The fall of Kodak – a marketing or a product issue?Digital Manager
Last week it was reported that Kodak had filed for Chapter 11 bankruptcy protection, marking a spectacular fall from grace for the 133 year old household brand. Yesterday morning, Stephan Shakespeare, the founder and CEO of YouGov, wrote an article in City A.M. in which he came to the conclusion that, although most would prefer not to see Kodak fade into the ever-expanding category of extinct retailers, the fact is that the same people don’t want to buy Kodak products – an accurate summary. Yet this does pose the question, how does a brand like Kodak, for so many decades the definitive face of photography, end up in such a state? Is it the fault of the brand image, or just poor quality products?
There is no doubt that the introduction of digital cameras did not present the problems for Kodak that technology experts first predicted when, in 2000, they vowed to become the leader in the field. They did. Within 5 years. They led the way in innovative digital camera design, leading to a 40% rise in sales. However, this also led to an 18% fall in their film-based business, a loss that they failed to replace. But there was little indication that 7 years later Kodak would be in danger of falling out of the market completely.
In terms of the products themselves, there is some indication that their rising competitors are outperforming them in two distinct ways – variety and quality. Take the Kodak EasyShare 2981 Camera, a 14-megapixel camera with a 26x zoom lens (in layman’s terms, a larger-than-average camera for an experienced photographer) and compare it with two cameras of similar price and specifications – the Panasonic DMC FZ45 and the Fuji Finepix HS20EXR. On the popular camera website cameras.co.uk, the Kodak scores a 73 ‘poor’ rating while the Panasonic and Fujifilm products score ‘outstanding’ scores of 87 and 86 respectively. This appears to be a repeating theme in other reviews – it may be a well established brand, but consumers will not buy products that are not as good as others. It should also be noted that Panasonic isn’t even a photography specialist, something that should have set off alarm bells in Kodak HQ in New York.
So, the products certainly aren’t helping Kodak stay afloat, but what about the image of the brand? The two are intrinsically linked, but you can’t help but feel that the image that Kodak projects is equally damaging. Looking back at the popular 2005 ‘Live Forever’ Kodak television advert, it represents a forward thinking brand (the advert was about the concept of digital photography) at the top of its field. The advert signalled something new and exciting. Compare that marketing success with more recent adverts. The 2011 ‘Beautifully Cheap’ advert for the Kodak Inkjet printer demonstrates an alarmingly misdirected marketing strategy as it portrays a couple of children using the printer. Rather than thinking in line with what Kodak are suggesting (“wow, that printer looks like fun”) the first things that pop into your head are; how many 5 year olds have ‘photo printer’ at the top of their Christmas list, and how many adults want their children to be fiddling about in an expensive piece of electronic machinery? The storyline in the advert is actually quite clever, but it is aimed at completely the wrong demographic. When you compare this to the slick and creative ‘Balloon’ advert for the FujiXerox or the current ‘Bungee’ adverts for the Fujifilm Finepix range, the distance in quality between the brands’ images becomes apparent. The ‘Bungee’ ad is a great example of tailoring the image and representation of your brand to your key demographic – something that Kodak are falling short on.
There has been a lot of press lately regarding the demise of certain well established brands, with general public opinion being that it is a sad fact, but the brands are to blame. Branwell Johnson wrote an article today in Marketing Week on brand trust – an area that 50 years ago meant everything in the retail sector. It still does, to a certain extent, as is shown by YouGov’s BrandIndex – there is only one new entry in the UK’s Top20 list of brands. He argues that brand trust is quickly disappearing from the retail landscape in general, but re-emerges in times of economic hardship. This is not to say that brand trust doesn’t still exists, but it is much harder to gain that in previous years and must be supported by a smart image and good products.
This is where Kodak has come unstuck. It is no longer able to get by on sentimental charm and is being outperformed by competitors both in terms of its image and its cameras. It will be a sad day when Kodak is no more, and a day that hopefully can be avoided for the meantime but, unless it embarks on some extensive reinventing, Kodak could soon join the ranks of Woolworths, MFI and Zavvi.
Stephan Shakespeare included a warning to brands in yesterday’s article – “the world changes and unless you change as well, you will struggle – no matter how much you are liked”. This reinforces a point that those at Kodak HQ would ruefully reinforce, a brand must be both cutting-edge and smartly marketed to stay afloat in the modern retail world – neither brands nor consumers are what they used to be.
Edward Lowcock, Junior Account Executive