A Look Ahead to 2014 Retail Trends

A Look Ahead to 2014 Retail Trends

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After a tumultuous 2013, the prognosis for 2014 is for continued innovation and change. Last year saw changes as the continued iterations of apps, apps and more apps grabbed headlines. Smartphones were the cameras of choice for most people, impacting compact camera sales. In the interchangeable-lens market, full-frame mirrorless cameras challenged DSLRs. And, a social photo start-up with zero revenue spurned a $3 billion buyout because it was insufficient. Yes, we live in an upside-down world.

 Retail Trends

What are some of the coming trends for photo retailers? Look for the increasing impact of mobile on retail. This doesn’t just mean people using photo apps to capture, to edit and to share their moments, but using other functions like geo-location services to spur foot traffic. For example, to combat “showrooming,” big-box retailers like Best Buy are using geo-location technology to offer in-store offers and coupons. (Geo-location uses a mobile device’s GPS to determine the smartphone’s location and tailors services directly to this location.) Best Buy replaced its RewardZone program with an enhanced My Best Buys program, which has features that only show up when a customer is inside the store. In exchange for checking in to a geo-fenced Best Buy location, consumers could receive 10 loyalty program points and other special offers.

Geo-fencing—where a retailer can designate certain areas in a physical store—will also have an impact on the photo kiosk market. Retailers struggling to justify a fleet of kiosks, with the attendant updates, upgrades and maintenance, may find an answer in a localized app.

Retailers are now finding success with print-to-store apps, so the next logical extension will be print in-store apps, which could offer coupons or special offers to those customers who place photo orders while physically inside stores. This will drive foot traffic and incidental sales, while rewarding the best customers, not just the ones seeking cents-off deals. Offers can even be targeted to specific customers, based on their purchase history.

Instrumental to this trend is the continued adoption of cloud services for photo storage and sharing. The cloud is now the equivalent of the color negative strip. You could store images on a color negative and take it to nearly any photofinisher to get prints made. Cloud storage networks like Dropbox, Box, Google Drive, etc., are the new digital shoeboxes where images are stored. Facebook, Instagram and Google+ are the 21st century photo albums where stories are shared. Accessing images in the cloud is vital to success for mobile imaging. No more will consumers have to return home for a forgotten media card or ask family members to e-mail them a photo needed to finish a book while sitting at a kiosk. Always-on access to consumer’s data will drive the mobile economy.

Unfortunately, photo-specific cloud services like Everpix and Linea have failed, illustrating the fact that just merely participating in a trend does not necessarily guarantee success. A business model based on a feature—like automated photo backup—is a difficult one to monetize, considering the number of no-cost options out there. Flickr alone offers 1TB of free online photo storage, while stalwarts like Shutterfly and Snapfish have offered what is essentially unlimited storage for years. This is not to say someone won’t come up with a winning formula—and more start-ups like Forever (forever.com) are trying—but the sweet spot of value, function and ease of use has yet to reached.

Online-first firms like Amazon will continue to experiment with ways to provide the efficiencies of their just-in-time warehousing and ordering systems directly to consumers. Last year’s experiments with putting Amazon Lockers in retail locations was a failure, but the recent “same-day drone delivery” announcement by Amazon CEO Jeff Bezos shows how serious the company is about maintaining its competitive edge.

Photo printing will continue to make inroads with social networks, as more and more apps begin to access the wealth of images stored on Facebook, in particular. Instagram images seem to be best suited for one-off projects, like cards, mugs and small canvases, while Facebook is more suited for photo books or collage posters.

One start-up, MySocialBook (mysocialbook.com) makes a book from a consumer’s entire social profile, including posts, likes and photos. The programming is intelligent enough to emphasize the most popular posts, while de-emphasizing the least popular ones. This approach is certainly a compelling product for socially active people, but it will be interesting to see how well it fares with continued evolution of social networks. Such services rise and fall with the popularity of these networks.

Of course, just printing from social networks is not necessarily a winner in and of itself. Qoop was a digital printer with a seven-year pedigree before shutting its doors in 2012. The company was one of the first to offer a Facebook printing app, but this never took off. The use case was different; while browsing someone’s social feed, the user isn’t thinking foremost about printing. That’s why it’s more compelling to access social photos from within dedicated photo or printing apps. The users already intend to make a product, and accessing the wealth of social photo images is just what is needed (especially now that Facebook photos are of printable resolution).

Camera Challenges

Back in the analog days, the dream of the film companies was to have a camera in every pocket. Now, in the digital age, this dream has turned into a nightmare for many camera makers. Just as the compact digital camera replaced the film camera, the compact point-and-shoot camera itself is under assault by smartphones. There’s nothing inherently wrong with a digital camera—just as film cameras are perfectly fine—but the use case for snapshots is changing. App selection and online access trump a higher quality lens for most people, especially when the carrier subsidizes the purchase of the smartphone.

But, are things really that bad? Maybe not. Consumers are actually buying more cameras than ever, not just smartphone cameras. The mirrorless ILC or compact system camera (CSC) platform is gaining steam, especially in Europe and in Asia, while the DSLR continues to evolve into a high-quality photo/video platform.

The popularity of GoPro and other wearable action cameras is growing. The new “smart watches,” like the Samsung Galaxy Gear, have tiny cameras in the wristband. Cameras are now mounted on drones for easy and inexpensive aerial photography and videography.

Photo specialty retailers should be actively marketing, demonstrating and selling these camera devices, as they would any other camera. Sure, these new brands don’t carry the cache of a Leica, a Nikon or a Canon, but they are garnering a devoted following. The key to successful retailing is being where the market is going, not living in the past, hoping someone will come in to buy those Kodak Carousel projectors gathering dust in the backroom.

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