Camera House: ‘Best opportunity in 5 years’

With the introduction of an online printing solution supplied by Canadian outfit Dakis, a marketing support program from US photo specialist group IPI, and a range of accessories from US buying group PRO, the changes were clearly being rung at the Camera House annual general meeting and conference in late October.

Paul Shearer, general manager, Camera House.

Paul Shearer, general manager, Camera House.

Photo Counter spoke to Camera House general manager Paul Shearer about these developments and the immediate future of the local photo specialist retailing scene.

Horses for courses
Paul Shearer explained that the Dakis, IPI and ProMaster decisions were examples of a new approach. Instead of looking to one supplier to fulfil all Camera Houses’ needs for hardware, consumables and software, the group would select the best solution available from a range of competing options.

‘This isn’t an IPI campaign, it’s not a Fuji campaign, it’s not a Dakis campaign. It’s about 10 little bits which are excellent in these companies, and we’re pulling one bit out of each company to give us the very best solution. Because one system is not tailored for everyone,’ he said.

‘So now we are saying let’s find the best software. Let’s introduce ProMaster in there. We’ll take bits from separate organisations and we’ll find what’s best suited to our business, rather than relay on the total support of, say, a Kodak.

‘It’s not supporting Mitsubishi and it’s not not supporting Fuji. This is nothing like that. Whereas before we had a turnkey one-only solution, we are now throwing other parts in. It’s about having the best available.

Along with this comes a preparedness to adapt when something better comes along.

‘We could pull in Whitech’s photo album creator and have that as our photo album creator although our platform is based on Dakis,’ he explained.

He pointed out that while it was fine for a Big W to have ‘the same solution and the same everything in every store’, Camera House was comprised of ‘100 different independent retailers all having different needs.’

Looking at the competitive scene, Mr Shearer also emphasised that Camera House also had some unique challenges as a national group with a range of competitors who had strengths in one geographic area.

‘We base our smarts on a lot of market knowledge. We pay a lot of money for reports which tell us what models are being marketed at what price – and who by. And the consistency of them.

‘You have to do it nationally. So our problem is 70 to 80 percent of our business is not just based in Victoria. It’s easy to determine market activities in one state.

‘In NSW we’ve got a big CE retailer as a competitor. WA still have Retravision, SA have Radio Rentals which are incredibly strong. They all market differently, and we have to make sure that the retailers in those areas are not effected when camera manufacturers or Canon or anyone go to CE retailer with this camera, another NSW-based retailer with this other camera, and Camera House with another camera. Then in other states it might be completely reversed. So whatever they went to someone with in NSW, they need to find somewhere else to put it in another state.’

He said that there was a real opportunity in printing services, as activity from the two major discounters in printing potentially waned, and Camera House had plans to increase its printing activity.

‘I do believe the others will slow down – it’s becoming harder for them and more expensive. Photo in Big W and Harveys has a massive footprint and high costs . Do you think they make a lot of money?’

Competing suppliers
When it comes to suppliers competing with Camera House, Mr Shearer would rather they didn’t:

‘Manufacturers with online sites – they are another competitor. Would I like them not to do it? Yes. Can I stop them from doing it? No. Does the consumer wish in some way to do that [buy direct from the supplier] ? A small percentage, yes.

‘If they didn’t do it it would be fantastic but it would also be fantastic if JB HiFi didn’t sell cameras!

‘If consumers wish to buy from the manufacturer they will. And I don’t agree with it. I think it is wrong.

He also said that retailers confusing the public about price was part of the reason consumers might be attracted to buying from a supplier.

‘The consumer doesn’t know the price of anything. They have no idea any more of what the cost of anything is. And with price confusion you are actually causing distrust. In some CE discounters you don’t know if you buy in there whether the price will be marked down tomorrow.

On the other hand, ‘They feel they are getting a realistic price by buying from Canon. Not only are they getting a realistic price they are getting a global price.

‘Canon is not alone – Sony is just as proactive online,’ he added. ‘Globally most companies already do it. Is it successful? Well they don’t report that, do they?’

He said that the collapse of the compact market was an opportunity for photo specialists, as mass market competitors not only pulled back on printing, but withdrew from camera sales.

‘It was wonderful when they were selling 20,000 $99 cameras in 60 days. They made $5 a camera so they picked up $100,000 profit for nothing. They didn’t do anything. Those days are gone.

‘There’s no $99 or $69 volume market in anything.

‘The next 12 months will hold the greatest opportunity we’ve had in most probably five years,’ he said. As the average selling price of cameras rises, it becomes a more considered purchase, he noted.

‘At $149, $169 $229 – did it matter what camera you got?’ But with an average selling price around $500, consumers are more willing to research their purchase and seek expert advice.

‘”Why should I be buying this? Why should I buy the Fuji X Pro in lieu of the Sony A7?” The good thing is that there’s lots of new technology, lots of high dollars, so consumers want to go and get reasonable advice from someone with knowledge.’

He added that the more recent decline in the DSLR market (see separate story) was also contributing to mass market competitors being less inclined to devote floor space, marketing and services to the photography category.

The ProMaster initiative
The most controversial step Camera House made was to bring its distribution of ProMaster accessories from trial stage to group-wide availability. It was suggested to Paul Shearer that this has not been welcomed by existing Australian-based accessory suppliers.

‘We worked with suppliers and communicated for a long time to get more margin at retail,’ he said.

‘Ultimately hardware is getting harder and harder because of global pricing. But if we drop margin on hardware we still need margin to run our businesses, so we had to find more margin in other products.’

 

 

 

 


2 thoughts on “Camera House: ‘Best opportunity in 5 years’

  1. Retailers have been pushed into competing with importers and manufactures.
    It is time that we consider the consequences of our actions.
    Yes we must expect some fierce competition when we break with tradition and bypass our traditional suppliers just as they must realise that their actions create our behaviour.
    Effectively I have been a speciality retailer for many years and have been pushed into becoming a minor importer as what I desired to merchandise had insufficient volume for any of the majors to look at.
    End result I built a decent following and my efforts were rewarded by a major taking the product which resulted in a drop in market penetration in our country.
    This has occurred many times over the years when greed takes control of ethics and eventually results in staff being pirated and industry disruption over a wide range.
    I am retired in effect but still consult to the old firm and truly I am glad that I no longer need to suffer the actions of the varied players still remaining.
    Wake-up call, train your people in product, ethics, manners with decent pay with incentives that endure their loyalty so hopefully such comments as this will become a thing of the past

  2. Ron: You still have a way of saying things with a succinct clarity that does you great credit. Our industry has in many respects started to return to the days where a few large players dominate, and where the very best of the Specialists are indeed bringing something of real value to the consumer. More than just price; service, education, skill and enagagement. And in some stores I visit, real excitement -the buzz of people discovering what is possible with new Photobook kiosk software, how easy it is to get all those old prints scanned and digitized, how to actually get better pictures by investing in this lens rather than that one the camera maker kindly bundles with the camera, (but often leaves you worse off than your old compact). The list goes on.
    It is tough out there. I write this from Shinjuku, Japan – 500 metres from Yodobashi Camera. Gone are the six floors of photo I remember 40 years ago, now it’s basically two and a half, the rest is electronics. Same goes for equivalent stores around this photo capital of the world. And meantime the largest retailer of photo in Japan is probably now Amazon, as it is in much of Europe and the US. I read that they are just around the corner in Oz today, opening the new Kindle store in the past few days. So the next great wave of change will come sooner than most people think; and if you are not ready with new values and experiences for your customers it will be time to leave the stage.

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