Hidden Reasons for Kodak's Digital Revolution Essay

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.

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.

1. Diagnose the reasons for Kodak’s market share loss and make your assessment of the likely development of the market if Kodak maintained the status quo.

Thomas Sowell discussed that Kodak was a leading film maker in 20th century, but was suppressed by the sales of digital camera three year after the year 2000. The new innovation of digital camera technology caused Kodak to become bankrupt. Although, even if the bankruptcy of Kodak caused losses like lay-offs, and smaller production of goods at a lower quality, there are benefits to bankruptcies. One benefit of bankruptcy is the government can shut down a business when the business cannot pay off its debt, which stops the use of resources that is not benefiting the economy. For example, when digital camera innovations made Kodak cameras obsolete, Kodak sales dropped and the company acquired debt. This

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.”

Technology is constantly advancing with new ideas and developments of old ones. The newest invention surpasses the version previous, and devices become outdated and need updating. As evolving humans, it is natural to discard obsolete technology and to succeed it with improved means of communication that best fits the demands of the public. However, since the 19th century, one demand has remained timeless: the desire to capture moments in the form of a photo. George Eastman’s innovations opened up the door to seemingly unimaginable possibilities in the world of photography, and with his influence through the Kodak company and philanthropical contributions, the world has benefitted remarkably.

“[Eastman] added to the company's established production of photosensitive materials by designing a simple-to-operate, highly portable roll-film camera, the Kodak, and by providing factory service that included the unloading and reloading of the camera with film and the developing and printing of the pictures” (Cooper 329). Creating a camera that was mobile made it possible for more people to easily have a camera with them at most times and take photos whenever they please, like how most people today carry devices in their pockets that can take photos with the tap of a button. Not only that, but consumers could effortlessly send their film to back to Eastman Kodak and have their photos developed, without having to do so themselves as they would have before. While George Eastman was a significant figure in the department of film, it was not the only industry that he

For a century, Eastman Kodak Company was a leader in their field of capturing images on film but in the late 1980’s the company was struggling to be at the top of their field. According to Bolman & Deal (2008, p. 93) “its name and film were known around the word, but the company had been rocked by intense competition, high cost, declining customer satisfaction, threats of hostile takeover, and low employee morale.” The CEO, Colby Chandler, understood that reorganization was necessary so that the company could emerge from decline. Chandler decided to divide the company into six different divisions, one being the black-and-white film division, which evolved into the most successful division of the company (Bolman & Deal, 2008). The executives in this division examined what changes, expectations, and productivity they wanted for the division and its employees.

Kodak was doing extremely well in the market but its failure can largely be attributed to the leadership. This is because the company at some time lacked a visionary leadership that was able to comprehend the changes that were taking place in the external environment and ensure that the necessary steps were taken. For example, even though to a certain extent the failure of the company is attributed to failing to adapt to digital technology, the greatest blame lies with the leadership. This is because Kodak having dominated the imaging and photography industry for long, the company was the first to develop a digital camera way back in 1975. This means that the company had the necessary knowledge, supply chain, workforce and other resources necessary to enhance the company’s competitiveness (Pham-Gia,

Company Eastman Kodak is currently the market leader in the photo film market. The company has continued its domination of the photo film market, but in the past 5 years its market share has eased from 76% to 70%. Reason mainly being the competitors like Fuji Photo Film Co. and Konica Corp. lured consumers with their lower-priced versions. In 1993, Kodak spent an estimated $50 million on camera and film supply advertising in the United States; this was about 4 times

Company Eastman Kodak is currently the market leader in the photo film market. The company has continued its domination of the photo film market, but in the past 5 years its market share has eased from 76% to 70%. Reason mainly being the competitors like Fuji Photo Film Co. and Konica Corp. lured consumers with their lower-priced versions. In 1993, Kodak spent an estimated $50 million on camera and film supply advertising in the United States; this was about 4 times its

Kodak’s management approach on pursuing innovation by representing the latest innovation in the company’s consumer inkjet portfolio, marrying effortless connectivity with Kodak’s unique combination of high quality output and affordable ink. Kodak is committed to providing customers great value and lowest total ink replacement cost and exceptional cost per page. Fujifilm’s management approach on pursuing innovation by increasing a range of fields from imaging to medical systems. Fujifilm also became a much diversified company than Kodak by having a longer term vision in store and by investing a lot.

Kodak’s decision to create and market two million units implies that the project life cycle and the product life cycle are intertwined

Kodak Corporation is one of the film organizations that have obtained a bigger piece of the overall industry in the United States. It is prestigious for the generation of

Kodak is American Technology Company that was found in 1890s. Kodak main focus is photography and imaging product. Recently, Kodak decided to enter the printers industry by designing a new line of printers that produce high quality photos. Kodak also will introduce a new line of printer ink, and photo paper. Kodak main challenge is competing against the market leader in the printing industry Hewlett Packard (HP) which has the largest market share in the printing industry. Also, Kodak is entering the market twenty years late than its competitor in the market who are more experience in term of the wants and needs of the consumers. In addition, increase in the industry rivalry with HP and risk in new product and offering would be a challenge that Kodak management has to overcome in order to stay successful in business.