You’ve got to ask, “What happened to the Kodak moment?” Japanese camera-makers Canon, Nikon and Sony have clearly stolen the thunder from their American peer in recent years, enjoying the highest market share in India. But opportunity and challenge come bundled for most gadget brands in this tricky market. Canon stands out for its clever balancing act.
The target consumer remains price-sensitive, even as he or she knows more about brands and is likely to consider quality and value over just price. But Canon’s growth in India is not incongruous with its accomplishments in its strongest geographies.
President and CEO of Canon India, Kazutada Kobayashi makes a pertinent point about Indian consumer behaviour and choices: “One word for it, price-for-value. The consumer here believes it is worth paying a certain amount for quality, stability and the enjoyment they draw from the product, so we have a good market. Canon is on the middle and upper end of the price-point range, but demand in India is versatile.”
Unlike other well-known camera brands, Canon focused early, and heavily, on office solutions to beef up profits year-on-year. But while this segment still makes up more than half of its global business, its cameras will always be its greatest link with consumers.
In India, significantly, cameras account for 46 per cent of its business. But the company had to constantly think on its feet during a difficult economy the past few years, often realigning its strategy based on consumer responses to its cameras.
Stiff tussle from ‘go’ When Canon formally established its Indian subsidiary in 1997, it first challenged other brands in the compact camera segment.
By regularly hitting the market with new models, and exposing consumers to better quality photography, it prepared the ground for what was to come.
In 2002-03, Canon launched DSLR (digital single lens reflex) cameras in India, “changing the industry”, as the Executive Vice-President of Canon India, Alok Bharadwaj, likes to emphasise.
Historically, though, Sony has had a better ride in India with its compact cameras, while Nikon has forcefully maintained that it holds the No. 1 position in the Indian market.
In May 2013, 6Wresearch reported, “In the compact digital camera segment, Sony is the market leader whereas in the DSLR segment, Canon leads the market.”
Later, in August, the website reported that “Nikon and Canon experienced impressive growth” between the first and second quarters that year. It said that Nikon emerged the market leader in the DSLR segment, with 34 per cent growth, in the second quarter.
Canon has said it eyes ₹5,000-crore sales in India by 2015. In September 2013, it announced it was entering the eastern region with plans to capture 50 per cent of the DSLR market. It reported 27 per cent growth in the region for DSLR in 2013 against 10 per cent nationally.
More recently, Bharadwaj acknowledged Canon’s largest market, saying, “The South is a very photography-loving region.”
Confirming a significant movement towards DSLR, 6Wresearch’s statement on Q4 2013 says, “The compact digital camera segment registered a decline of 17 per cent in terms of unit shipments whereas DSLR range of cameras exhibited an eye-popping growth of 59 per cent compared to the previous quarter…”
More than ten years after launching DSLRs in India, and despite reports of declining sales in mature markets like the US and Japan, Bharadwaj declares, “We’re expecting it to be at 80 per cent in two years’ time in India. The year 2013 has been a landmark one, which saw consumers shifting away from compact to DSLRs. This segment has grown 30 per cent for Canon this year. In 2009, only 32 per cent of all cameras were DSLR. In 2013, over 60 per cent of our business has moved there.”
Clicking with women Canon’s way forward in India will be to continue creating opportunities for consumers to engage with photography and go beyond capturing images. The company is betting big on growing its photo printing business, especially through weddings, family functions, international travel and domestic tourism. “We’ll be expanding the consumer market by creating new media,” says Bharadwaj.
Discovering that women made up 29 per cent of its registered user base of 50,000, Canon sees a new growth segment for its DSLRs. It will continue to promote its brand of photography through its EOS Academy, currently present in seven locations including Mumbai, New Delhi, Kolkata and Bangalore.
Admitting to a tough 2013, with a 12 per cent fall in compact camera sales, the company has deftly trained its focus on mid- to high-end interchangeable lens cameras and DSLRs.
Opting to offer higher-end features that raise the cost of compact devices but remain true to the brand’s value proposition, the company looks forward to welcoming converts to DSLRs.
Having proved itself on the value-for-price promise in India, Canon India underlines that middle-income groups form its backbone.
“In Japan, 2-3 cameras per household is nothing special. Household penetration of the camera is still only about 1 per cent in India compared to Japan’s 300 per cent. We’re expecting that about 4.4 million households here will be able to afford a camera each year by 2016,” declares Kobayashi.