It is interesting to have a look at the financial performance of various companies that manufacture cameras. As could be expected, general trends are obvious… decreasing unit sales, revenues and profits. After the camera market peaked in 2012, it has been in a state of continued decline. This decline indicates that the future of the industry is with professional, enthusiast and unique cameras. The days of mass marketing inexpensive consumer-oriented generic cameras are over.
For those of you who would like to have a look at the current financial reporting of various companies here are a few links that you may find interesting.
Ricoh (cameras included in Other)
Panasonic (cameras under the Appliance division)
I remember back in 1974 when I bought my first interchangeable lens camera. The market was basically composed of three groups. Professional photographers. People who needed a camera for their work but were not pro photographers. And, enthusiasts who had the financial capability to own an interchangeable lens camera system so they could pursue their hobby.
Look at what has happened with successive generations of cell phones as more advanced imaging technology has appeared in them. Today, the photographic needs of the vast majority of consumers is well met by their cell phones. Generic point-and-shoot cameras have been in a sales free fall for many years.
It appears to me that the camera market is returning to its former structure of the 1970’s. That means that professional, enthusiast and unique cameras will become the norm.
It doesn’t take a rocket scientist to see that the total number of photographs being created around the globe is growing exponentially. The challenge for camera manufacturers is that a shrinking share of those images is being created with dedicated cameras.
It would make sense that camera manufacturers would segment the market by identifying the types of images being created. Then determine which of those image segments is best served by a dedicated camera.
Do most people need a dedicated camera to snap some quick photographs or record simple videos of family, friends or vacations? Not really. They can, and do, use their cell phones to regularly upload this type of material on their social media sites.
It is harder for a cell phone to provide images of more specialized content. Things like nature photography. Underwater imaging. Macro photography. Or sports photography to name a few.
To survive and prosper in the future, camera manufactures will need to become very efficient niche market differentiators in terms of their strategic orientation. The days of being successful by churning out huge volumes of nondescript “me too” products are over.
Being a niche market differentiator means choosing a small slice of the market and developing the best possible product for that market segment. Effectively defining and segmenting the market is where the future lies for camera manufacturers.
Unfortunately from a strategic standpoint, it appears that most camera manufacturers are still missing the boat. The current stampede to produce full frame cameras is just another form of “me too” product marketing. It isn’t the magic bullet that camera manufacturers think it is, and it won’t save them. That’s because focusing on sensor size is still maintaining a product orientation to strategy and marketing. That’s the fundamental mistake that most camera manufacturers are making.
So, in the near term most camera manufacturers will continue to flounder. Sales and profitability will continue to disappoint for the next number of years… even with a plethora of shiny, new full frame cameras. Many camera buyers will view the majority of these new full frame offerings for what they are… basically the same old cameras with a different sensor, but not much different or improved in terms of innovative technology.
Continuing declines in camera unit volumes and profitability will lead to predictable outcomes. Far fewer camera models. Higher unit prices. And, the eventual disappearance of entry level cameras with limited feature sets and comparatively low pricing. Perhaps even the disappearance of a few camera brands.
The smart camera manufacturers will figure out that continuing to take an old school product orientation with their strategy and marketing is a dead end. Some will begin to see and segment the market in a new way. They’ll segment the market by image subject type, and the attitudes that a photographer has about creating an image.
The age of psychographic segmentation will finally reach the camera market. It will provide the camera manufacturers with new, in-depth ways to understand the underlying reasons why we create photographs. As well as the attitudes we have about cameras and other image creating tools. That new way to look at, understand, and segment the ‘image creation’ market will help lead camera manufacturers out of their current strategic wasteland.
So… the future will be with professional, enthusiast and unique cameras… but they will be truly amazing!
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