THRU 3Q. OF 2009 KODAK SHIPS 800,000 PRINTERS (live video)

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THRU 3Q. OF 2009 KODAK SHIPS 800,000 PRINTERS (live video)

 user 2009-12-07 at 10:19:47 am Views: 45
  • #23051
    THRU 3Q. OF 2009 KODAK SHIPS 800,000

    Kodak printer ads
    remind consumers of lower ink costs

    on this link below to see live video
    Photo giant Kodak burst onto the home printing scene in 2007
    vowing to shake up the industry by selling ink at half the price of its
    competitors.But while the company has succeeded in doubling its tiny
    market share year to year – to 2% in 2009 – industry heavyweights
    Hewlett-Packard, Epson and Canon have yet to respond with major ink
    price cuts, nor are they expected to, says Andy Lippman, a senior
    analyst at Lyra Research.”It’s a testament to the business model,” he
    says. “You sell the printer at a loss and make it up on ink sales. If HP
    was to match Kodak’s pricing, it would be monumental, and you’d see an
    immediate impact on its profit margins.”The recession has taken its toll
    on sales of ink-jet printers, which are down 12% this year, Lippman
    says, but ink sales have fallen only 6%.”Consumers say they care about
    the high cost of ink, but when they go to the store to buy a new
    printer, they shop for price,” Lippman adds. “They’ve heard the
    messaging from Kodak, but it hasn’t resonated.”

    Kodak, which
    launched its printer line with an aggressive series of infomercials on
    pricing, is pushing back with an even feistier $30 million “Print and
    Prosper” TV and webcampaign.Its website, for instance, tells consumers
    they would have saved $110 in printing costs had they switched to Kodak.
    It also offers a price chart that promises to tell how much folks
    overspent with their various printer models from Epson, HP, Canon,
    Lexmark and Brother.The calculations are based on a basic formula, of,
    for instance, eight black-and-white documents, six color documents and a
    4-by-6 photo printed in a specific time period. Kodak generally charges
    more than competitors do for printers.

    No. 1 HP says the
    ink-savings claims are misleading. “Their savings are probably at best
    at about $1 per month,” says Andy Binder, HP’s director of market
    development.Still, on an average HP color printer, Binder says that it
    costs about $75 to restock the six color inks and one black ink. Kodak’s
    inks are $9.99 for a black cartridge and $14.99 for color.Kodak says it
    bases its findings on an average of 1,500 printed pages per year for
    the average consumer. Binder says that’s way too high and that most
    folks print 750 pages.

    He adds that HP makes printers
    specifically for price-sensitive people who print a lot of
    black-and-white documents, which use less ink.Cheryl Pohlman, a Kodak
    marketing director, says the “Print and Prosper” marketing campaign has
    helped the company sell twice as many printers this year as last
    year.”There’s a frustration level when consumers go to the store and
    have to spend $75 on ink, especially in these economic times,” she says.

    shipped about 800,000 printers in the first three quarters of 2009 – up
    from 400,000 at the same time last year, IDC analyst Ron Glaz
    says.However, that’s not enough to pull it out of last place in market
    share, Glaz says.Industry leader HP shipped 18.4 million printers, down
    from 21.7 million in 2008. It’s current market share is 47%, down from
    51% in 2008, IDC says.”People just don’t see the need to print as much
    as they used to, which is what’s causing the decline,” Glaz says. “A lot
    of homework is sent electronically now. They’re sending photos to
    Facebook instead of printing them. In this era of the smartphone, when
    we’re online all the time, do we really need to print everything we
    see?”When Kodak launched its printer line, it told analysts it would
    achieve $1 billion in sales by the end of 2010.

    Recession has
    an impact

    Lippman says that’s not going to happen, estimating
    Kodak’s sales to date at about $350 million.”They were a bit too
    optimistic about consumers and their understanding of print costs,” he
    says. “Plus, they couldn’t have foreseen the recession.”Consumers have
    been holding off their purchases of new printers, waiting for current
    printers to break or jam before buying, he adds.A visit to the store,
    however, would find some innovations to current printers, including some
    new models with Wi-Fi capability for wireless printing.One thing hasn’t
    changed, however: An ink refresh will still set you back almost as much
    as a new printer, unless you call on printer sales are
    down 12% this year.