Digital cameras have it rough in the retail channel these days, as do retailers themselves in some regards, as both adapt to changes that connected technology brought to the way we take pictures, and the way in which we shop. Across the retail landscape, the historically vast presence of digital cameras has waned in recent years as chains progressively deemphasize the category in favor of showcasing growth areas such as “connected home,” “mobile,” and “wearables.”
Within the office super store (OSS) channel, the descent of digital camera placements has been ongoing, and as the chains themselves face challenges to maintain relevancy for shoppers, their urgency has accelerated the negative phenomenon that cameras face across the landscape. Office suppliers now provide shoppers with only a slim selection of digital cameras, and have thus far provided no indication that a turnaround is in sight for the category.
OSS Channel: Digital Camera Placements
Since 2010, digital camera placements in the OSS channel have declined 80%. Historically the channel was home to around 100 camera placements each month, but now that count is only around 20. While this macro-trend is alarming, placements in the channel as of August 2014 show a 60% drop compared to just one year prior (21 vs. 52 in Aug 2013), which illustrates an acceleration to the descent. A large reason for the category’s demise in the OSS channel is the fact that retailers historically favored low-priced novice-targeted SKUs, which have diminished in overall demand due to the popularity of smartphones.
OfficeMax, which once stocked close to 40 different camera models, was the first in the channel to test the prospect of a camera-less assortment by taking a complete hiatus from selling digital cameras during Summer 2012 (May, Jun, Jul, Aug). When cameras returned in September of that year, they were represented by only 10 placements, and a shift to sales cards left OfficeMax shoppers without any tangible interaction with the gear. Later, as Office Depot’s merger with OfficeMax moved toward completion, the latter retailer’s peg rack merchandising preferences spread onto Office Depot’s shelf, as it too shifted cameras off of an interactive gondola and onto sales cards. Staples, which once showcased upwards of 40 digital cameras in its stores, has shown no interest in the category since adding its latest models in the Fall of 2013. None of the new digital cameras brought to market in 2014 ever hit Staples stores, and the retailer’s Fall 2014 planogram removes the camera isle all together, giving a home to its boosted assortment of “fitness wearables” and “connected home” offerings.
OSS Channel: Digital Camera Print Ads
The shrinking shelf space that OSS players are providing to digital cameras is, not surprisingly, directly mirrored within the channel’s print advertising activity. Office Depot, OfficeMax, and Staples went from consistently producing combined quarterly ad totals between 150 and 200, to not advertising a single digital camera in 3Q14 (or 4Q14 to date). Since 2010, the seasonal peaks in the OSS chains’ combined Q4 advertising have grown flatter with an average 16% decline each year, which illustrates a strategy shift away from using point-and-shoots as holiday gift items.
OSS Channel: Digital Camera Brand Diversity
Once a diverse arena with opportunities for numerous brands, competition has gradually evaporated within the OSS channel, and shoppers are now met with virtually no variety in stores. Cameras are clearly no longer a priority for OSS retailers, which is not terribly surprising noting the historically low sell-rates that they have generated outside of key promotional periods.
Kodak’s withdrawal from the digital camera market greatly affected the OSS channel, as its EasyShare portfolio was a staple of the channel’s marketing, and the lineup’s novice-targeted messaging aligned well with office stores’ less-tech-savvy clientele. Well-timed seasonal SKUs previously-provided by FujiFilm helped that brand gain a wider foothold during the Spring of 2012 as a replacement for Kodak at Office Depot and Staples, although its presence would also diminish over time. By Summer 2012, Sony had abandoned the OSS channel, followed by Olympus that Winter, which mainly left Canon and Nikon to compete.
For much of 2013 Canon and Nikon battled with an apples-to-apples array of offerings on Office Depot and OfficeMax’s shelf, and would amusingly trade volleys for Sunday ad space almost every other week at the two chains. However, Nikon’s presence completely evaporated by the Summer of 2014, with the brand seemly not wanting to deal with the merging of Office Depot and OfficeMax. Now that the merger has settled, Canon is retained as the lone digital camera brand likely as a result of its broad range of imaging and office products present at Office Depot and OfficeMax.
Without any competition, Canon’s camera shelf at Office Depot and OfficeMax is somewhat stagnant, with no advertisements to drive shoppers in, and a laidback approach to the promotion of channel-wide instant savings. Canon is uniquely positioned to be the “end-to-end” imaging solution for shoppers (capture-print), but has thus far not capitalized on this strategic position with any cross-category marketing. Two cameras within Canon’s identical five-model array at Office Depot and OfficeMax boast built-in connectivity (WiFi & NFC), and would logically complement the manufacturer’s fleet of WiFi printers. This would serve to strengthen awareness and drive customer loyalty over other competitors, a solid benefit to both brand and retailer in an increasingly omni-channel world. Instead, the historically poor performance of digital cameras within the OSS channel seems to have led to very low motivations and expectations from the entities, and the camera isle remain off-the-beaten path at Office Depot and OfficeMax, simply bleeping along on life-support.