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8/6/2019 Rogers Gillett Kodak Case Presentation
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Kodak Funtime FilmsOla AllaymounEcho Chen
Carli GillettEricka HightowerRanjani Venkataraman
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Agenda
Company Background
Current Problems
Major Market Players Market Share
US Photographic Industry
Consumer Behavior
Kodaks Market Strategy before 1994 Fujis Strategy
Kodaks Proposed Strategy Recommendations
Evaluating the recommendations
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Company BackgroundKodak was founded in 1892 by George Eastmanand Henry Strong
George Eastman gave the advertising line Youpress the button, we do the rest
Market Leader in US Enjoyed Monopoly before the entry of its
competitors
Sold cameras, films and other imaging products
Entered professional tape market for a brief periodin 1980s
Largest supplier of photographic films in the world,
for the amateur, professional, and motion picturemarket
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Current ProblemsLost 8% stock value in one week
Due to rumors of price cut
Losing Market share in its home territoryMarket share dropped from 76% to 70% in 5
years(1989 1994)
Slow Growth rate due to competitorsKodak growth rate 3% in 1993
Could not compete with its competitors in PriceCould not sell private labels due to aconsent decreeHigh advertisement spending pushing up
the price
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Market Share
O ther
5%
Fuji
11%
Polaroid4%
Private Label
10%
K odak
70%
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Th
eU.Sp
hotogra
phicfilmind
020 0
60
80
00
70
72
7
76
78
80
82
8
86
88
0
Year
Annual Market Share
ui
oda
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Kodaks Marketing Strategy Before
1994
Positioning Strategy
Spent heavily on advertising products
Positioned as a provider of superior quality
films
Marketed 2 products
Super Premium Brand
Kodak Ektar targeted at advancedamateurs and professionals
Premium Brand
Kodak Gold Plus flagship brand
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About Fuji
Sold only branded products.Worldwide sales of $10 million (halfKodakssize)
Started serious competition with Kodak in 1984by becoming the official film provider of the1984 Summer Olympics in Los Angeles
Growth Rate of 15% in 1993Price was 20% below the price of Gold Plusbrand
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vs
Similarities
Fuji and Kodak both sold onlybranded products
Offered superpremium brandswith a target market of
professionals and advancedamateurs
Contrasts
Fuji was a leader in theeconomy brands market whileKodak was not in the market atall initially
Kodak s marketing throughadvertisements was much
heavier (in order to position theproducts in the minds ofcustomers) Kodak spentmore than 4 times more onadvertising than Fuji
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Film Distribution
0
5
10
15
20
25
30
35%
D iscount &
D epartm ent
Store
D rug Store Cam era Shop Super M arekt &
C onvenience
W holesale
C lubs
M ail O rder
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Consumer Behavior
x
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Consumer BehaviorProductProduct Price ($)Price ($) QualityQuality RankRank
Super premium BrandsSuper premium Brands
Fujicolor RealaFujicolor Reala 4.694.69 9090 55
Kodak EktarKodak Ektar 4.274.27 9292 44
Pr
emium Brand
sPr
emium Brand
sKodak Gold PlusKodak Gold Plus 3.493.49 9393 33
Agfacolor XRGAgfacolor XRG 3.493.49 8888
Economy BrandsEconomy Brands
Fujicolo Super GFujicolo Super G 2.912.91 9494 22
Konica Super SRKonica Super SR 2.912.91 9393 33
Scotch Color (3M)Scotch Color (3M) 2.692.69 9292 44
Price BrandsPrice Brands
Polaroid High Definition (3M)Polaroid High Definition (3M) 2.492.49 9595 11
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Kodaks Proposed Strategy -
RepositioningBenefit segmentationNew Emulsion TechnologySegments included:
Gold Plus as flagship product and no price
reduction on thisSpecial memories targeted consumers whowould be attending graduations, weddings, babybirths, etc.Diverted 60% of advertisement spending for
promotion
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Kodaks Proposed Strategy -
Repositioning
Royal Gold good strategy to replace unprofitableEktar
Unexpected moments targeted wider audience thatwould utilize the film on a more regular basis for any event
that was not targeted by the Royal Gold film Will have rich colors and sharp pictures
Specifically targeted at customers looking to makeenlargements
Diverted 4 % of advertisement spending for promotion
Prices % above Gold Plus for higher trade margin
Funtime to compete in the Economy Brand Market
Priced % below Gold Plus
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Important Features of Funtime
StrategyNiche marketing
Price-conscious customers
% advertisement spent
Limited presence 2 times an year during off peak season
From April to JuneFrom September to November
Sold in limited quantities
To be made available in speeds
ISO 1ISO
To be made available only in value packs
rolls of 4 exposures
4 roll package with 3 rolls of 4 exposures and 1 roll of 3
exposures
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Snapshot of New Strategy
Specifically Why Funtime??
Bolster the return of formerKodak customers
Use Funtime to segment a specific Market
Lure non-Kodak users
Good price for price-conscious customers
Cannibalization took some focus off Gold products but overallretained customers forKodak rather than letting them go to Fuji
Though Funtime is cheaper than Fujicolor Super G,Funtime has higher gross profit than Fujicolor Super G.
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Recommendations
Funtime should be made available throughout the year
Single packs should also be made available in limited
quantities at department stores and discount stores
Channelize some advertisement dollars towards
Funtime promotion
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Why?
All Year supply Price sensitive customers can buy it all round the year Definition of off peak season not clear. April June does
not seem to be off peak
Single packs Target customers who are price sensitive but do not like to
buy in bulk Distribution in discount and department stores as most
customers buy from there Funtime Promotion
Kodak Gold is an already established brand Funtime needs to be advertised to make people aware of
this product
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