Kodak: Burden of being the first and the biggest

Long back Ted Levitt wrote in one of the most influential articles in the area of marketing titled ‘Marketing Myopia’; every major industry was once a growth industry. But some that are now riding a wave of growth enthusiasm are very much in the shadow of decline. Others that are thought of as seasoned growth industries have actually stopped growing. In every case, the reason growth is threatened, slowed, or stopped is not because the market is saturated. It is because there has been a failure of management.

Companies and brands as value creators and signifiers seek constancy. Firms seek perpetuity and brands aim to defy the effects of time. Both do not exist in a vacuum rather belong to environment which is always in a state of spin. A boat can scarcely stand still in water without right paddling and maneuvering. Levitt claimed that railroads and Hollywood declined not because of market maturity but due their management who wrongly defined what business they were in. At the center of their poor fate was not the lack of technical competence rather their orientation or mind set. Levitt cautioned that, in truth, there is no such thing as a growth industry, I believe. There are only companies organized and operated to create and capitalize on growth opportunities. There are numerous examples of so called growth industries which are either dead or dying have caught in self-deceiving cycle. Levitt cited a mindset characterized by beliefs that: growth is assured by expansion of affluent population; no competitive substitute; faith in mass production and preoccupation with a product which lends itself to improvement and manufacturing cost reduction.

Eastman Kodak Company gave this world first hand held camera. Along with the camera Kodak is credited among other things for Kodachrome film, electronic camera which sent still pictures from moon, first digital camera, OLED technology, and Kodak image sensors captured close- up of Mars. The company was quick to become a great success by introducing a paradigm shift in the way pictures was taken and who took them. Its user friendly products allowed everyone to capture everyday moments. The slogan ‘you press the button, and we do the rest’ epitomized the essence of Kodak brand- empowerment to capture and store moments for posterity. Technically Kodak replaced glass photographic plates with a film roll making the photographing process much easier and simpler.
Technological developments are not always linear and incremental creating product improvements. Often these are disruptive and out of box. Imagine emerging competition between mobile phone makers and camera makers. Consider how Xerox which pioneered photocopying was threatened by personal computers. Post offices have almost been made irrelevant by e mail services. In the similar vein, old cinema reel prints are fast becoming thing of past as new films are distributed through digital prints. The brick and mortar mom and pop stores in India actually face a real threat from e commerce ventures rather than the likes of Wal-Mart. The dividing line between the television and computer may further get blurred in times to come.
Kodak had its own share of challenged being unleashed by newer technologies both disruptive and incremental. The shift from black and white imaging to color technology was seized by Kodak which allowed the company to exhibit robust performance in the US market. Till the mid-seventies Kodak held monopoly position both in film and camera market. However things began to change with the disruption introduced by the invention of digital technology. As a consequence the sales of both film cameras and film began to decline. The business model akin to Gillette cheap razor expensive blades which allowed Kodak to make money by selling films and processing developed cracks as digital cameras neither needed film nor professional processing. And even prints could also be created on home printers. Kodak’s serious entry into digital camera business come much late in mid-nineties, though it had good product but its high price never allowed to get volumes. The company could not give up its film manufacturing (product centricity) till 2009 even though obituary of the technology was written long back.
The greatest irony is that Kodak itself invented digital camera which eventually blew off company’s business of making film and film camera. It is not that the need to capture moments and share memories has vanished it is just that newer products are better able to satisfy it. The window of opportunity for others was created by Kodak itself as it failed to appreciate the new technology using customer centric perspective. What others did to Kodak, the company should have done to itself.
Who says competition kills?


2 thoughts on “Kodak: Burden of being the first and the biggest

  1. Sir, Though the block looks very good but i have a sincere suggestion

    In reverse style (i.e. black background and white text inputs) its a bit harsh on eyes to read the fantastic write ups, especially on modern LED screens

    Also David Oglivy in his book has written about how research also shows that any write up in reverse is less impactful

    So Sir, can you please facilitate normal writing style i.e. black ink and white background

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