Kodak Funtime Case Study - Marketing

The problem in this case is concerned with Eastman Kodak losing its market share in film products to lower-priced economy brands. Over the last five years, in addition to being brand-aware, customers have also become price-conscious. This has resulted in the fast paced growth of lower priced segments in which Kodak has no presence.

My analysis will cover competition from substitutes and the change in buyer behavior and demographics. I will use the five forces model of competition and a SWOT analysis along with other sources of analysis. The information and recommendations that follow will provide you with the insight and building blocks to compete in the movie exhibition industry.

By mid 2002, the company had 349 screens in 31 locations and had generated a reported compound annual rate of return well in excess of 20% for its initial investors. 2-for-1 Wednesdays In the spring of 2001, Cinemex’s competitors began offering a special deal: any customer who purchased a ticket to see a film on a Wednesday (traditionally a slow day at the box office) would receive a second ticket at no additional charge. This ploy cut into Cinemex’s attendance figures (Exhibit 3). On five of the first six Wednesdays after the deal’s introduction, Cinemex’s attendance was less than in the same week during the previous year. Heyman faced a difficult decision. Should he offer his own two-for-one deal on Wednesdays? This might raise attendance, but since many tickets would be given away for free, it might also reduce ticket revenues. Or should he do nothing, hoping that the appeal of Cinemex’s customer service package would eventually bring customers back? Heyman’s first step was to review his attendance data. What made this difficult was that week-to-week attendance was highly variable, depending on (among other things) the time of year, the popularity of current films, local weather conditions, and the timing of holidays. The question was how to disentangle the impact of these factors from those of Wednesdays at Cinemex Page 2

4. Din, Yangon. (2007). Titled: The dynamics of the movie industry: Theatrical Exhibitions & DVD rentals. The University of Wisconsin.

Kodak is known for providing the quality services, innovative products offering the best quality to customers. It developed competitive advantages and satisfied its customers during many years. Kodak has evolved different strategies in the field of traditional photography where it brought innovations and modification. Kodak has a successful history in the industry. According to the case study, the main reason behind the success of Kodak in the industry is its quality.

Competition between theaters often comes down to distance from home, convenience of parking and proximity of restaurants. Innovations by one theater chain are quickly adopted by others. The differing approaches of the theater chain companies are reflected in their cost of fixed assets per screen.

Comcast brushed away its main competitor by purchasing a greater share of Time Warner. The major failures of Kodak were majorly because it failed to embrace and market new technologies for fear of hurting and damaging the company’s lucrative business in the film production at a time when new digital products were being reshaped. Management in the Kodak Company did not fully grasp how the world was gradually reshaping and therefore could not remain in the industry. They still hung on to old -fashioned technologies and assumptions how, where and who took the pictures. Large companies in the media industry should learn to embrace new trends that are appealing to the consumers’ tastes and preferences. The la carte approach is one example of such a new technology and program that should be embraced by all media companies (Einstein,

Fujifilm got its start with the production of motion picture film, dry plates and photographic paper. It was difficult for Fujifilm initially to develop brand recognition due to the market prevalence of the Eastman Kodak Company.   Fujifilm’s quality standards were not on par with Kodak and this created a challenge to gaining any traction. Fujifilm’s plan to compete was to develop film and paper that were compatible with the processing systems used mostly worldwide.   By 1969, all of their films, photo paper and chemicals completely matched these processing systems.   With the concentration on the quality of its products, Fujifilm was able to develop its first film product and a motion-picture negative film which proved to consumers in Japan that Fujifilm was technically proficient and resulted in a demand for their products.

5. The threat of substitutes: This is the strongest force of competitive pressure that the movie exhibition industry faces. Not only are they competing among each other but they have to compete with every leisure activity a consumer has to choose from.

Looking at where the company is in the market place, the cinema exhibition business segment has reached maturity (Reading International, 2013). Reading International will be looking towards improving their current cinemas to achieve more growth as well as developing niche-type of cinemas in selected markets and also procuring additional properties that contain existing cinemas. The objective behind these strategies is to attract more customers. Currently, Reading International targets several key groups of consumers by running various promotions across each country; school children are targeted with the ‘Early Bird’ promotion, students are targeted with ‘Terrific Tuesday’, working professionals with ‘Friday Flicks’, couples with ‘Steer & Beer’ restaurant ‘combo’ deals, families with ‘Spit the Dummy’, elderly with senior discounts, and general movie enthusiasts can sign up for the ‘Reel Club’. It appears that these consumers have been segmented on the basis of demographic grouping. What Reading International needs to be aware of however, is that there is a whole new generation of consumers that will have an effect upon how Reding International’s customers should be grouped over the next couple of years. This generation is known as the Net-Generation (N-Gen), and should

* Marketing- Kodak is the world’s foremost imaging innovator. Its reputation in the film printing business is dominant. Introducing a new line of cost efficient printer ink will be effective and popular. Kodak’s target market will include anyone with a household printer. Kodak’s goal will focus

In late March 1996, Ralph Norwood was faced with the task of restructuring Polaroid’s capital structure. In the past, Polaroid had a monopoly in the instant-photography segment. However, with upcoming threats in the emerging digital photography industry and Polaroid experiencing recent losses in their market share due to Kodak’s competition, Gary T. DiCamillo, recently appointed CEO of Polaroid, headed a restructuring plan to stimulate the firm’s performance. The firm’s new plan has goals such as to aggressively exploit the existing Polaroid brand, introduce product extensions, and enter new emerging markets such as Russia in order to secure Polaroid’s future.

1. How might the reward program described in case exhibit 5 affect the movie and event –going behavior of major market segments? At retail, what is the average value of each reward structure for customer’s dollars spent – 5 %, 10%, 15% or 20%? Which reward structure would you choose? Why? (For the sake of simplicity, ignore the one-time fees and rewards)?

Background Eastman Kodak Company, headquartered in Rochester New York, was founded in 1889. The corporation, now multinational and focusing on imaging and photographic equipment, posted revenues in excess of $6 billion in 2011. During most of the 20th century Kodak was dominant in the photographic film industry in 1976 it held 90% of the market but began a downward slide once the Internet, digital cameras and computer processing grew. By 2007, Kodak ceased making a profit and in January 2012 filed for bankruptcy protection and ceased making cameras, video cameras and began to focus on the corporate digital imaging market (De La Merced, 2012). In evaluating Kodak's corporate strategy from the mid-1980s onward, we find that there four major management paradigms in place during this transitional period:

Eastman Kodak Company, commonly known as Kodak is an American multinational imaging and photographic equipment, materials and services company headquartered in Rochester, New York, United States. It was founded by George Eastman in 1889. Kodak is best known for photographic film products. During most of the 20th century Kodak held a dominant position in this sector. In fact, Eastman Kodak Co. is one of the dominant market share holders within the camera and other photography-related industries. Kodak pioneered amateur photography and is often credited for the invention of roll film and the first camera. The markets for color film and color photofinishing in 1954 were controlled by Kodak. It had over 90% of the amateur color