1. What are the reasons for Kodak’s market share loss? Assess the effect of Fuji, Polaroid and private label brands on this market share loss.
Kodak and Fuji both sell branded products, films, cameras and other imaging products .Fuji, being closest competitor, rapidly increasing its market share by employing smart marketing strategies combined with low pricing.
Polaroid's branded product is sourced from 3M.
Kodak’s market share fell from 76% to 70% over 5 years due to lower pricing strategy employed by their competitors, Fuji and Konica. Low 3% growth rate compared to an impressive 15% Fuji & Polaroid and 10% private labels.
2. Discuss consumer behavior in the film market. At a minimum comment on product classification (e.g. convenience, shopping, specialty, unsought), internal and external factors influencing purchasing behavior, important consumer segments, and price elasticity. How has consumer behavior contributed to Kodak’s market share loss?
Because the film market has few differences between brands, and there is low involvement, so the consumer behavior of the film market should be Habitual buying behavior. In this situation, consumers will buy the products according to their habits and the film’s price.
Typically, a consumer paid between $2.50 and $3.50 for a 24 exposure roll. A significant portion of the US sales (32%) is through discount stores and department stores where price brands are predominantly sold
Consumers tend to view film as a commodity, often buying on price alone. And there are many competitors in the film market. They provide little different films to the consumers. So we can say the film market is monopolistic competition. The price elasticity of consumers in the monopolistic competition is very high.
Because the price of Kodak’s product set at high level, when new competitors entry the market with lower price, and there is no significant different among the films, consumers will choice the new...