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Marketing Project DSLR Camera Brands in India

Contents 1. Terms Of Reference 2. Executive Summary 3. Canon India 4. Nikon India 5. Sony India 6. Comparative Analysis Pg. 1 2 3 8 12 18

1. Terms of Reference
For the preparation of a DSLR Camera Brands Assessment Report for activities associated within India. Date: July 2012 Prepared for: Somaiya Institute of Management Studies & Research Prepared by: Ankit Mehta

Background and Objective There is no doubt that Canon and Nikon are the two most famous camera brands in India. These brands are famous for their Digital Single Lens Reflex (SLR) cameras because they were the first ones to make the switch from film to digital. They constantly battle against each other for the title of the best SLR manufacturer in the world. This report tries to 1. To document the significant areas within which the companies‘ activity occur, including specific values that may be affected. 2. To identify the potential effects (both favorable and adverse) on the values and factors of the proposed activities.

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2. Executive Summary
Canon and Nikon constantly produce new cameras and it is difficult to tell which one is better. All DSLRs may look alike at first glance, but each carries its own advantages and disadvantages. Consumers DSLRs can be categorized into three types- Entry Level, Intermediate and Prosumer. Canon and Nikon have the highest market share, with Sony and Fujifilm still trying to penetrate the minds of the consumers‘ mind. Sony certainly has the technology to be a player in the DSLR marketplace. And they have a natural migration path from non-DSLR consumer cameras they currently sell. And they sell a lot of them.

I doubt they'll be a serious player in the Prosumer or professional marketplace because, despite the Sony/Konica/Minolta optical marriage, the big players will continue to be Canon and Nikon who not only have the optics; they also have outstanding digital technology.

But Sony should play a major role at the DSLR entry level. They have economies-of-scale that should allow them to put a pretty competent product in the marketplace at a very competitive price.

At the moment, I don't see any one company that can compete with Canon/Nikon at the top of the professional DSLR heap. As long as they continue to lead the market in technology and continue to refine their lenses to keep up with the resolution advances in chips and processors.

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3. Journey of Canon
3.1 Company Profile: Canon Inc. (NYSE: CAJ), headquartered in Tokyo, Japan, is a leader in the fields of professional and consumer imaging equipment and information systems. Canon‘s extensive range of products includes copying machines, inkjet and laser printers, cameras, video equipment, medical equipment and semiconductormanufacturing equipment. Originally established in 1937 as Precision Optical Industry, Co., Ltd., a camera manufacturer, Canon has successfully diversified and globalized to become a worldwide industry leader in professional and consumer imaging systems and solutions. With over 195,000 employees worldwide, Canon has manufacturing and marketing subsidiaries in Japan, the Americas, Europe, Asia and Oceania; and a global R&D network with companies based in the United States, Europe, Asia and Australia. Canon‘s consolidated net sales for fiscal 2011 (ended December 31, 2011) totaled $46 billion.

3.2 Canon in India Canon India closed the year of 2011 with revenues of Rs.1525 cr and is targeting Rs. 2100 cr in 2012 which is 40% growth over 2011. Canon focuses on multiple market segments of consumer, B2B, Government & Commercial. Canon‘s product portfolio extends over a vast variety of copier MFDs, fax-machines, printers, scanners, All-in-ones, digital cameras, camcorders and multimedia projectors, cable ID printers, semiconductors and card printers. Canon India Pvt. Ltd. is a 100% subsidiary of Canon Singapore Pvt. Ltd., a world leader in imaging technologies. Set up in 1997, Canon India markets over 140
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comprehensive range of sophisticated contemporary digital imaging. Today, Canon India is certified for ISO 9001, ISO 14001 and OHSAS 18001. The company today has offices in 7 cities, warehouses in 13 cities across India and employs over 930 people. Canon has approximately 380 primary channel partners 13 National Retail Chain partners, and over 4000 secondary retail points. Océ distributors in India will now be a part of Canon partner network. Canon‘s service reach extends to over 200 towns with over 200 service Engineers, 4 Master service centers and 34 Canon Care Centers. Canon and Océ products are available with complete service support network. 1. 2. 3. 4. 5. 6. 7. 8. 9. 10. 11. 12. Products and Services: DSLRs (EF lenses, EOF cameras) Professional camcorders Compact cameras (ixus, Power Shot) Compact photo printers (SELPHY) Personal camcorders (LEGRIA) Fax machines (Inkjet, Laser) Single function printers (inkjet-pixma, laser-laser shoot) Multifunction printers (inkjet-pixma, laser-image CLASS) Scanners (document, flatbed, flatbed with film) Consumables (ink, paper & media) Projectors

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3.3 Recent Marketing Strategies o Canon enters cinematography imaging domain in India Canon India closed revenues at Rs. 1257 cr revenues in 2010, with 50 per cent growth over 2009. in July 2012. Targets Bollywood and broadcast applications with new cinema EOS product line. o Announces 3 models as a part of new range of advanced professional cameras and 11 new lenses for cinema photography image capturing o Launches Canon Professional Services ( CPS ) for press and media photographers in the country. The service will Canon organized over 75 photography workshops across India. provide membership for selected media houses (company membership) targeting the regions of Mumbai, Delhi. CPS concept has been established in worldwide Canon group and herein starts with Indian market. This CPS concept starts with selected Press Media and will expand to professional photographers and Announces the launch of Canon image RUNNER ADVANCE, the nextgeneration print Professional camcorder user including Cinema EOS System. o Canon plans to inaugurate 95 retail stores in 2011, 100 in the year 2012 and another 100 stores in 2013 taking the count to 300 stores in the next 3 years. Canon‘s unique initiative to tap B, C and D-class cities of the country, Image Express, reached 38 cities in Tier II and Tier III towns. o Canon India forayed into retail space with the launch of its exclusive brand retail store called "Canon Image Square". o Canon launched Canon Image Express, a mobile campaign touching 32 cities in 224 days o Canon launched a television commercial called My IXUS, My Style in two languages, English and Malayalam. o Canon‘s Original Ink Centers touched 1000 outlets across 176 cities in India. o Pioneer of 100% cash back offer on laser printers under CLAP, Canon Loyalty Achievement Program.

architecture platform that
will revolutionize the printing industry. Canon also announces their alliance with the leading software solutions provider, Microsoft India to create the ultimate document management office.

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3.4 Awards       ―Strong commitment to excel" at the CII-EXIM Business Excellence Award Canon was ranked amongst top 10 employers in India in the Business Today ‗Best Companies to Work for in India‘ in 2009. Manufacturer of the Year-Smart Photography 2010 Best Camera Company of the Year-Smart Photography 2010 Best Printer Company of the Year: Inkjet-Smart Photography 2010 Best Professional Printer of the Year-Asian Photography 2010

3.5 Vision Simple advanced solutions freeing people to live their dreams and lead enriched lives at home and at work. 3.6 Mission Canon Australia and New Zealand are market leading suppliers of consumer and business imaging solutions. We are a Canon Oceanic a team committed to our customers‘ ongoing satisfaction through the empowerment and development of our staff. To be the preferred supplier we will be easy to deal with and provide quality, value for money products and services. To ensure success for all stake holders we will deliver profitability, growth, job fulfillment and have a positive impact on the community.

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The president and CEO of Canon‘s South East Asia regional headquarter Singapore, Fukui Eiji, is confident that India is going to be an important market for Canon. With the upcoming launch of products, its distribution strategy in place, cross-selling opportunities in digital cameras, and competitive pricing, Canon India‘s spirits are buoyant. Going forward, two product categories – digicams and projectors – will be the prime focus areas for Canon‘s consumer strategy. These product categories are vital for it to scale its operations from business communications or automation to IT peripherals to consumer products. ―It‘s a big change for Canon,‖ says Alok Bharadwaj, Director and GM, Consumer Imaging & Information Division. 3.7 Summary Canon continues to remain motivated and responsive in their pursuit of growth. Canon sees India as a critical market for its overall growth and is focused on deepening their relationship while staying committed to realizing the untapped potential in the market. With Canon camera business growing at a fast pace of 60% in India in 2012, Canon is looking forward to transform the industry with their new products. In accordance with this growth strategy , cinematography is a new domain that Canon will focus on , to consolidate its leadership in the Indian camera market and expects it to contribute 5% towards its top line in 2013. Next time you go to watch a Bollywood movie and get impressed with a scene, just think of Canon." Dr. Alok Bharadwaj, Senior Vice President, Canon India

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4.1 Overview By capitalizing on the younger generation‘s technological knowledge and creative potential, Nikon hopes to increase its market share in the DSLR photography sector in India. The DSLR market is known to attract a slightly more matured and affluent crowd and the camera are usually perceived as complicated and difficult to use. To engage the younger audience and debunk the misconceptions, Nikon has produced a guide menu to teach consumers to take great pictures quickly. The advantages marketing the DSLR photography interest to the youth in India: o Debunk the misconception of DLSR photography is only for the older generation. o Increase market share in the DSLR photography sector. o Promote creative photography among students. 4.2 Business Mission Become a recognized branding for DSLR photography among the youth by promoting affordable, user friendly and creative DSLR photography. 4.3 Achievements Nikon has led in technical innovations for more than 85 years, and the performance delivered by Nikon products has earned the company and its customer‘s prestige and recognition in a variety of fields. The majority of recent Pulitzer Prize–winning photographers used Nikon equipment to capture the winning image. Nikon Coolpix cameras have received more awards and top rankings than any other consumer digital camera line. Plus, Nikon SLR cameras
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have been on every manned space flight since the Apollo 15 mission in 1971. As ―The Eyes of Science,‖ Nikon microscopes enable researchers to make critical breakthroughs, and Nikon instruments have been at the forefront of discoveries in such areas as AIDS, Alzheimer‘s, cancer, in-vitro fertilization, and genetic research. The Nikon Diaphot microscope was used for the country‘s first in-vitro birth, and is still the predominant microscope for assisted reproduction. Additionally, a Nikon microscope was used in the cloning process for Dolly the Sheep, the first successful fully grown mammal clone. The tradition of Nikon quality pervades the company, extending beyond the excellence of its products. For the third consecutive year, Nikon has earned the distinct honor of receiving the National Association of Photo Equipment Technicians Manufacturer Service Support Award — the highest honor for consistent quality service within the industry.

4.4 Promotion Pictures are an integral part of our lives, and Nikon has always known that ultimately it is the photograph that matters most. Perhaps the picture matters for creative expression and personal fulfillment. Perhaps it matters for income derived from images, or simply for pleasure and shared memories. The unsurpassed quality and reliability that result from Nikon‘s dedication to excellence assure that Nikon equipment is exactly what you need when the picture matters, which is always. For this reason, the company has adopted the platform “If the Picture Matters the Camera Matters™.” This philosophy, or key selling idea, has been crafted to address Nikon‘s various photographic target markets, and used for all branding and promotional pieces. Similarly, Nikon‘s industrial, bioscience, and other products employ direct benefit messages to their target audiences in their promotions. For instance, Nikon Microscopes‘ positioning as the “Eyes of Science” highlights Nikon‘s dedication to providing the scientific community with the technology that enables vision and discovery. Based on a longstanding philosophy that education is as much a part of the Nikon tradition as the development and quality of products, Nikon has developed a comprehensive program of educational tools and online programs that extend the
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Nikon brand and broaden the company‘s reach in the marketplace. Nikon‘s Web sites, publications, videos, Nikon School classes, and the Nikon Spirit Initiative are all dedicated to providing information, inspiration, and support. Nikon‘s educational programs and development initiatives help differentiate Nikon from its competitors and underscore the company‘s commitment to quality.

4.5 BRAND VALUES The Nikon name is equated with extraordinary performance, innovation, precision, and optical quality. The Nikon brand is a well-earned, valued asset — an asset that Nikon will continue to invest in by pursuing continual innovation in all business activities, from product planning, design, and development to production, marketing, customer support, and services. The unique strength of the Nikon brand comes from the determination to deliver quality that customers can trust. Nikon is always at the Heart of the Image.

4.6 Strategic objectives o ―Since, Japan and China contribute 10 per cent each to Nikon‘s revenues, we are targeting 5 per cent revenues from India in the next 3 years as it has a lot of potential given its size and current growth,‖ Nikon India managing director Hiroshi Takashina told Business Standard. o Mr. Tanaka (ex MD) said Nikon would soon launch an aggressive campaign to capture the fast-growing camera market in India. Nikon was aiming a 45 per cent market share in the SLR market, which stands at around 17,000 units a year. ―Today we have only 10 Nikon Touch Zones in four metros, which would be increased to 40 by the end of this year. We also hope to maintain a growth rate of 35 per cent,‖ he added. o Besides, the company is aiming to increase its dealer network to 1,800 from 1,250 at present. ―We are now focusing on tier II and III cities for growth as the in smaller centers is more than metros and bigger cities, although the numbers are still small,‖ Nikon GM (sales and marketing) Sajjan Kumar.
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Nikon is aiming to increase its market share in

India to 15 per cent this fiscal.
Four Nikon products receive the "red dot award: product design 2012"

Nikon has set up more than 40 D-SLR and COOLPIX

zone in India in cities like
Mumbai, Delhi, Bangalore, Pune, Hyderabad, Kolkata, Coimbatore, Ahmedabad, Roorkee, Agra, Dehra Dun and Bhubaneswar. 4.7 Mission Performance levels to be achieved on priority issues, such as cost reduction Measures of success in fulfilling critical mission statement elements, such as "delivering superior customer service "Expected performance in key result areas (those additional areas in which you must get measurable results if you are to succeed), including: Expected financial performance standards such as profitability, sales revenue, growth, and cost/expense levels Targets for performance on strategic measures that drive future financial performance, such as market share, customer-perceived quality and service, employee satisfaction, organization skills and succession, and innovation

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5.1 Overview Mr. Kenichiro Hibi appointed as Managing Director, Sony India with effect from July 1, 2012. Sony India achieved sales of Rs. 6,313 crore in FY11 and aims 30% growth in sales in FY12. India to be 5th Largest Contributor to global sales by FY12.

5.2 Category Performance

BRAVIA is No.1 in Flat Panel Market with 18.8% share (In Qty.) in CY11(As

per Display Search)

Cyber-shot is No.1 in Compact Digital Camera market with 34% share in

FY11 (As per Import Data)

VAIO for the first time hit No.1 share of 20% in Q4, 2011 (As per IDC

Report) 5.3 Plan in India
   

Enhance existing distribution network from 10,400 in FY11 to 12,200 in FY12 Boost after-sales service with 285 service touch points across India in FY12 Allocate marketing budget of Rs. 450 crore in FY12 Plan headcount increase by 500, to take the total no. to 3,800 in FY12

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BRAVIA, VAIO and Digital Imaging (Cyber-shot, Handy-cam, Alpha & Photo Frame) have been the growth drivers of the business in India, contributing 35%, 20% and 15%, respectively to the total sales in FY11.

Time period



FY12 (Est.)

India Global sales ranking (As Single Country)




Cyber-shot™ With Cyber-shot, Sony retains its No.1 position in Compact Digital Camera market with an unbeatable market share of 34% (In Qty.) in FY11 (As per Import Data), which is much ahead of the nearest competitor. In FY11, Sony sold 11 lakh Cyber-shot cameras, which is expected to go up to 14 lakh units by end of FY12. Not only this, Handy-cam has approximately 90% share of the camcorder market, and Sony is the only player to drive this market in India. 5.4 Brand Equity As per Customer Equity Tracking Study done by Nielsen in March 2012, Sony has been ranked as the No. 1 brand that comes to consumer‘s mind, when prompted with the word ‗General Electronics‘. Not only this, Sony obtained highest satisfaction scores with the biggest gap noted for Retail Price Stability, from the competition. This is a result of our Dealer Satisfaction Study done by Nielsen, where selected dealers were asked to give an overall satisfaction rating from a scale of 1 to 10 for each company.

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5.5 Business Strategy To strengthen its business operation, Sony India follows its core business strategy, comprising of the following strong pillars: 5.5.1 Sales Channel Expansion: Sony has its footprint across all major towns and cities in the India through a very wide distribution network. Currently Sony has 10,400 sales channels including brand shops, national chain stores and distributors. Sony plans to aggressively increase the network to 12,200 channels by FY12.

Time period




FY12 (Est.)

Service Network






Service Operation Enhancement: Customer Centricity is part of Sony‘s DNA. Over the years, customer

service has evolved from just repairs to providing fast, flexible, affordable and comprehensive solutions to customers. Sony currently has 255 conveniently located service touch-points, which it plans to step-up to 285 by FY12 As per a survey done by Nielsen on Dealer Satisfaction, Sony has gained No. 1 position for after sales support, which is a reflection of Sony‘s excellent service quality provided to its customer.

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Aggressive Brand Promotion Sony followed a strong brand promotion strategy and invested Rs. 360

crore in FY11. All the brand campaigns were supported with extensive Abovethe-line and Below-the-line activities, including print and television commercial, Web, PR, cinema and shop-front. In FY12, Sony plans to pump up an investment of Rs. 450 crore, which will be in sync with the business growth. Time period FY09 FY10 FY11 FY12 Rs. 450 crore

Investment Amt Rs. 250 crore

Rs. 350 crore

Rs. 360 crore

Sony India has a very favorable presence over the digital domain as well and


Local Talent Development

Developing local Indian talent is a very crucial element of Sony‘s growth story in India. Sony plans to increase its manpower by 500 employees in FY12, to match the growing business requirement. As per a survey conducted by Tower Watson across Sony Group companies, when compared to other high technology companies in India, Sony India has the highest score based on parameters such as Talent Management, Innovation, Collaboration, Empowerment, Leadership, Values & Objectives etc. Sony India also has a very low attrition rate, which is again a testimony to the fact that employees are comfortable with the work environment. While vacancies are quickly replenished with fresh talent, Sony India works towards creating a strong career development programme for existing employees which helps limit the attrition. This includes various Sony University programmes that staffs have the opportunity to participate in.

the website
( is a ready reckoner for product information, retail outlets and help guide and tutorials for product usage. It receives very heavy traffic throughout the year, with about 3 crore visit in FY11

alone. Sony‘s Facebook
page has more than 6.5 lakh fans and over 5 lakh channel views on YouTube.

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5.6 Outlook for FY12 Sony plans to increase its sales turnover by 30% in FY12 5.6.1 Cybershot

Sony Cyber-shot grew 45% (Qty.) in FY11, higher than the digital still camera industry growth rate of 40% (Qty.)

Plans to sell 14 lakh (Qty.) units in FY12 as compared to 11 lakh (Qty.) units in FY11

Introduces 34 new Cyber-shot models with at least 16 models with High Zoom feature.

Allocates Rs.50 crore to promote ‗incredible zoom. incredible details‘ campaign with Brand Ambassador, Ms. Deepika Padukone.

Expands channel network to 3,000 in FY12, up from 2,500 outlets in FY11.

5.7 Distribution Sony believes a robust distribution network is essential to the growth and sales of Cyber-shot cameras and hence plans to strengthen its current channel base to 3,000 counters in FY12, up from 2,500 counters in FY11. The current 2,500 outlets are distributed amongst 300 Brand Shops, 1,200 Photo stores and 1,000 consumer electronic stores including National Retailers. Distribution Sony being the company which positions itself as a seller of durable and high-end products, it is practicing selective distribution of its products from these elective dealers i.e. SONY-World. Apart from this there are grey-markets in India and other countries where a practice of intensive market coverage is practiced, and the products in these kind of markets normally do not possess all the features and benefits which Sony offers e.g. warranty and guarantee. Sony distributes its products in various channels. It uses Zero-level channel, one level channel and two-level channel. In India, Sony has used the method of one-level distribution channel. This means that, customer buys their Sony product from the retailers recognized by Sony, and these retailers buy the products directly from the company itself.

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5.8 Advertising Sony incorporates co-operative advertising in its advertising process. Sony Corporation provides the dealers (e.g. Sony World) with the materials and guidelines to develop ads for print, television or radio commercials. This ensures that message is in line with, what the manufacture wants to communicate. The company and the dealers usually share the media costs and hence, the name ‗cooperative advertising‘. 5.9 Awards      No. 1 Ranking Camera for 2010 by Cnet Asia's Top 10 Cameras of 2010 Best Imaging Innovation: Sony SLT, Translucent Mirror Technology The 50 Best Inventions of the Year Award DPREVIEW Gold Award 2010 Camera of the Year

5.10 Summary There isn‘t a wide range of products available under Alpha series, but what makes photography fun and stylish for the youngsters is the ease of software and auto settings. The new Cyber-shot range will be available from Rs. 5,490 to Rs.27,990 at Sony Center, photo channel outlets, consumer electronic stores and leading national retailers across the country. Sony is also set to launch its multi-media brand campaign across India, touching upon various media vehicles such as Television and Print commercial, shop-front, PR and web activities. Featuring Brand Ambassador Ms. Deepika Padukone, the „incredible zoom. incredible details‟ commercial oozes a carnival feel.
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6. Comparative Analysis 6.1 Pros and Cons  One Big difference between the companies is the lenses. Nikon is not completely backward compatible with the previous Nikon lenses whereas the Canon cameras are and they are even compatible with third party lenses. Sony on the other hand has limited backward compatibility issues because it‘s fairly new in the market and almost all the lenses are not manufactured by it, because they have partnership with Carl Zeiss.  So how does the difference impact consumers and brand? If in the future one wants to buy a specialty lens, he only has limited options with Nikon, with comparatively higher prices. On the other hand, with the Canon one can get any Canon lenses or buy third party ones which are usually less expensive.  Prosumers is short for ―Professional Consumers‖ and they are intended for advanced amateurs. One thing that distinguishes this camera from the other is their speed. Most SLRs are able to capture 3 consecutive photos per second, but Prosumers can take up to 21 photos per second. Here Nikon beats the race with 21fps camera.

6.2 External Marketing Audit 6.2.1 Macro environment In this section we shall analyse the macro environment of India in order for Nikon to penetrate the DSLR market. Wilson, A (2002) has suggested that ―what is frequently lacking is an understanding of what might be termed the ‗outer environment‘, where four major forces of change are at work.‖ These are namely the political/government activities, economic change, sociological change and technological change. The acronym ‗PEST‘ is fondly used to describe these factors. Figure 1: The ―PEST‖ Diagram Adapted from ―The Marketing Audit‖ Wilson 2002.

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PEST Analysis
COMPANIES Canon POLITICAL No govt. grant ECONOMIC SOCIAL Most favored brand and 2nd highest brand equity after Sony. Preferred by most new age professionals. Has changed according to lifestyle changes. Highly aggressive policy. TECHNOLOGICAL High R&D from parent company. Focus on marketing by making quality product. Product life cycles same as Nikon. Rate of technology transfer from Int. market is instant.

Trading agreements to ease shipment cost and taxes on importing DSLR cameras will reduce cost for consumers. Comparatively higher and steady growth rate. High consumer confidence. Competitive cost, comparative to Nikon but on higher side.

User friendly, helps beat ―Complicated device‖


Nikon School

Trading agreements to ease shipment cost and taxes on importing DSLR cameras will reduce cost for consumers. Increasing growth rate High consumer confidence. Competitive cost, comparative to Canon but lower.

Second most favored brand in SLR and over all the loyalty is high. Preferred by professionals with non DSLR background. Has changed according to lifestyle changes.

High R&D from parent company. Focus on selling what they manufacture. Product life cycles same as Canon. Rate of technology transfer from Int. market is instant. Meant for professionals, less user friendly, less outreach to general population.

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No govt. grant

Trading agreements to ease shipment cost and taxes on importing DSLR cameras will reduce cost for consumers Competitive cost.
Economic growth rate satisfactory. Very low attrition rate Consumer confidence not that high.

Has started to capture Youth, with

High R&D from parent company. Focus on selling what they manufacture. Product life cycles not the same as Industry standard. Rate of technology transfer from Int. market is satisfactory. User friendly, general population approving it, but not at all by the professionals.

the highest brand equity in consumer market.
Preferred by amateurs. Has started with the current lifestyle.

Figure 1

6.2.2 Market analysis

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Sony: All is going according to plan; sales will grow slowly but steadily as the product is progressively introduced to the market. Nikon: Profits which Nikon makes are non-existent at this stage because of the costs of introducing the product; promotional costs are high in proportion to sales, and costs per unit of output are high because of low volume, but also have adding new functions, creating new market segments, therefore between stage1 and 2. Canon: The expansion of the market attracts new competitors who have various market-penetration strategies such as adding new functions, creating new market segments, and capitalizing on distribution channels, the price down, and so on, thus Profits may increase in this stage in accordance with the expansion of sales volume. 6.2.3 Competition Porter's (1985) ‗Five Forces' model has been most widely used in the strategic analysis of competition. We shall use this model for Canon‘s competitive analysis relating to the five different forces (see figure 2)

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1. New entrants: threat of entry from other organizations. (Example: Samsung and Sony entering the DSLR market. They currently have a share in the compact digital camera markets only.) 2. Substitutes: availability and competition from substitute products. (Example: Mobile phones and video cameras which can match the DSLR technology in photography.) 3. Buyers: bargaining power of buyers. (Example: Distributors are able to increase sales by providing convenient and reliable services, built on Canon‘s Image Square.) 4. Suppliers: bargaining power of suppliers. (Example: Trained specialist and advance equipment required by Canon India to meet increasing demands.) 5. Existing competitors: rivalry among existing competitors. (Example: Nikon and Olympus jockeying for position in the youth DSLR market.)

6.3 Strategic Issues Analysis Despite there being no anticipation of any significant decline in consumption in the digital camera market, we expect consumer behavior and exchange rates will remain unclear in future and that intensification of competition with competitors and downward product price trend will continue. The Nikon Group is committed to strengthening its manufacturing competitiveness constantly to meet the expectations of its customers. The entire industry is thus striving to improve competitiveness in terms of speed and cost as well as quality. In digital SLR cameras and interchangeable lenses, sales were down due to deterioration of product prices brought about by the effects of a strong yen and changes to the sales composition ratio by price range. The Company was, however, able to increase its sales volume at the same level, led by sales of their new models.

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6.4 SWOT Analysis Strengths Increasing profits Nikon's camera business seems to have racked up an operating profit of about 23.5 billion yen in the half, compared with a 1.9 billion loss in the year-ago period. Sales of digital SLR cameras rose more than 10% to break above 1.9million units thanks to the popularity of the entry-level D3100 and D5000. Nikon has continued to improve its corporate makeup, with a balanced increase to high dimensions for all corporate functions, including marketing, development and design, production, and sales. They currently employ a structure that allows them to modify production on a weekly basis to reflect the latest market data. When market conditions began to deteriorate in the fall of 2008, they decided quickly to adjust production at the end of 2008-making them the first in the industry to do so-and were one of the first to complete those adjustments. All of Nikon‘s corporate functions operating simultaneously at high levels provide a true collective strength that can be leveraged in a short period of time. Common to all: Able to provide good customer service and support due to local service center. World known and recognized brand for photography equipment.

Weaknesses Nikons marketing campaigns focuses on compact digital cameras rather than DSLR Opportunity Current economic upswing would encourage consumers to spend more on lifestyle luxury products such as DSLR cameras. Selling existing products to existing markets/ segments (market penetration).
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Extending existing products to new markets/ segments (market extension). Room for market growth as the untapped source of potential youth market with the development of media communications studies available Threats Entry of new market players in the DSLR market such as, Sony and Panasonic. Canon realizing the potential of the youth market and introduces new models with user-friendly technology for newcomers to DSLR photography. Product / Placement The consumer grade segment of the market is most vital to both companies because they account for a bulk of their revenue and thus is their bread and butter. One way to gauge the competition is to go to a store. I go to Croma frequently and chuckle whenever I see both Canon and Nikon DSLR boxes side by side. As of late 2011, the two consumer grade cameras that Croma sells are the Canon 600D and Nikon D3100. While both try to compete for similar price range, looking at the boxes, one may feel that they're actually aiming for different types of consumers!

. Look at the fancy jargons like "Optical Image Stabilizer Double Zoom Lens Kit", and below, a bunch of fancy stuff like "12.2 MEGAPIXELS", "Digic III", "3 inch LCD", "3.5 Frames per second", "EOS", "Picture Style". Wow! If I were a guy who loves to look at specifications all day, I'd get a Canon Rebel because it's obviously better on a spec-by-spec comparison.

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Let's now look at the Nikon D60. There‘s no sport. There's no emphasis on frozen action. There are no fancy jargons to woe you. There IS however lots of emphasis on people... portraits... softness... prettiness... connection to people. Nikon's strategy is about connecting to professionals in the simplest possible way. Canon's strategy is to use what they're traditionally good at: sports and specs. Canon loves to show pictures of sports, frozen in time. In addition, Canon uses higher specifications (higher megapixel, more frames per second, higher processor name, etc.) to lure certain types of buyers-- the Specification Peepers. What does that leave Nikon with? Nikon's strategy isn't to use specification to sell. Nikon doesn't need to compete on specs, because not all specs are relevant to the discerned buyer. For example, a higher megapixel doesn‘t mean better image quality (in fact, more megapixels means more noise at night). There are other things to consider, like contrast and color rendition that Nikon excels at. References: Images and Data search:

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