Kodak Essay

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Eastman Kodak Company is an American company focused on manufacturing photographic, print and film related products such as digital cameras, printers and scanners. It was founded in 1888 and is headquartered in New York, United States. In order to understand Kodak´s situation back in 1993 one has to know what the market was like at this time. Eastman Kodak Company was the strongest player in the early 1990s and Kodak Gold Plus was seen as the industry standard. In 1993, the US photo and film market consisted of 670 million 24-roll exposures whose prices ranged from $2.50 to $3.50, resulting in a total of approximately $2 billion. The industry was mature, leading to a 2% annual growth, and the market was relatively concentrated with four major players, namely, Kodak, Fuji, Agfa and 3M. Eastman Kodak Company and Fuji sold branded products, whereas Agfa and 3M sold the products b2b and b2c under private labels. Polaroid sourced its products from 3M. Among the film companies Kodak had the highest market share with 70%, far beyond companies like Fuji (11 %) and Polaroid (4 %) as well as private label (10 %) and other (5 %). (Exhibit "Market Share") However, Fuji´s global sales of $10 billion made it half Kodak´s size. Even though Kodak was the dominating brand, it faced the problem of a 6% decline in market share within the last five years and a 3% drop in sales in the last year. At the same time, Fuji´s and Polaroid´s sales grew more than 15% in the past year. This is closely linked to the four price tiers in the film market, namely, Superpremium brands, Premium brands, Economy brands and price brands. With prices ranging from $4,27 to $4.69 Fuji and Kodak are positioning themselves in the high price segment through their superpremi... ... middle of paper ... ...ad price sensitive picture takers to switch to other suppliers when Funtime is not offered and probably even longer. Furthermore the advertisement budget distribution has counterproductive effects: Not educating people about a new product is a decision, which I would never expect from high ranked executives. In contrast I would market Funtime from the very beginning on and even offer it during the whole year. Additionally I would price Royal Gold a little bit higher. The problem Kodak faces here is that the price of Royal Gold is too close to Gold Plus and could cannibalize it. Beyond that I would sell the products with a different distribution strategy, making them available to a broader audience. Even though Kodak basically made the right decisions, there were still some strategic mistakes, which would improve Kodak´s outcome in terms of sales and profitability.

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