MARKETING: Where to from here?

Market consultant Mark Fletcher suggests that photo retailers take in some of the broader trends emerging in the contemporary consumer market to fine-tune their product and service offerings.

Since the advent of the digital revolution, the photo imaging industry has been at the forefront of evolving consumer desires and needs. While much of the focus of these changes has been upon the technology involved, (eg, digital cameras and home printing), there are some broad consumer trends that will increasingly impact upon product and service choices.
History has shown that those players who can effectively leverage such trends have the potential to reap rich rewards, or to at least stay in business in a rapidly changing world.
This article looks at three consumer trends that may be of particular relevance to the photo imaging industry. These are just a snapshot of a wider ranging report on tomorrow's customers ("Tomorrow's Customer is Really Blue") which details how customers are changing, the impact this change will have on products and services, how to communicate to this new customer, and how marketers can start to leverage these changes. The full report is available free at www.consultaxiom.com.
The key to taking advantage of these trends is to think laterally and innovatively.
This article provides a few potential examples that challenge some current business models and service concepts.
The reader is encouraged, however, to view these ideas simply as starting points or examples, and focus instead on how they can adapt their own business to the changing consumer.

'Premiumisation'
'Premiumisation' refers to the increasing popularity of premium or high-end options across virtually all products and services. While we tend to think of premium options as being the domain of the rich, increasingly, they are now being purchased by middle market and lower-end consumers seeking either to experience aspects of a luxury lifestyle (eg, treating themselves) or simply because they are prepared to pay to indulge their special interest or need.
For example, poster prints have long been offered by photo retailers but have never sold in high volumes. However, some parents may well pay a couple of thousand dollars to have a professional artist prepare a beautiful framed poster-sized photo collage (using the parent's photos) as a gift for a special event, such as their daughter's wedding. Such a service could easily be marketed and administered through local photo shops, who would then take a margin on the sale.
While they are never high-volume sales items, if they are well designed and professionally delivered and marketed, premium services can often find a useful and profitable niche market.

Instant Gratification
Nowadays, no one is prepared to wait. The "new" consumer will even put up with grainy, blurry, cameraphone images, all for the sake of spontaneous capturing and sharing. Similarly, one of the main reasons people print photos at home is so they can have them immediately, instead of the hassle of assembling and taking the images to a photo kiosk. Even widely successful services such as YouTube and Facebook can be seen to address instant gratification as they make it quicker and easier to both post your own images and to review your friends' images.
If this trend continues, then it is fascinating to consider what it may lead to. For example, would consumers respond to a service where with a single button click on their mobile phone, they can send their most recent camera phone image to an online store that automatically collates every 10 images that from that customer, sources the best price from a range of on-line suppliers, and gets the set of 10 images printed and posted to the consumer's home? While not instantaneous, this type of service does provide instant gratification as the customer can make a simple on-the-spot decision and then not worry about the matter any more.

Authenticity
There is no doubt that consumers are becoming increasingly sophisticated in their purchasing behaviours. Market research across a number of different retail categories has found that a significant proportion of consumers use the expertise of the sales staff at quality retailers to shortlist brands and models but will then go and buy their chosen item from a volume-based discount retailer who has less competent staff but cheaper prices. This trend is accelerating and some high end retailers are finding it increasingly difficult to compete.
When asked, these consumers say that they know the "real" price of the items, and that they are not prepared to pay anything higher than that price. Underpinning this behaviour is a consumer trend towards authenticity; literally, valuing what is genuine and not just responding to marketing hype.
If this trend continues, then some small, high-end retailers who are currently losing the price war may change the rules of the game. For example, a well established family retailer known for its expertise may decide to charge for that expertise. (Eg, "For a $20 flat fee, our highly experienced staff will help you to short-list some digital cameras that fit your particular needs. We will then offer that camera to you at a wholesale price or you can source it from wherever you want.") A similar trend is already emerging in the travel industry where some travel agents have evolved their business into a pure travel consultancy that does not handle any retail transactions.
The key to this radical concept is that the retailer stops trying to make a margin on sales, and instead, makes explicit to the consumer the value of their expertise.

The future
Unfortunately, no one knows how these trends and other will play out or what will be the new products and services that will revolutionise the photo imaging industry. The ideas in this article are intended as thought starters and not predictions. It is likely; however, that in another 10 years, we will be able to identify that whatever fantastic new products and services have emerged address the consumer desires for instant gratification, premiumisation and/or authenticity.
Based on "Tomorrow's Customer is Really Blue" by Mark Fletcher and David Schloeffel, available free at www.consultaxiom.com.
Mark Fletcher is a Director of Axiom Consulting Australia and is a leading market researcher specialising in helping bring to market new products and services. Mark conducted the recent Photo Direct survey on Australian and New Zealand consumer photo imaging behaviour.
Email: mark@consultaxiom.com
Web: www.consultaxiom.com

-- Article first published in Photo & Imaging News magazine, June/July 2008.