Canon Case

The problem in this case is concerned with Eastman Kodak losing its market share in film products to lower-priced economy brands. Over the last five years, in addition to being brand-aware, customers have also become price-conscious. This has resulted in the fast paced growth of lower priced segments in which Kodak has no presence.

Polaroid’s overall growth strategy was to be the number one and only instant photography company through the invention of it’s own technology in its own laboratories. “Growth objectives are a key part of an organization’s overall strategic plan. Almost all strategic plans deal with the size the company wishes to be in the future” (Human Resource Management pg. 110). One of the ways in which Polaroid planned to be the only instant photography company—in turn would also make it the greatest—was through 533 patents. “Polaroid is still characterized by many as a company that hold too tight a grip on its patents” (Human Resource Management pg. 130). Polaroid’s strategic plan was always to stick with their one invention, improve on it’s technology, and target the sole market. This affected HR planning and strategy because Edwin H. Land did not want to enter other markets; Land wanted Polaroid to be about instant photography. The decision to stay in only one market affected HR from doing what they are suppose to do. It prevented them from being creative or innovative.

It was Kodak’s’ strategy to sell the cameras at low prices, and it used to earn revenue from the films; this strategy is called the razor-blade strategy. This model for photography became flop when Sony introduced a camera with floppy disk inside, in which there wasn’t any use of films. As a result of Sony’s introduction of the Mavica in 1981, Kodak took it as a threat and started investing in the digital photography. For this purpose, it has conducted a huge research on the digital photography. As exposed by Fisher in 1997, Kodak’s respond wasn’t appropriate for the digital world: “One of the mistakes we [Kodak] have made is that we [Kodak]’ve tried to do it all. We [Kodak] do not have to pursue all aspects of the digital opportunity and service side.”

The problem in this case is Kodak's steadily eroding market share and shareholder value in the film rolls market. This is especially undesirable given the fact that the market has been growing at a tepid 2% annual rate and the steadily increasing threat from competition. Kodak needs to come up with a strategy for corrective action so as to arrest this decline, regain market share and increase share holder value. Kodak's strategy is to reposition itself by targeting a new segment of price sensitive customers and re-segmenting the super premium customers’ space by including a wider segment of special occasion customers.

The names of Kodak and Fujifilm are well known around the world. They are two companies that have made a name from photos, film, cameras and printers. They are competitors that started in the same business and took different paths. Though they shared similar products their management direction and company direction differed. The differences led one company to be successful and the other to struggle.

The developed marketing goals and objectives will determine how the company runs its business. This marketing objective can:

When Kodak began making changes to its organizational architecture in 1984, its current architecture did not fit the business environment for the industry. The largest factor that motivated Kodak to make this change was increased competition and decreased market share. Until the early 1980’s, Kodak owned the film production market with very little competition. This suddenly changed when Fuji Corporation and many other generic store brands began producing high quality film as well (Brickley, 2009, p. 358). Another factor in this change was technology advancements. As technology rapidly expanded in the 1980’s, other

* Marketing- Kodak is the world’s foremost imaging innovator. Its reputation in the film printing business is dominant. Introducing a new line of cost efficient printer ink will be effective and popular. Kodak’s target market will include anyone with a household printer. Kodak’s goal will focus

What I feel about Kodak’s move was that they are trying to make a space for themselves in an already crowded market. Kodak is trying to carve out a niche for them by offering inks for low prices. But, they have forgotten the abilities of the competitors. They have probably underestimated them. HP and Canon are big names in the printing industry and because of their continued rollout of good quality products; customers trust them more than they trust Kodak. It is also observed that Kodak had forgotten that if HP lowers their price to almost the same level like Kodak, Kodak won’t stand a chance. The only way that Kodak can hope to make some profit is by hoping that their competitors won’t reduce the price of the inks as it is the only source of revenue in the printing industry. But I am pretty sure that marketing research people of Kodak has made a blunder by opting for this. The major fact is that they have forgotten cartridge refilling industry which is cheap too and people have started to use that as they are comparatively cheaper to the original printing inks. I sincerely feel that Kodak has taken the wrong path to get out of their troubles.

While Eastman Kodak has remained an industry leader in the sales of film for photo-imaging, over the past five years Kodak has underestimated the demand for digital cameras. Digital cameras require no film whatsoever and with Kodak’s main line of production being film Kodak has suffered great losses in net profit. Just in 2004 Camera film sales have been falling even than projected. The Photo Marketing Association predicted a six percent drop in film sales and Kodak projected an even more dismal 10-12 percent drop in film sales. The actual drop in sales reached an unforeseen 18%. In 2003 digital camera sales were greater than traditional film camera sales for the first time.

Kodak’s competitive advantage began in black and white film products, even though the company did produce cameras and camera equipment as well. As the years progressed, Kodak “paid progressively less attention to

“Setting objectives for a marketing plan is not simple and straightforward matter. It is an iterative process whereby objectives are set, strategies and action plans are developed, and then it is decided whether the planned objectives are impossible, achievable or easy. Marketing objectives should be difficult, but they must be achievable. The aim is to set objectives that a challenge, but can be achieved with effort. They must be motivating rather than discouraging.” (Westwood, 2002).

In 1979, Canon’s concept became a resounding reality. They were able to produce a photocopier that not only met and exceeded the cost and reliability targets that were set by Top Management, but in a more practical application, it was able to reduce the need for constant and continual copier maintenance. Based upon previous experience with patent law, Canon employed the use those laws to protect their new found development.

Canon has around 77 years of history and it is full of ups and downs, highs and lows, for which it is what we would expect in such a high innovative company. Over the years, Canon has been introducing various types of products over the years and gradually became the leader in imaging markets. When people think of buying a camera, first brand pops out in their head is “CANON”.

Protected by patents, the competition for the company in the field of instant photography was low. The attempts to diversify