I am currently taking a photography class at school to fulfill the “Arts and Literature” requirement. On the first day, we were told that we could use any camera that we wanted to use to take pictures for class, as long as it wasn’t the camera from our phones. When I got home later that day, I started looking around my house to see if I could find the almost seemingly ancient relic that is the Digital Camera.
I kept looking around my house and never actually found one so I decided to hop on EBay and order one for myself. I decided to order an Olympus Camera for two reasons.
1.) I vaguely remember that it was the brand of the most recent family camera that we owned (ages ago).
2.)On EBay, the Olympus brand had much lower prices than its competitor’s (like Sony, Canon, Nikon). I actually ended up buying the camera for $2.50(It was a 16MP camera, it worked, and the model is below).
During my search, I began to notice a constant theme, which was that a simple “Digital Camera” search on EBay resulted in the majority of cameras being sold were of the Olympus brand. This intrigued me and I decided to do some more research on the company.
With the rise of camera phones, the only companies that have a firm grasp on the camera market are Nikon, Canon, and Sony (likely because of their vast resources, brand names, continued innovation, and they can sustain losses better than smaller companies). With the rise of camera phones, this is no longer a market that can sustain a “cheaper” alternative camera company. Olympus has less than a 7% market share and has failed to generate a profit from its digital camera segment in the past three years. In terms of digital cameras, the three corporate camera giants has seemingly been able to produce small profits/get by with losses in the digital camera segment because of their brand name and also because their huge profits from their optical premium lens cameras allow them too. Olympus’ decline has caught management off-guard, so much that their actual sales were less than 2/3 their forecasted sales in their most current year.
Olympus’ biggest advantage was that they once had many patents revolving around having “light-weight” cameras and were held in very high regard in the market in the 2000s. This advantage has quickly disappeared with camera phones also being “light-weight” cameras. A current great advantage is that one of their premium optical lens cameras, the OM-DE-M10 Company Camera (not a digital camera) is regarded as a great, cheaper alternative to the pricier Nikon, Sony, and Canon cameras.
Their greatest current disadvantage is that they do not have the deep pockets that the huge corporate giant camera companies have. This is important because these companies continue to reinvest and spark innovation, something Olympus has seemingly failed to keep up with.
According to 24/7 Wall Street, who releases a speculative report annually that lists companies that are most likely to disappear during the year, listed Olympus as their 6th company most likely to be gone in 2014.
There is no doubt that the company is in the decline stage. The EBay search alludes to an over capacity in the market. Their cameras also do not have a high product differentiation like the huge camera companies.
Would you agree that they are in the decline stage? What advice would you offer Olympus so that they can prevent disappearing by the end of this year? Do you own a digital camera? Why or why not? What impact have camera phones had on the digital camera market? Knowing that even the huge corporate camera giants have problems sustaining profits in the digital camera market, what advice would you give to them?
Sources:
http://247wallst.com/special-report/2013/05/23/ten-brands-that-will-disappear-in-2014/3/
http://www.ukessays.com/essays/marketing/decline-stage-of-the-product-life-cycle-marketing-essay.php
