Abhishek AnandKunal Ahuja

Nihit JainSanjay B K

Vaibhav KukrejaVaibhav Sathe

KODAK vs FUJIa battle for global market share

Section C – Group 8

Agenda

IntroductionAnalyzing CompetitionMarket DefenseMarket ExpansionExpanding total marketKodak TodayRecommendations

Introduction1997

EASTMAN KODAK COMPANYUSA Market Leader – 70%Worldwide share – 44%Japan share – 7-9%Pioneer of inexpensive cameras & easy to use films

FUJIJapan Market Leader – 70%Worldwide share – 33%USA share – 17%First to introduce one time use cameras

Clash of the Titans

SPONSORSHIP WARSFUJI film sponsor of 1984 Los Angeles OlympicsStrong foothold into US marketKodak sponsored ABC TV broadcast

LEGAL WARSKodak Complaint under US Trade Act, 301Antitrust allegation against FujiFuji rebutted blaming mismanagement of KodakWTO rejected Kodak complaints as baseless

Clash of the Titans

PRICE WARFuji cleared excess inventory at lower price sparked the Price WarFuji experienced strong market growthKodak did not intend to reduce prices initially thereby letting Fuji gain market shareAmerican consumers preferred Fuji as long as it was cheaper

1993

1994

1995

1996

1997

1998

0

20

40

60

80

KodakFuji

Kodak

Direct selling and contact with distributors and retailers (US)Effective division into SBUsGrowth and presence in markets outside US, reducing dependability of profits on the US marketOnline portal for receiving print orders Strategic location of business near talent pool e.g. Software business in Silicon Valley

Slow response to pricing strategy

Ineffective management of human resources

Late response to competition

Str

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gth

sW

eakn

esses

Fuji

Competitive low cost advantageStrong promotional & branding strategy through sponsoringEfficient financing Close ties with Distributors in JapanHigh Operational efficiency, high revenues per employeeStrong focus on R&D , allocated 7% of SalesDifferentiated product line up (first mover in OTUC )Web support for printing

Low payouts to employee

Neglecting profitability

More focus on long term growth

Str

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gth

sW

eakn

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Market Scenario

Competitive low costMarket growth potential in developing countries of Indonesia , China, Brazil & IndiaConcentric diversification into Digital imaging spaceTechnological advancement and increasing application in different fields leading wider opportunity for innovationIncreasing consumption of films by marketing the idea of photography as fun

US photo industry unstable and unpredictableSubtle change in US consumer attitude with acceptance to foreign products, huge trade deficits without any protectionist legislationDecreasing margin for manufacturersDigital Imaging is an increasing trend Strong US dollar is eroding kodak's export advantage

Op

port

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itie

sTh

reats

Market Defence

Market BroadeningFocus on R&D – embracing digital technologyConcentrating on getting non users

Market DiversificationConcentrating on emerging economies – Brazil Russia India China (BRIC)Developing economies still used Film and not digital cameras

Kodak Funtime Strategy

Niche marketing – Price conscious customer segmentCheaper than Fujicolor Super G., but higher profit margin.No advertising expenditureLimited presence and quantitiesValue packs, multiple speedsSome Cannibalization its own higher productsBut Retaining customers

Market Expansion - JapanRetreat in 2002 due to low demandRe-entry in 2004

Acquisition of ChinonTackling Issues in Distribution channelsLaunch of new productsPrimarily marketing Print SystemsSecondarily marketing Cameras, films

Kodak DX7590

Expanding Total Market

Investing in infrastructure and world class consumer centric productsPromoting Photography as a fun activityKodak MomentsKodak Moment of the monthPhoto Cards, Gifts and BooksBringing more people to take

photographs

Kodak TodayRegaining MomentumExpansion in Digital productsContinued decline in traditional productsDigital Camera competition from

SonyNikonCannon

High End SmartphonesAppleHTC

Online Photo sharing serviceGoogle PicasaFlickr

Touchscreen camerasVideo camerasDigital picture framesInk-jet printers

Recommendations

Products/Services Provide cheaper online print servicesTie-up with companies like zoomin.comSmart Phones apps to order print onlineKiosks at Mall for instant photo printing

PlaceMake available online services in emerging markets

PromotionPromote OTUC in tourist spots, malls