Marketing Project

DSLR Camera Brands in India

Contents

Pg.

1. Terms Of Reference
2. Executive Summary
3. Canon India
Sony India
4. Comparative Analysis

1
2
3
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.

2. Executive Summary

Page | 1

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.

Page | 2

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.
Canons 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. Canons 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. Canons

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
Page | 3

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. Oc distributors in India will
now be a part of Canon partner network. Canons service reach extends to over 200
towns with over 200 service Engineers, 4 Master service centers and 34 Canon Care
Centers. Canon and Oc 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

Page | 4

Canon India closed

revenues at Rs. 1257 cr
revenues in 2010, with 50
per cent growth over
2009.

Canon organized over 75

photography workshops
across India.

Announces the launch of

Canon image RUNNER
ADVANCE, the nextgeneration print
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.

3.3 Recent
Marketing Strategies
o Canon enters cinematography imaging domain in India 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 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 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. Canons 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 Canons 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.

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.

The president and CEO of Canons 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 Indias spirits are buoyant. Going forward, two product categories digicams and projectors will be the prime focus areas for Canons consumer
strategy. These product categories are vital for it to scale its operations from
business communications or automation to IT peripherals to consumer products.
Its 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

4. NIKON

4.1 Overview
By capitalizing on the younger generations 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
customers prestige and recognition in a variety of fields. The majority of recent
Pulitzer Prizewinning 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
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, Alzheimers, cancer, in-vitro fertilization, and genetic
research. The Nikon Diaphot microscope was used for the countrys 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 Nikons 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 Nikons various photographic target
markets, and used for all branding and promotional pieces. Similarly, Nikons
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 Nikons 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
Nikon brand and broaden the companys reach in the marketplace. Nikons Web
sites, publications, videos, Nikon School classes, and the Nikon Spirit Initiative
are all dedicated to providing information, inspiration, and support. Nikons
educational programs and development initiatives help differentiate Nikon from
its competitors and underscore the companys 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 Nikons 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

Four Nikon products
receive the "red
dot award: product
design 2012"

(sales and marketing) Sajjan Kumar.

o Nikon is aiming to increase its market share in
India to 15 per cent this fiscal.

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,

4.7 Mission

Roorkee, Agra, Dehra Dun

and Bhubaneswar.

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

5. SONY
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

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
India Global sales ranking (As
Single Country)

FY10

FY11

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 consumers 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.

FY12
(Est.)
5

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

Service
Network

5.5.2

FY09

FY10

FY11

FY12 (Est.)

4,400

6,300

10,400

12,200

Service Operation Enhancement:

Customer Centricity is part of Sonys 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 Sonys excellent
service quality provided to its customer.

5.5.3

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

Investment Amt Rs. 250 crore

FY10

FY11

Rs. 350 crore

Rs. 360 crore

5.5.4
Sony India has a very
favorable presence over the
digital domain as well and
the website
(www.sony.co.in) is a ready

FY12
Rs. 450
crore

Local Talent Development

Developing local Indian talent is a very crucial element

of Sonys growth story in India. Sony plans to increase its
manpower by 500 employees in FY12, to match the
growing business requirement.

reckoner for product

As per a survey conducted by Tower Watson across Sony

information, retail outlets

Group companies, when compared to other high

and help guide and tutorials

technology companies in India, Sony India has the

for product usage. It

highest score based on parameters such as Talent

receives very heavy traffic

Management, Innovation, Collaboration, Empowerment,

throughout the year, with

Leadership, Values & Objectives etc.

about 3 crore visit in FY11

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

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.

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.

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 isnt 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.
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 its 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.

PEST Analysis
COMPANI
ES

POLITIC
AL

ECONOMIC

SOCIAL

TECHNOLOG
ICAL

Canon

No govt.
grant

Trading agreements to
ease shipment cost
and taxes on
importing DSLR
cameras will reduce
cost for consumers.

Most favored
brand and 2nd
highest brand
equity after
Sony.

High R&D
from parent
company.

Comparatively higher
and steady growth
rate.

Preferred by
most new age
professionals.

High consumer
confidence.

Has changed
according to
lifestyle
changes.

Competitive cost,
comparative to Nikon
but on higher side.

Highly
aggressive
policy.

Focus on
marketing by
making
quality
product.
Product life
cycles same
as Nikon.
Rate of
technology
transfer from
Int. market is
instant.

User friendly,
helps beat
Complicated
device

Nikon

Nikon
School

Trading agreements to
ease shipment cost
and taxes on
importing DSLR
cameras will reduce
cost for consumers.
Increasing growth
rate

Second most
favored brand in
SLR and over all
the loyalty is
high.
Preferred by
professionals
with non DSLR
background.

High R&D
from parent
company.
Focus on
selling what
they
manufacture.
Product life
cycles same

High consumer
confidence.
Competitive cost,
comparative to Canon
but lower.

Has changed
according to
lifestyle
changes.

as Canon.
Rate of
technology
transfer from
Int. market is
instant.
Meant for
professionals,
less user
friendly, less
outreach to
general
population.

Sony

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 the highest

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

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.

Figure 1

6.2.2 Market analysis

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 Canons competitive analysis
relating to the five different forces (see figure 2)

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 Canons
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.

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 Nikons 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).
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.
Let's now look at the Nikon D60. Theres 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 doesnt 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:
www.dpreview.com

blog.kamerakevin.com

www.letsgodigital.org

www.oppapers.com

www.andhranews.net

www.canon.co.in

www.businesswireindia.com

www.nikon.co.uk

www.itnews4you.com

www.johnnosta.com

articles.economictimes.indiatimes.com

en.wikipedia.org

www.newsduniyaonline.com

www.sony.co.in

www.cipa.jp

Images and Data search: www.google.co.in