1, Digital Technology Ends Film Kodak
First of all, there was intense price competition from the market sector. Self-labeling (or retailer branding) depressed the price of Kodak products by 40%. Cheaper film in Eastern Europe and developing markets also posed a significant threat to Kodak, as people at lower income levels paid more attention to price than to brand and quality. Kodak has implemented a series of price counterattack strategy, once to a certain extent worked, but still can not completely remove the bad effects of the price war.
Another challenge for Kodak came from the impact of digital imaging on traditional imaging technology. High cost, bulky equipment, serious pollution is the production of negatives and photographic paper and printing process is difficult to solve the problem, the size of the large, can not be stored permanently, difficult to find is the use of negatives and photographic paper to the inconvenience caused by people.
2, hobbling strategic transition
While Kodak in 1998 began to feel the pain of the shrinking of the traditional film business, but Kodak's decision makers, due to the fear of film sales have been affected, has not dared to vigorously develop the digital business.
After 2000, the global digital market continued to grow at a rapid pace, almost tripling, while global demand for color film began to decline sharply at a rate of 10% per year.
In 2002, Kodak's digitization rate was only about 25%, while rival Fuji had reached 60%.
In 2004, Kodak launched six belated digital cameras, but profit margins were just 1 percent, while revenue from its $8.2 billion traditional business shrank 17 percent.
In 2006, Kodak sold its entire digital camera manufacturing business to Singapore's Flextronics, and in 2007 it sold its medical imaging unit, one of its four main businesses, to Canadian asset-buyer OneXyi for $2.55 billion, and in the same year transferred its stake in Luckys to Guangzhou Honest Venture Capital Co. for a bargain price of $37 million.
Since 2007, Kodak has implemented a second strategic reorganization, laying off as many as 28,000 employees, a range as high as 50%. However, in 2008, the financial crisis broke out, demand weakened, the market shrinks, its fourth quarterly report shows that Kodak loss of 133 million U.S. dollars, for the third consecutive year of annual revenue decline, by selling assets barely profitable Kodak all of a sudden back to the original shape.
Kodak's 2010 earnings report showed a loss of $58 million from continuing operations. Moreover, Kodak's main source of revenue is still the sale of patents, and new products like inkjet printers have yet to really open up the market.
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Expanded
Kodak Revealed
1, can not rely on the "brand"
A popular legend about the brand is that, if one day a fire burned down Coca-Cola, as long as the formula is still in place, it will soon be rebuilt. Coca-Cola Company. Perhaps it did; 99.61% water, carbonation, and syrup, plus 0.39% of the formula - that's Coca-Cola. The Coca-Cola brand is worth more than $68.7 billion alone in the 2008 Top 100 Global Brands by BusinessWeek and Interbrand, the world's leading brand consultancy.
Don't forget that Kodak's brand value exceeded $7.8 billion in 2003 in the same poll, but was down to just $5.2 billion in 2004, not to mention a complete outlier later on.
What was once a huge brand value is now gone. The once-great brand equity on paper has done little for Kodak's rebirth. From the first Olympic Games in 1896, Kodak began sponsoring sports events, branding through large-scale sporting events has become a traditional Kodak program. From the 1986 Olympics began the "TOP program", Kodak became the "TOP sponsor" of every Olympic Games until 2004.
Until the 2004 Athens Olympics, when Kodak began to enter a difficult period, it was still a "TOP Sponsor", but this no longer helped to save Kodak's fate.
Fujifilm seeks diversified development after market exploration, its earliest imaging business (traditional film, digital cameras, digital printing equipment), information business (printing, medical and other optical instruments and other optical materials), the document processing business of the three major business segments adjusted to the medical life sciences, high-performance materials, optical components, electronic imaging, document processing and printing of the six focus on the development of the business, the traditional film business in the company, the company is still the "top sponsor", but this has helped to save the fate of Kodak. business, the traditional film business in the company's overall revenue accounted for only 2%.
As China's "film king", Lucky's transformation path has also been the focus of outside attention. After realizing that only product restructuring to create profits is not enough to maintain the continued development of enterprises, Lucky in the original business digital transformation based on the choice of optical film (widely used in the field of optical and optoelectronic technology materials, flat-panel televisions, laptops and other LCD screens rely on one of the key materials is the optical film) as the main direction of the industrial restructuring to the technology-intensive, capital-intensive, technically difficult and high value-added fields.
While the arrival of the digital age because of the decline of the traditional film industry, companies are forced to transition, but from the market situation, the only Kodak transition is not strong after facing the dilemma of bankruptcy, this is because Kodak is a passive transition, Fuji, Luckys in the process of development of the business and strategic adjustments in a timely manner, although the transition can not talk about the very successful, but still maintains the momentum of the subsequent development, while the Kodak in the "betting" on the key material is optical film, as a major direction of industrial restructuring to technology-intensive, capital-intensive, high value-added areas. Kodak in the "bet" failed, the market led to have to transform, after many years of little result.
2, the century-old store more "innovation"
Kodak's decline, not only its technological innovation lag, but also its consumer experience is inevitable neglect. It wasn't until 2003 that Kodak announced its full-scale entry into the digital industry, followed by the sale of its medical imaging business and related patents.
But at that time, Canon, Fuji and other Japanese brands had already occupied the leading position in "digital imaging," and even South Korea's Samsung, and even China's Huaqi and other companies had already begun to take shape. At this point, the behemoth Kodak has lost the opportunity to occupy the "digital image".
In this era of rapid change, only "innovation" is the unchanging truth. This innovation is not only based on technology and management level, but also based on the business model, and even consumer experience level. And for the old companies, either in the stubbornness and arrogance in the death, or in the continuous innovation in the rejuvenation.
While, there is no absolute evergreen, the survival of the enterprise is full of many uncertainties. Similarly, innovation and change can not completely ensure that the enterprise will always be on the tide, but it is a necessary prerequisite for the continued survival and development of enterprises. Any stagnation without thinking about innovation is difficult to win the future, and arrogance and neglect of consumer experience will make it difficult to sustain.