning to be realized.

Based on all that and a bit more, we came up with eight questions we felt touch upon most of the issues inherent in all the noise and rounded up a panel of experts we think represent the four corners most important to this industry—retailers, manufacturers, distributors and researchers/analysts. We even added another voice—that of your customers as a few of them weighed in on some of the questions as well.

Space constraints prevented us from printing every response but the text that follows represents the responses we feel best addressed each question. Thanks again to all who participated. Enjoy their insights.

Regarding the social media craze and, more specifically, all the stills and videos consumers are uploading and sharing on sites like Facebook, how can imaging/mobile retailers best take advantage of these relatively new consumer imaging behaviors?

Mike Worswick, Wolfe’s Cameras, Camcorders & Computers, Topeka, Kan.: The social websites, especially Facebook, are capturing major blocks of consumer time capacity. Their recent decision to upgrade storage size of images is an opportunity. I am anxious to test the new Lucidiom option to view and print Facebook pages on our kiosks.

Mark Gustavson, Executive Director, Marketing & Communication, WYNIT, Inc.: Demonstrate, demonstrate, demonstrate. Interactive displays inside brick-and-mortar retailers that enable salespeople to show their customers just how these new technologies make it easy to upload and share are crucial. The value-add is the same as it has always been in photo specialty—position yourself as the expert with your customers, and engage their passion to participate, create and share.

Mark Comon, Paul’s Photo, Torrance, Calif.: That’s the million dollar question. We’ve used Facebook as a “social and promotion” venue rather than a sales venue. No one yet has asked us to “print pictures from a Facebook page.” I am sure that’s coming…When will the 15-25 crowd want a print of a picture?

David Guidry, Lakeside Camera Photoworks, Metaitie, La.: My company is concerned with creating unique ways to do something special with images. Not all images carry the same weight. With the proliferation of cheap, high-quality digital capture devices comes a torrent of transient images. Still, life provides important people, occasions and settings for all of us. When theses times are recorded, we want to provide a vehicle to showcase them in creative ways.

Lisa Walker, President, I3A: In this age of social-media-driven consumers, you have to go where the customer is; you can’t expect them to come looking for you. Get out there and be present on Twitter, Facebook and LinkedIn. Use free online tools like Hootsuite or Tweet Deck to track the conversations about your products and services that are going on every day. Listen to your customers and address any negative comments that come up immediately. Be there to guide the conversation and drive word-of-mouth to the positive side.

A hot topic in I3A’s Photo Sharing and Photo Book Interest Groups is that Facebook is now storing uploaded photos in higher resolutions. This is great news for consumers, who may not even have been aware that Facebook was downsizing all of their images to 720 pixels, to the point that printing them was not a viable option.

Now, the higher resolution images, up to 2,048 pixels high or wide, represent a huge opportunity for retailers. Along with the Facebook Connect feature, retailers can now directly access users’ uploaded photos on Facebook and make offers to print or make photo albums.

Joe Byrd, 6Sight Conference: The greatest value that retailers bring to the table is their knowledge of the products they sell. By participating in social media they can meet new customers and help them with questions and problems that they have while at the same time building their reputation for their expertise and the value of being one of their customers.

Manny Almeida, VP & General Manager, Imaging and Electronic Imaging Divisions, Fujifilm North America Corp.: Recognizing the importance of social media, Fujifilm has been active in this area for the past few years, most especially with the Z-series line of Finepix Digital Cameras. We’ve had great success with advertising on Facebook, and even created our own social networking site with contests and events, such as ZSpotNow.com. We make use of our FujifilmUS Twitter feed, and, in fact, are launching Facebook and Twitter contests this year.

We find all these efforts are a great way to reach targeted demographics in a fun and informal manner, resulting in increased awareness and sales, and we expect to continue with these activities.
 
David Lee, Senior VP, Nikon: When you look at the popularity of social media, it is driven by content sharing—still and video are key drivers that make the category relevant for such an extensive audience. Retailers need to make imaging more relevant to this broad audience, and there is a good deal to learn from visiting and participating in online communities to get a true sense of what today’s consumers are looking for and how they like to interact.

Nikon recognized the value of social media very early, and we continue to leverage it as an excellent opportunity to communicate with consumers and understand market needs to help build our brand. We have more than 306,000 Nikon fans on Facebook, more than 54,000 members in our Digital Learning Center on Flickr and more than 11,000 Twitter followers.

We encourage retailers to explore our online communities, among others, to learn about trending topics and how photographers, enthusiasts and general consumers interact and what they find important. This will allow retailers to get a better sense of what influences the purchasing decisions of their customers.

Liz Cutting, Digital Imaging Analyst, NPD: NPD’s September 2010 Digital Imaging Study revealed that 72 percent of adults under the age of 30 who recently purchased a digital camera were uploading their still images to social networks, and 22 percent were uploading video. Compare that to the fact that just 9 percent of these young adults said they were making photo books and you have an “opportunity” to attract the next generation of photographic families.

The biggest reason for not printing at a photo specialty store for this core group was “too expensive,” followed by “inconvenient location.” Having a committed presence on Facebook gets you in the game among many of these younger consumers who otherwise might never graced your doorstep. Retailers who present themselves as responsive, current and full of good service stand to benefit from increased brand awareness and more customers in the store. Social networking is a vehicle with give and take—give consumers excellent advice, good in-store deals, and an environment to share images, and get information on consumer needs and gain endorsers of your brand. “Word of mouth” accounts for over a quarter of the reasons consumers pick a particular retailer for printing their images.

Hilary Araujo, VP Marketing, Tiffen: For retailers, just as with manufacturers, a social network must be one that is structured to support its members and not be a commercial platform. It should be available as a venue to share information, welcome comments and suggestions and be a supporting participant, even developing applications that help the consumer in their decision-making process for new equipment or accessorizing their existing equipment.

Eliott Peck, Senior Vice President, Consumer Imaging Group, Canon: This is an interesting point, because as the technology of imaging evolves, so does the way in which consumers use the technology. Knowing how the customer intends to use the device goes a long way at the point of sale. The popularity of video and the ability to share video easily has revitalized this medium among general consumers.

However, most consumers still want to capture video on a small pocket-sized device, with files that can be easily shared and uploaded to social media sites and the web. At the same time, the use of still images among consumers has never been more prevalent. Still images have become such an ingrained part of our culture, beyond the framed print, that we see the need for constantly updated images for everything, including social media sites, interoffice networking, mobile communication, shopping and note taking. Today, no business report or PowerPoint presentation is complete without accompanying images.

In the still image realm, technology is advancing so rapidly that many consumers may not be fully aware of all the features their current camera offers, much less all the new features currently out on the market. Dealers can help themselves by helping their customers understand all that the technology offers. With video, for instance, both Canon and its retailers can benefit by educating consumers and making them aware of new features. Many of the best still-capture devices, like our PowerShot cameras, offer the video capture and creative options they are looking for, while still remaining pocket-sized and style-conscience for the individual.
It is through sales assistance at the point of purchase that dealers can significantly benefit from knowing what the consumer wants to accomplish and guiding them in the right direction.

Pat Boehm, Consumer, Lancaster, Va.: I’d like to be able to take the albums I create on FB and simply direct a retailer to my page with a link and have them create a photobook from the albums I direct them to. Each album is usually of an event, and there are some that I’d like to have a printed record of too. If this is possible today, no one has made me aware of it.

On the mobile imaging front, with the continued advances in the imaging capabilities of smartphones, what can we look forward to on the point-and-shoot digital camera front in the years ahead?

Worswick: The improved cell phone photo capture will make shared pictures more popular than ever. The big issue will be having these devices easily move photos off the phone for printing and more permanent image retention. I believe the days of the simplest point-and-shoot camera are numbered. It will be critical for camera makers to focus on products that far exceed the performance of a multifunction device like an iPhone.

Comon: Wrong question…When will pocket cameras get phone capabilities? I think that may be right around the corner. We expect to see some upcoming releases and certainly more by before next spring.

Walker: As camera phones encroach on the lower and middle segments of the market, leveraging technology advances, and the work of groups like I3A’s Camera Phone Image Quality Initiative, the DSC market is also evolving to find and maintain its place in the market. While smartphones do more and more, point-and-shoot DSCs will become more focused and customized for certain types of applications. Camera vendors are pushing advanced features such as 3D capture and print, and “travel” cameras that contain a GPS to automatically geo-tag images and capture the tracks of a vacationer’s trek. These travel cameras give consumers an easy and whole new way to capture and relive their holiday memories.

Guidry: I believe the cheap, standalone digital camera will become disposable. The smartphone will develop into the dominant “snapshot” device. We will see some pretty cool high-end point-and-shoot models featuring good optics and larger sensors. The non-SLR cameras like the Olympus PEN will gain some share of the traditional point-and-shoot market.

Cutting: I believe it was Woody Allen who said that “90 percent of success in life is just showing up.” Consumers embrace mobile phones as “good enough” to capture the moment, because they are with us all the time. Point-and-shoot cameras have to earn their place in the microcosm of image-capture devices.

So far they’ve been keeping up appearances, witnessed by the fact that in the over-$200 price point range they were up 2 percent in units and 1 percent in dollars YTD September 2010 versus prior year. Yet the overall compact market was down 4 percent both in units and dollars versus prior year. Doubtlessly, the compact camera industry will lose some low-end consumers to camera phones and we are already seeing some of that cannibalization come to pass.

Lens quality, bigger sensors, long zooms, fast auto focus, continuous shooting mode, and more features packed into smaller bodies have all contributed to enhancing the pure experience of taking a photo with a point-and-shoot camera. With a smartphone, however, we can do so many things on the fly with our pictures—zap to Facebook, or send them to print on a home printer, online, or to pick up at a local retailer. For now we compromise for the sake of convenience, but few camera phones can boast superiority over point-and-shoot cameras.

Bracing for the future, point-and-shoot cameras need to stay a step ahead of mobile phones to retain relevance. Compact cameras must surpass mobile phone capabilities beyond basics like image quality and shutter lag by integrating functions of convenience. Capabilities such as wireless transfer, in-camera editing, facial recognition and GPS must demonstratively save time for, and bring joy to, Mom (the main user) so she can organize, keep and print her memories long after she’s “Facebooked.”

Byrd: The point-and-shoot will need to become connected to the Internet like the camera phones and enable developers to download apps to the camera like the iPod and the Droid. At 6Sight we will present the Frankencamera, which today is tied into a Nokia camera phone to demonstrate this connectivity and what it can bring to the total photography experience.

Almeida: Interestingly, Fujifilm is one of the largest suppliers of camera lenses to the upper range of the mobile phone market, but there are capabilities and applications we need to add to make these phones more camera-like.
Currently digital cameras are at around 16 megapixels. We are getting to a stage where more megapixels have diminished return. However, there are other features that interest consumers: improved image stability, improved zooms, long zoom and wide angle. We’ll probably see GPS and Wi-Fi. It’s about accessibility, ease of use and flexibility all in a small package. 

Araujo: I think a convergence of technologies will definitely occur. I can see a reversal in priorities from a smartphone or iPhone to a device with more features of a digital camera for better quality images that also have a phone and Internet connection. Images and videos are becoming more important, yet people still want to be connected—they want to be able to text, talk, see e-mail and send images.

Peck: While we can’t comment on future products, in the wake of Canon EXPO, I think Canon Inc. has given us a great sneak peek at what we can expect in the years to come, great HD video quality, advanced connectivity and file sharing and a continuation in the advancement of imaging and how people interact with imaging.

Today’s imaging retailer faces several major challenges in what is a rapidly changing market. What are the key areas they need to focus on to grab a larger share of consumer attention?

Gustavson: Managing a vibrant customer community continues to remain the best way to grow share. Successful imaging retailers create exciting opportunities that draw repeat customers to both their online and physical destinations. The key is to build and maintain a comprehensive contact list so new product and technology demonstrations can be announced via social media and hosted in-store or on the web, with special deals for attendees.

Cutting: For the specialty imaging retailer it’s about destination. Big-box electronics stores are ramping up service and support that have always been the raison d’etre of the specialty store. Successful imaging retailers implement passionate creativity by:

• Staffing with consultants who are committed to every consumer gaining a better photographic experience because of the time they spent in the store, regardless of their skill set

• Using large, high-quality displays to showcase the best and the biggest that new technologies afford in still and video 3D and HD.

• Carrying a broad assortment of accessories at various price-points and showcasing them in tiers of solutions for the first-time or the more advanced photographic consumer.

• Flanking camera and accessory displays with frequently refreshed specialty photo merchandise that speaks to the season—i.e., photo books, collages, blankets.

• Having the best of home-printing hardware and consumables available as the advanced consumer enjoys the creativity of the digital darkroom.

Araujo: Retailers need to educate their consumer base about this increasing fluid market. Involving the consumer via their social network or website and alerting them to not only the latest imaging technology, but what they recommend will best compliment it to enhance the overall picture taking experience and why.

Comon: Cameras are best bought from camera stores. There is a difference in service and quality. If you want us to be here for you to answer your questions you have to be here to make your purchase.

Guidry: We focus on services to assist customers in doing great things with their photos. This is an area in which we can develop unique offerings. Exclusivity can lead to increased margins. This is, in part, our strategic response to the low margin, commodity wasteland that is consumer electronics.

Almeida: There are still some huge opportunities in printing. While not necessarily 4×6 prints, those opportunities are in personalized gift items such as banners and posters for parties, mouse pads, calendars, photomugs and, of course, photobooks. But if the retailer does not offer these, then consumers will find them elsewhere. Impulse and spontaneity are key, along with the availability of lots of on-ramps, such as web ordering, mobile device ordering or in-store kiosk. The choice of pick up at store or mail to the home are also important to consumers. Retailers must make the effort and offer these options, or consumers will go elsewhere because today there are lots of choices and methods to producing the product.

Walker: Do more for your customers. Make it easy for them. The rapid growth of digital photography has created many challenges for consumers. While capturing is easier, faster and more fun, that’s where it ends for most consumers. Managing ever-burgeoning digital photo collections is an overwhelming and time-consuming task. Preserving those digital photos is a critical but most often completely forgotten part of the experience. That’s where I3A’s Image Preservation Interest group comes in. This new I3A group is dedicated to giving consumers the information they need to help preserve their digital memories, through resources like our SaveMyMemories.org website, and through standards to help ensure they know what to look for when buying storage media and printing supplies.
Retailers can help by providing services to help manage, store and preserve consumers digital photo collections—do it for them to remove the unpleasant part of the task and leave them with the simple joy of shooting pictures.

Lee: Nikon is very focused on ways to increase the volume and quality of dialogue we have with consumers and partners to keep pace with their needs. We are doing this through strong relationship-building and smart use of social media to provide the customer with a platform for communication.
Dealers need to make sure that they are delivering a great shopping experience even as the marketplace continues to change, and understanding consumer needs and behaviors through social media is an excellent way to learn. Retailers need to be flexible to ensure they are delivering what the consumer is looking for, and the same is true for manufacturers. This is why we value consumer dialogue and the opportunity to educate people – it enables us to adapt to better satisfy the market.

Peck: I believe a challenge for retailers in this changing market is the struggle between remaining a resource for the consumer, while at the same time offering the right price point and technology to get them to walk in the door. Customers seem to know what they want before walking in the door. Fewer and fewer of them are relying on the sales associates for their recommendations, instead utilizing mobile and web-based technologies for recommendations and research. Embracing the new educated consumer could prove to give retailers an edge, and working with manufacturers to provide sound advice to consumers or the ability to answer a question when asked will ultimately make a difference.

Tim Grenke, Consumer, Old Bridge, N.J.: Awareness is the biggest problem I see as a consumer. I’m not aware of all the cool things I can do with my images and I’m not comfortable doing any of that stuff online. I want to really see the products before I make a purchase and that’s not happening. When it comes to my memories, show me something cool and I might buy.

A recent PMA study claimed that only 40 percent of U.S. consumers know what a photo book is. How can the imaging industry best address creating greater awareness and demand for these newer products and services?

Walker: While incidence of photo book creation has not risen dramatically over the past few years as a whole, the potential for photo books remains great. NPD’s September Digital Imaging Study revealed that 18 percent of recent digital camera buyers made scrapbooks on their own while only 6 percent were making photo books. Opportunity knocks to build awareness and trial. Like photo scrapbooks, photo books are items of the heart, because as technology currently stands, they can be truly a labor of love to create.

I3A has already begun addressing this issue by creating a Photo Book Interest Group as part of our recent re-structuring, and a Photo Book Initiative within it.

The Interest Group is a community where like-minded members can collaborate on projects, develop standards and generate solutions for significant imaging issues affecting their businesses.

Promotion will be key, as there is so little understanding among consumers of how easy and economical it is to create Photo Books. I encourage anyone who is interested in these goals and activities to look into joining this work. There is more information at http://www.i3a.org/technologies/photo-books/.

Cutting: The latest NPD study revealed that more than two-thirds of those making photo books using a retail or online service were creating their books online and having them shipped home, knocking the in-store retail experience right out of the picture. When it comes to 4×6 prints, however, just one-in-five who were using online or retail services had no in-store contact. The opportunity is to grow awareness, desire and trial in the retail environment. Manufacturers and retailers should partner to merchandise and staff in-store displays that knock the socks off of consumers with inspiration to create something personal and priceless, an emotional concierge, if you will.

Gustavson: A significant part of the answer is the Managed Customer Community concept. Retailers who maintain customer dossiers as part of a customer relationship management effort are far more effective in creating incremental sales opportunities. While it is incumbent upon the retailer to ensure that their customers know about any new technologies in the offering (reinforcing any messaging that exists in the media), suppliers must provide effective promotional tools to assist in this effort.

Comon: Book, mugs, 4×6 prints…anything printed is good. SOMEONE needs to take the role of the leader in the photo industry. Kodak did it for 50 years and is not the one any longer. SOMEONE needs to remind the public to take and print pictures. I hope PMA will do it.

Guidry: I have no idea about “the industry.” We intend to ask our customers, “Have you seen this?”

Byrd: Exhibit photo books made by their customers in their stores and let the word of mouth spread from customer to customer that way. Encourage local clubs and schools to create photo books with the help of in-store personnel.

Almeida: By making sure that retailers are promoting the books to consumers. Everyone seems to think that the manufacturers should do this, but these efforts need to start at the grass-roots level with mailers, envelope stuffers, web banner ads, e-mails—all leveraging opportunities to reach out to consumers.  That’s why we recently launched a contest for photofinishers where we’ll be providing an award for the best photo book promotion ideas submitted to us.

Lee: In addition to products and accessories, tools for storing and sharing are also important to consumers. Dealers should look to utilize ways to directly communicate with consumers to better understand what solutions consumers want, whether it’s photo books or other innovative ways to share. This direct line of communication is another way to engage consumers to educate, challenge and market to potential customers. A good example of this is the way that Nikon publishes consumer reviews on its website so that consumers can verify a product will fit their needs, and dealers can see what people are saying about their products and services.

Another way we promote sharing and image storage is through Nikon’s Mypicturetown.com which is our online photo sharing and storage site. Recent enhancements to this site include added sharing tools for connecting with online communities and a “PhotoMovie” tool for consumers to create movies using images and text set to royalty-free music made available on the site.

Brennan Mullin, Senior VP, Personal Imaging/Audio Group, Sony: A key area of focus for imaging retailers is to offer the support customers need to fully benefit from the rapid advances in digital imaging products. Digital imaging continues to innovate to meet the ongoing consumer demand for better and better image quality. While new product introductions continuously advance the state of the art, it’s difficult for mainstream consumers to maintain awareness, or realize the full benefit of what they are currently using. Imaging can be enormously rewarding, and helping customers enjoy the benefits is a real opportunity for retailers.

Peck: Products and services still begin with the capture of a great image and the desire for that person to archive and share the image in a tangible and fun medium. As we inspire consumers to capture better and better photos, I believe we open the doorway to new and unique ways for them to share and present their work, whether it is a framed print on a wall, or a nicely bound photo book as a gift. But it all starts with the image, and when those images are so clear and beautiful, the consumer may be inspired to share them.

How important a role will 3D technology play in the consumer imaging world?

Worswick: 3D offers a buzz opportunity at retail. Is it an important part of a picture today? Probably not at all. We will have to be able to view images without glasses in a variety of ways not only on the back of a dedicated camera. Printing options need to improve. If a digital camera file was combined into a holographic style view on screen or on some electronic surface then the desirability would increase.

Cutting: About a third of consumers stated they want to capture images in 3D, according to NPD’s 2010 3D TV Snapshot study. As the entire technology industry supports 3D as the next wave of excitement in visual experience and output, 3D image-capture devices are fresh out of the oven. Time will tell if the excitement turns to mainstream action, but surely there will be enthusiasts, likely male at first, who will run with the technology and watch it fly off their big screens.

Walker: There are a number of promising 3D technologies and applications now being explored both by startups and by major industry players, some of which I saw demonstrated earlier this year at Photokina. Some of these are compelling enough that I think a certain subset of consumers will be very interested in adopting 3D technology in cameras and various other applications, once price barriers and a few technical hurdles have been addressed. There will be ranks of early adopters soon. Acceptance and use by the majority will likely be dependent on economic factors, however.

Guidry: This is a tough one. I assume that one day we’ll all have access to our own Holidecks like in one of those Star Trek series. Its going to get better and gain adoption on the way to Virtual Reality entertainment for humans. However, I’m not buying 10 pairs of expensive 3D glasses and keeping them all charged so I can have my buddies over for the SEC game of the week.

Araujo: There is a huge opportunity to bring consumers into the world of 3D technology. All of the major smartphone manufacturers are experimenting with 3D for their future handsets. And it looks like shooting 3D video and processing is also being addressed (Texas Instruments’ OMAP4 chipset for smartphones was touting the ability of the system-on-a-chip to process multiple cameras’ images for stereoscopic 3D recording of 720p video on your phone). For consumers to truly embrace 3D technology, the necessity (and cost) of using glasses will need to be overcome.

Byrd: 3D will spur the purchase of a whole new set of equipment from cameras to printers and display systems much like the innovation of digital photography did. It will also drive consumers to printing at retail as a high-end solution that they can duplicate at home.

Almeida: At Fujifilm, we’ve been in the market with the first true 3D digital camera for more than a year now. When we first introduced the FinePix REAL 3D W1, with its dual lenses and sensors last year, we took a very strategic and deliberate marketing approach. First we went out to the stereoscopic enthusiasts—the hobbyists, then to a wider audience of gamers and early adopters. 

This year,with the FinePix REAL 3D W3, we are expanding on this foundation, with far more agressive marketing and extensive availablity—especially as more 3D TVs come to market. With the proliferation and popularity of 3D movies like “Avatar” and “Toy Story,” we think there will be a solid future, but like other new technologies, it will take time for mass-market acceptance. Think back to the evolution of items such as VHS converting to DVD and then converting to Blu-ray.

The potential is there, but it will take time. And price and content will certainly be critical to driving the adoption rate.

Lee: There has been a lot of industry buzz about 3D and we are watching consumers and the marketplace to better understand if there is a market opportunity, but for right now it seems that mass consumer adoption is off to a slow start. Historically, there have been many adaptations of 3D cameras over the years that were not commercially viable. While the emphasis on 3D-capable display devices and technologies fuels a new market interest, it is very early and we need to continue to evaluate the market.

Mullin: Sony is one of the first manufacturers to offer a solution for creating personal content in 3D. 3D Sweep Panorama™ technology creates two images from a single frame, enabling panoramic photos to be viewed in 3D on compatible 3D systems and other devices that support 3D technology. 3D technology will play a significant role in the consumer imaging world, especially as installed base of 3D TV grows. The ability to enjoy 3D personal content is not only very entertaining, it’s a natural extension of a consumers’ 3D TV investment.

Peck: Consumers are finding this technology fascinating and exciting all over again, as evident in the box office crowds for 3D hits such as “Avatar” and “Toy Story 3.” 3D television for home use is only now penetrating the market, and it is something to keep an eye on. However, we are not currently seeing heavy demand at the consumer level for 3D technology in terms of image capture. As with any new technology, you will see a broad adoption in the professional space that will work its way down through early-adopters and ultimately to the general consumer imaging public.

We keep hearing consumers say, “Make it easier for me to make all my digital still and video files actionable and more a part of my life.” Is the imaging industry responding to this demand?

Gustavson: This type of convergence is central to many of the new products hitting the market in the coming months. The technology is out there. Now it’s time for retailers to work with their supplier partners to show consumers just how easy it is.
Comon: Who? Camera makers make cameras. Computer makers make computers. Printer makers make printers. Until there is a device to do this, no one wants to address it. Sony and Apple try to push this in their computers but I don’t see that as the right avenue to approach this.

Walker: Preserving and organizing digital images is another area where I3A has been working to assist consumers and the industry. Our Image Preservation Interest Group is focused on overcoming the obstacles—technological and behavioral—to keeping consumers’ memories and other images safe and accessible for generations to come, using education, research, testing and the development of standards. Our consumer-facing educational website SaveMyMemories.org uses a “cookbook” approach to help consumers understand how to protect, organize and preserve their digital files.

I3A’s standards work in this area is being carried out by our IT9 Imaging Technology Committee and internationally in ISO’s TC42/WG5, for which we serve as Secretariat. You can find out more at http://www.i3a.org/technologies/image-preservation/.

Cutting: There are many “solutions,” but few that are unified. Very few manufacturers have that competitive advantage of presence in each area of imaging—capture, sharing, storing and printing—that facilitate stewardship of the consumer image experience through the ecosystem. None is a master of all trades. There is no “one-stop shopping” for the consumer by virtue of competing brands and messages, therefore the onus is on him or her to take action with those images.

The focal point for much of this opportunity is at the retailer, both in-store and online. That first touch point when the new DSLR consumer walks in the door with a desire for a better photographic experience is the critical moment. To meet a sales consultant who asks a few simple questions and intuits needs in a personalized manner can open the door to loyalty. From there one can start the relationship that may lead to a lifelong consumer who scans old photos, comes to you like clockwork for holiday cards and year-end photo books, takes a class and walks away with a lens, a flash and a digital filter, and recommends your store to all her friends. Exuding passion is contagious, and it’s best done face-to-face.

Guidry: I don’t know about this “imaging industry” you keep asking about. I know I can take a reasonably high-quality photo or video with my iPhone and share it with hundreds of people on Facebook immediately while sitting in traffic. That’s pretty well here isn’t it? It will all be woven together eventually by those who control the dominant social ecosystems.

Byrd: Perhaps not quickly enough. We are still thinking of photography as a passive analog activity not as digital electronic engaging activity. We all want to do more with our images and right now most of us has to do that without much advice or direction.

Almeida: Part of the issue is that, in the past, it was easy for consumers because there weren’t many choices. You had 3.5×5 vs. 4×6, and single prints vs. double prints, and matte or glossy, and that was about it. Now, there are so many choices with still images and video files, images being stored on cards or on a home computer, and how do you manage all these files? The industry still has a long way to go to help in this area, but Fujifilm is trying to make it easier with digital camera features such as image tagging and face recognition for creating photo books, for example.

Mullin: With many of Sony’s new technologies and products (Bloggie, NEX Cameras) the company is playing its part to make it easier for consumers to make their digital still and video files actionable and more a part of their lives. More and more powerful indexing and search post-shooting applications, together with the ability to view and share content over home networks is improving access and enjoyment of images and video. Enjoyment of images and videos is a greater part of consumers’ lifestyle and is crucial to the industry.

Lee: Effectively meeting the needs of consumers includes making it easy for them to capture and share content. Outside the camera, Nikon is very active in building and supporting communities and programs that enable consumers to share, store, receive feedback and participate in dialogue with other consumers. This happens in our communities on Facebook and Flickr, along with my Picturetown. Inside the camera, we continue to innovate to make it easier to capture and share images and video. By pioneering technologies like the in-camera projector, or the first DSLR with autofocus while recording movies, Nikon gives consumers the tools to create amazing content to share.

Peck: My initial reaction to this question is, ‘Most certainly’, this has and remains the primary focus for the development of much of Canon’s consumer technology. We want to make our cameras, printers, camcorders and all imaging devices fun and easy to use and enhance the customer experience. Recently introduced features such as our HD Movie Print that allows consumers to grab and print still images from their HD video footage, Smart Auto feature that provides optimal settings and high-sensitivity HS System that improves the low-light image quality of our PowerShot cameras are all designed to make the end-user experience more enjoyable, and thus have them be a seamless part of people’s lives.

Tina Corrado, Consumer, West Islip, N.Y.: I don’t feel they have. I’d love to do more with my the stills and video I am capturing—particularly the video. I have a ton of short clips of my kids and I’d like to be shown a way to make them all more available for me to share and enjoy. Instead, they are sitting on my hard drive.

Regarding the subject of Channel Conflict—it is not uncommon for manufacturers to give priority to selling merchandise on their own sites over retailers who have those products on order. Provide your thoughts on this subject.

Worswick: More suppliers are developing direct-to-consumer websites. This is not absolutely bad. These suppliers need to pick and support their retail partners carefully. For instance a website that is disruptive to the market may be dropped by the supplier once they have their own website working effectively.

I think the more critical issues demand that the manufacturer not undercut its partners. First pricing and shipping terms on the supplier’s site need to leave a margin reward for the retailers who stock and display products in a showroom. More importantly the online factory sites must collect sales tax from every state that has one. One of my suppliers collects taxes only in states where they have physical nexus. Hence they collect no tax in Kansas. That makes me seem 9% higher to my customer compared to factory direct. My partner is punishing my business. The uniform tax collection issue is most important.

Comon: It’s very large in my mind. Do they want to “take over” this business? I still feel a local store can compete through service, product mix and personal attention. I am not worried about “going out of business” because of this. But with regard to the changing face of the competition, who will it be? How do I better them? Where will my “slice of the pie” be?

Cutting: In a consolidating retail marketplace, manufacturers need to find ways to grow product presence; doing so via direct to consumer online sales is a growing trend. Naturally, many consumers are visiting manufacturers’ websites to research products prior to purchase; for the manufacturer to drive some consumers directly to purchase at that point of attraction just makes corporate sense. But whatever is selling on the manufacturer’s site is typically at a higher average price than one might find at retail, and is used to showcase what is available directly from the manufacturer, in its own language and environment. Items like this are used to build awareness of the scope of the brand.

The imaging retailer’s opportunity is to provide a destination for the imaging consumer to get excellent consultative service in a uniquely inspiring touching, learning, kicking-tires environment. You don’t get that experience from a manufacturer’s website.

Walker: Channel is a fine line for manufacturers to walk. They have to constantly evolve to remain competitive, and that includes selling direct to consumers. The Internet has leveled the playing field for all industries, removing some of the necessity and value that retailers have traditionally provided. Yet there is still room for differentiation. Retailers should know their customers more intimately, and provide them with more personalized service than a manufacturer is able to provide. They still provide a walk-in option when that is needed. People want personal service now more than ever.

Guidry: The manufacturers have to have a robust web presence. However, I believe it is bad business to deprive dealers of product so that the company site may make sales. I believe it is predatory for manufacturers to sell products at the company site for less money than a dealer can sell that same product. The dealer must have some margin protection from above for such a system to sustain itself. My position assumes that the manufacturers value the showcases and local support that stocking dealers provide. Maybe they foresee a day when the web can provide a pre-purchase experience that is rich enough to render real product demos useless. More shocking things have happened.

Byrd: Products are not what people usually purchase. They are purchasing solutions, which is defined as products combined with the knowledge of how to use them to meet our personal needs. Manufacturers cannot provide this personal attention, only knowledgeable retailers can do this.

Almeida: At Fujifilm, we have always been committed to our retail channel and channel partners, and will continue to do so. That has been the key to our success. Fujifilm is the only vendor with a comprehensive portfolio of technology solutions and services designed to meet any retailer’s photofinishing needs, and we will support retailers by connecting consumers to them through many on-ramps—online, mobile, in-store—and by providing flexible and scalable solutions to accommodate all of their needs.

Lee: We value the relationships we have with our partners and work closely to meet the tremendous consumer demand for our products and treat all channels equitably to satisfy the market, which is shaped by consumer demand for different shopping experiences. We only recently established a broader e-commerce offering to give greater choice to consumers, and an additional option to find a particular product model or color that one might not have access to otherwise.

Peck: The Canon website provides an important link to consumers, which serves many roles to enhance end-user relationships and provide opportunities to exchange valuable information.

We encourage consumers to establish this direct link with us, whether it is to view new products, join our comprehensive educational programs, answer customer service questions, be directed to an authorized Canon dealer, or the option to buy directly from us.

Our Canon direct store is not the primary channel for sales, it is an alternative to best satisfy the needs and desires of the end consumer. In many cases, it gives the consumer easy access to accessories that may be difficult to find elsewhere.

Provide your thoughts on the fact new product in short supply isn’t always allocated to retailers in a transparent system, where the first orders in are the first orders shipped but is oftentimes instead allocated on political basis.

Worswick: There are retailers who complain that suppliers will fill orders online before shipping to dealers. Dealers need to work to see that they get their fair share of product. This is a delicate balancing act. Apple is most frustrating. They prefer to sell hard to get products through their own website and retail stores. At least you can say that Apple has made significant investments at retail and are not simply pulling the cream off the market on the web.

Gustavson: Let’s look at this from a manufacturer’s perspective. The primary goal for the introduction of a new product is to maximize sales while maintaining margin integrity for as long as possible. This is most easily managed by limiting the sources in the supply chain. There will always be large retailers that have the “buying muscle” required to get the lion’s share of product allocations. The most effective means for a smaller retailer to ensure availability of hot products, is to develop a true partnership with a distributor that has significant clout with their manufacturer partners, and a dedication to the photo specialty retail channel.

Araujo: I’m sure these inequities occur, but also believe that many manufacturers try their best to allocate new products in proportion to what their retailers committed to. If you limit product to only a select few, you will quickly discover that you have eroded your broader base of medium-sized retailers.

Cutting: When inventory is tight, manufacturers may allocate product to those who they perceive to be most productive. Where possible, retailers should partner with vendors to demonstrate their productivity and potential. While retailers can’t control the allocation, they can work with vendors who they perceive to be the best partners.

The imaging retailer consistently has the well-merited honor of best customer satisfaction in salesperson knowledge, making the customer feel valued, and even offering a good price compared to any other retail channel. Photo specialty retailer brand recommendations carry much more weight than in other retail channels. The reliance that photo specialty consumers, particularly new DSLR buyers who are in need of solutions, have on a sales consultant translates into power to recommend products that satisfy customers and simultaneously deliver great margin. While not all retailers get the fastest allocation of the hottest product, they should find new avenues of expansion among other quality products that deliver better margins and long-term growth.

Comon: True. You have to build good relationships with both customers and vendors today.

Guidry: It happens. How you feel about it depends on whether or not you get the allocations. There is a “system” at play but I can’t tell you how it works. My retail stores don’t move enough boxes for me to demand answers. I say, “Thank you sir, may I have another.”

Byrd: I suggest retailers need to get their buying groups to increase their political clout and improve this situation for their members.

Almeida: While I am unable to comment on our specific policies of allocating products, I do want to say that we do our best to be fair to all our retail partners and to reach the consumer in an evenhanded manner.

Lee: We have very strong relationships with our channel partners and are very transparent about product availability because it is in all our best interests to meet consumer demand quickly. We treat all the channels equitably, and we work hard to avoid giving priority to any channel. Our focus is to make sure the consumer has a great shopping experience, no matter where they choose to shop and when there is greater demand than supply, we work closely with our partners to create the best outcome.

Peck: There are no “politics” involved in launching and bringing new Canon products to market. It is a matter of sensible and practical business planning in what is a very challenging economic environment.

We have historically brought to market new products that have helped build the imaging business and in many cases helped define the industry.

The problems of short supply are not new and go as far back as the AE-1, Sure Shot, ELPH, Rebel, PowerShot and so on. Despite these shortages from time to time, our retail partners grow their business, and the entire industry was revitalized.

As a manufacturer that designs and develops core technologies, engineers new products and manufactures those products from start to finish, it is extremely challenging to anticipate market demands particularly in this economic climate. The current economic landscape has put enormous pressure on companies to implement and maintain efficient inventory management, and those efficiencies have been stretched to unprecedented levels.

As an OEM of all of our technologies, we must struggle not only with inventory management but efficiencies in manufacturing. Considering these difficult factors, we do our best to supply hot new products to best support end user demand in all our markets and address each and every inventory need in a sensible, practical manner.

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