Attempt all the questions.
Section-A
Question1) Why is India considered to be the world’s most attractive retail market?
Question2) “The Indian Market is gradually become consumer oriented”. Explain the statement with reference to rising retail sector.
Question3) Explain ways in which services could streamline and improve operational efficiency and profitability of a retail organization.
Question4) What is the life time value of customer.
Section-B
Case Study : Seeking new angles: Digital camera mania has forced film suppliers like Kodak to find new ways to build their brands’
The rapid transition to digital media is throwing up some new brand winners, with Samsung and Apple among the most obvious beneficiaries.
But shift has also claimed several victims. In the photography market, while camera makers such as Sony, Canon and Olympus have managed to establish themselves as digital photography brands, move of digital has proved tumultuous for many film suppliers and photo-service providers such as Kodak.
Sales of digital cameras have soared in past few years. Eight million digital cameras were sold in Europe in 2002: some 24m would be sold both in Europe and North America this year, according to industry estimates.
This has meant the need for photographic film has declined, as has the demand for professional photo finishing: in the past month, Kodak has been forced to close five laboratories in the UK alone, with loss of 500 jobs. And Kodak plus other main photographic brands, including Fuji Film and Agfa , have been forced to take a careful look at their marketing strategies.
Fuji, for instance, has never been in retail film-processing business but has, for the past 20 years, concentrated on mini-labs, both analogue and digital, for high street photo shops, and now has some 20,000 installed.
With most of the digital photos being printed at home, computer printer brands like Hewlett Packard, Epson and Lexmark have become strongly associated with digital photography.
According to Mette Eriksen, analyst with consultancy Infotrends/CAP Ventures, some 70 percent of European customers printed their photographs at home in 2003: ‘At home, most consumers are using inkjet printers, and the small proportion are using dye sublimation printers. (The latter are more expensive, but produce the result that is much closer to professional photofinishing.)
The emergence and rapid growth of unfamiliar brands such as Snapfish is symptomatic of the turmoil surrounding photographic industry. Virtually unknown only four years ago, Snapfish now claims to be leading online photo service in North America, with more than 10m customers. It has just opened for business in the UK, where it clearly sees a void crying out to be filled.
Managing director Helen Vaid says: ‘Online photoservices are not as established here as in the US, and customers are not so aware of the options open to them.’ Snapfish’s photofinishing processes are based on software developed by company, but it still makes the marketing point of the fact that digital images would be printed on Kodak paper.
Eriksen says that in US, digital camera owners turn to retailers for print orders of 10 or more photos and use their home printers to make the small number of prints rapidly. She expects that European market would follow the same trend. This is good news for the commercial photofinishers such as Snappy Snaps or Jessops, or online services like BonusPrint or Ofoto (Kodak’s own).
A more recent development. Though, has been advent of supermarkets’ own-brand photservices. Pixology, for instance, the UK software company best known for a technology for eliminating ‘re eye’ in digital images, is providing processing power for photokiosks in stores belonging to Dixons, Currys , John Lewis and most recently, Tesco.
Pixology software is used to power digital photo kiosks in 165 Tesco stores: customers could insert their smart media cards, preview the images on screen and process their orders at a mini-lab in the store. The service, though, is Tesco branded.
David Honey, Fuji’s UK general manager for photofinishing, admits present situation is difficult for big film suppliers trying to maintain strength of their brand. He says innovation, revenues and profit margins are all required to provide the marketing which supports the brand.
In the meantime Research group IDC forecasts home printing of digital photos would fall to 42 percent by 2007. Honey also predicts that novelty of printing at home would quickly wear off, and that only 10 percent of photographs would be printed at home in the future: “ You could do it, but it’s expensive, difficult and fiddly.’
So could the likes of Kodak and Fuji resurrect themselves as digital brands? JamesMcConell, head of Kodak in UK, believes company name is providing retailers with measure of comfort: “Kodak brand is vital than ever. Retailers want a brand which means imaging.’
So Kodak is riding on all horses: home printers and internet processing on the one hand, and in store mini-labs and kiosks branded with the Kodak name on the other. Boots the chemist alone has some 1,400 kodak-branded kiosks.
McConnell has just written to some 9,000 retailers in UK outlining the company’s plans to develop its kiosk business. And own-brand operators? We’ve always had people who operated their own-label processing and printing,’ he retorts.
Of course, branding issue is just one of the number that are keeping the industry in ferment: how quickly will digital replace film? To print at home or via the net? Would cameraphones take place of single-use cameras? “These are lively topics, but we have far too many to discuss,’ says Fuji’s Honey, wearily. “They’re getting in the way of work.’
Questions:
Question1) Write a short statement providing your assessment of Kodak’s strategic marketing options form Seeing First Perspective.
Question2) Look at the variety of data in case. Using your judgement, develop simple marketing strategic rule for Kodak that will affect degree of its involvement in the home printing market.