Eastman Kodak
Essay by review • March 23, 2011 • Research Paper • 1,031 Words (5 Pages) • 1,755 Views
EXTERNAL ENVIRONMENT
A. Societal Environment
Economy
* Economic influence of 9-11 (T)
* Theme parks, lodging, advertising, entertainment down (T)
* U.S. economic downturn (T)
* Less disposable income (T)
* Consumers dropped brands for private labels (T)
* Advertising decrease = lower film sales
* Strong U.S. dollar (T)
* Exchange rates neg. impact sales & profits (O/T)
* Gradual return to previous spending habits (O)
2. Technology
* Developing/emerging markets continue to use film (O)
* Change to digital imaging (O/T)
* Digital substitution more rapid in Japan (T/O)
* Demand for digital cameras increasing (O/T)
* 62% believe innovation/digital processing key to growth (O)
* 76% believe digital difficult to use (O)
* Not all consumers comfortable with downloading and printing on their own(T)
* Getting good prints from digital confusing, complicated, expensive (T)
* Info-imaging increase 9-10% in 2001 (O/T)
* Info-imaging $768B by 2010 (O)
* Trend to converge image & information technology (O)
* Improving infrastructure of internet (O)
* Rapid transfer of files(O)
* Internet appliances (O)
* Growth of broadband and wireless capacity (O)
* Development of digital storage technology (O)
* PIMA establishes picture transfer protocol (O)
* Pictures now down-loaded and printed immediately (T)
* Inkjet printers improved image quality (T)
* CPX standardized languages to relay picture data (O)
* PC software companies control consumer access to photos (T)
* Photo retailers going to digital mini-labs (O)
* Internet photo finishing with personalized service (O)
3. Political-Legal
* Strikes in entertainment industry (T)
* Movie film sales (O)
* E.P.A. (T)
* Designated as Partially Responsible Party
* New York Corrective Action Program
* Clean Air Act
* Department of Justice (T)
* Legal actions from violations
* Protection of intellectual property (T)
* Enforcement of licensing agreements (T)
* Implementation of EURO (O & T)
* Downward price pressures (no price variations)
* Reduces exchange/hedging costs
* Expand European mail order & e-commerce
* Value Added Taxes (O & T)
* Foreign Income taxes (T)
1. Socio-Cultural
* Digital increases overall interest in photography (T & O)
* Gen X entering family formation years (O)
* 45mm; 17% of population
* Lack brand loyalty: like trendy, sleek, state of art
* Gen Y (O)
* Adept at internet
* Lack brand loyalty: like trendy, sleek, state of art
* 41 million in U.S. population 50-59 years of age(boomers) by 2010(O)
* Leisure spending
* Echo boom (O)
* 71 mm; 25% of population
B. Task Environment
1. Threat of new entrants: MEDIUM
* Intense competition (mature)
* Few competitors in film
* Fuji - strong in digital development
* High capital commitment
* Brand recognition of current players
* All global players
* Requires high R & D investment
* Health market is seeing new competition
2. Bargaining power of buyers: HIGH
* Intense competition
* Prices in segment being driven down
* Spending on film is disappearing
* Shrinking distribution channels
* K-Mart collapse, conservative ordering patterns
* Shift to mass merchants
* Consumers demand 24/7 availability
* Profit margins for film developers is dropping
* Consolidation of group purchasing organizations
3. Threat of substitute products: HIGH
* No one company has more than 6% share of info-imaging
* Consumers adapting well to digital cameras
* Sony, Canon, Olympus, Nikon.
* Prices on digital cameras dropping
* Grow to 20mm units by 2004
* Digital penetrated 15% of households
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