Market Research : Creative Connections: The Phone, the Imaging Retailer and the Next Generation

February 2013 By Liz Cutting, Executive Director and Senior Imaging Analyst, The NPD Group

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Consumers are taking more photos and weaving photography into more aspects of their lives than ever before. That’s great news for the photo industry, in theory, but in reality, camera and camcorder revenue is on the decline. Year-to-date October 2012 revenue dropped 14%, and that’s on top of a 9% decline the year before, according to NPD’s Consumer Tracking Service.

The culprit for the decline is the smartphone, which now represents the biggest chunk of the photo and video capture scene. According to The NPD Group’s 2012 Imaging Confluence Study, the percentage of photos that consumers took with a smartphone grew from 27% in 2011 to 36% in 2012, leaving the compact camera as the device less likely to be taken out on the town (see Figure 1).

But before we bemoan the death of the dedicated digital camera, we must examine the nature of the photos captured with each device. Is the smartphone more likely to take “disposable” photos and therefore contribute more quantity than quality? From our Imaging Confluence Study, we found that about one-third of photos taken on smartphones are not archived at all, while less than 15% of dedicated camera shots are destined for the dead pixel society.  

Another way to gauge the importance of the images captured on a phone versus a digital camera is which device the consumer chooses to use for “memory shots” versus “spontaneous moments.” In 2012, phones started replacing dedicated cameras to capture the casual shot, with consumers saying they picked the phone over the camera two-thirds of the time. Vacation shooting, however, was another matter. While more than half of consumers who own mobile phones used them to take pictures on vacation in 2012, 65% of the time these shots were in addition to those they were taking with their cameras (see Figure 2).

As a whole, we can clearly state that things are not looking rosy for the dedicated image capture device market, but there are still bright spots in that market. More fully featured compact cameras and interchangeable-lens cameras are still growing both in units and dollars.

The future of the camera market belongs to the next generation of parents. Smartphones have taught this generation to expect compact simplicity in an image capture device, but we see from Figure 3, depicting feature desires, that shooting in low light and having ample optical zoom are also critical. Fulfilling these needs is where photo specialty retailers come in with their knowledge and expertise.

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