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Archive 2017 · Nikon's new strategy....sounds good to me...

  
 
chez
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p.5 #1 · Nikon's new strategy....sounds good to me...


charles.K wrote:
With respect to entry level DSLR's or mirrorless, some of the most discerning groups are parents with young kids. This is so important for them. They often try to capture images of their new born or children running around and realize the smart phone is not enough for movement or taking shots inside in lower light.

I personally know of 6 young families around me, and 5 of them have an entry level DSLR's for this reason alone. They all have great smart phones and use them a lot, but I am always amazed at the quality of the images they
...Show more

Yeh, maybe, but I see the young generation, the under 30 crowd all carrying their phones and not using DSLR cameras. Traveling around these past few years everyone young was shooting with phones. There were the occasional person with a DSLR and some mirrorless especially in Asia, but the huge majority...I'm talking a magnitude or more, were people shooting with their phones..especially the younger folk.

My daughter is a good example. She is 32 and I've given her a 20d which she never used and I've got her a nice Olympus which she travels with, but when she come back the majority of her photos are from her phone...and she is happy showing them off. Her hiking partners, maybe 12 kids about her age, don't own a camera...not a single one. They all use their phones.

I was in Kauai last year on the beach photographing the sunset. There were a few other die hard photogs with their tripods etc..., but looking around everyone else had their phones out taking photos of the sunset or selfies or whatever..bottom line they did not have a DSLR, not a mirror less, not even a P&S...they all had their phones.

I don't see this trend changing as the cameras in the phones will just keep getting better and the need to carry a separate device just to take photos will be less needed with each new generation of phone.



Feb 28, 2017 at 07:11 PM
chez
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p.5 #2 · Nikon's new strategy....sounds good to me...


Max Power wrote:
Are phone cameras really eating into DSLR sales? I am not sure that they are. Let's think about the markets for a bit.

DSLR sales grew exponentially over film body sales early on for a number of reasons. One, I think that users could now shoot hundreds of images with no film and developing costs, so digital was a bargain. I quit film for a decade because of costs, I jumped back in when the D70 was affordable. Digital brought me back to the hobby. Also, being a new technology, tons people were upgrading because of the exponential technology
...Show more

The erosion of the low end camera market is having a huge effect on DSLR as the low end is were the majority of revenue came from...not the high end gear we all talk about. With those revenue generating cameras eaten up by the phones...the impact is now the camera companies are left with a much smaller revenue pie than before which will result in the price increases we are seeing from all the camera manufacturers. That is a direct impact on the DSLR market...fewer camera sales at a higher margin.

So for you and me it means we will be shelling out more moola for our gear going forward.




Feb 28, 2017 at 07:22 PM
Diallo_Jamal
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p.5 #3 · Nikon's new strategy....sounds good to me...


PIXPHATIC wrote:
To counter the threat from the mobile cameras, it seems that the camera Cos would come out with a simple sharing app from cameras to mobiles and ready to be uploaded, after basic editing, via wifi or bluetooth.
Also it seems in addition to the already available file size options of JPEG/RAW/TIFF, a 'web-ready' file size of apprx 500/750 kb would be offered for ready sharing and instant upload via mobile and apps.
We are living in a tech driven era, and these are just too simple features to get installed.
Besides there are already wifi SD cards to
...Show more

The D5500 does a passable job of this. My GF can pick between 'recommended' size and lower rez options, download the pics to her phone and upload to social media in short order. This allows her to get pictures of better quality than her phone allows online pretty quickly. I've dabbled with getting a wifi card for my camera so I can pass off a few photos quickly. (I have a wifi dongle, but use that more for remote shooting).

My GF is the type who never would have picked up a dSLR w/o me having purchased one for her, but through my pictures and her own she sees that they are capable of producing better pictures than her mobile. She cares about getting the pictures to Social Media quickly, and there are solutions for that d5500 or wifi dongles.

My Thai teacher has an inherent interest in photography and is very price sensitive (that sensitivity is likely to diminish a touch as she matures, but she is young now). In looking at options with her, I'd like her to get something that has good picture quality, a decent ecosystem and where she can get a kit + fast prime at a reasonable price (I am not defaulting to nikon for her, as she may get more utility out of a smaller form factor thought she is okay with that of dSLRs). I initially over estimated the importance of being able to instantly share to social media to her. I thought this would have greater importance to her than my GF (teacher being ~10 year younger), but there were other features which were more important to her.




Feb 28, 2017 at 09:05 PM
Max Power
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p.5 #4 · Nikon's new strategy....sounds good to me...


chez wrote:
The erosion of the low end camera market is having a huge effect on DSLR as the low end is were the majority of revenue came from...not the high end gear we all talk about. With those revenue generating cameras eaten up by the phones...the impact is now the camera companies are left with a much smaller revenue pie than before which will result in the price increases we are seeing from all the camera manufacturers. That is a direct impact on the DSLR market...fewer camera sales at a higher margin.

So for you and me it means we will be
...Show more

If by "low end" you mean point and shoot, I am not sure Coolpix cameras ever represented huge volume for Nikon. I would love to see actual sales numbers rather than rampant speculation.




Feb 28, 2017 at 11:38 PM
Lance B
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p.5 #5 · Nikon's new strategy....sounds good to me...


Max Power wrote:
Are phone cameras really eating into DSLR sales? I am not sure that they are. Let's think about the markets for a bit.


Are you suggesting I didn't think about it? I have thought about it a lot.



DSLR sales grew exponentially over film body sales early on for a number of reasons. One, I think that users could now shoot hundreds of images with no film and developing costs, so digital was a bargain. I quit film for a decade because of costs, I jumped back in when the D70 was affordable. Digital brought me back to the hobby. Also, being a new technology, tons people were upgrading because of the exponential technology growth. Manufacturers weren't selling to new DSLR customers at this point, they were selling to the same people that bought previous versions, making the
...Show more

In my post I stated that DSLR's *and* P&S were being affected, yes I would say P&S are a major loser and DSLRs less so because DSLR's aren't really the same market segment. However, I do think they are being affected all the same. Your reasoning about camera maturity is a valid one, but I still contend that camera phones are eating into that market somewhat and part of that maturity and lack of DSLR sales is that people with phones are simply not upgrading their DSLR. Take away the phones and you would see more DSLR sales for sure. As I said, my 3 kids all had a lower end DSLR and they do not use them now at all, all they use is their camera phone, it is convenient, portable and it is always with them. I would suggest there are many who do the same and that number is growing.



Mar 01, 2017 at 02:59 AM
Max Power
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p.5 #6 · Nikon's new strategy....sounds good to me...


Lance B wrote:
Are you suggesting I didn't think about it? I have thought about it a lot.

In my post I stated that DSLR's *and* P&S were being affected, yes I would say P&S are a major loser and DSLRs less so because DSLR's aren't really the same market segment. However, I do think they are being affected all the same. Your reasoning about camera maturity is a valid one, but I still contend that camera phones are eating into that market somewhat and part of that maturity and lack of DSLR sales is that people with phones are simply not
...Show more

I guess I dont understand what about smart phones would prevent people from upgrading DSLRs? What do they provide that would limit upgrades? I think a fair case could be made in your daughters cases that if they put away their DSLRs and favor their smart phones, they never would have, or needed to upgrade their DSLRs anyway.

I can see to a minor extent where good phone cameras my eat into initial or first time buyers of lower level DSLRs, but I think most of the sales being cannabalized are still in the P&S category. Most meaning a huge percentage. I used to bartend at a popular nightclub on weekends for the better part of two decades. I was always asked to take pictures of groups op people celebrating personal events or just having fun, and in the beginning I was always handed P&S cameras. In the end it was nothing but cel phones. It was never in 20 years a DSLR. Those are the people that I think are in the majority if camera sales lost. They are not photographers.

Its all speculation by many of course, using strawman arguments as definitives, and anecdotal evidance as global truths, and nobody is right or wrong until Nikon releases sales data, which I doubt will happen. I guess I just beleive that most DSLRs users are a diferent customer than people who are happy with cel phone cameras, and the majority of decline is more due to the pipeline being filled and the plateau of technology.



Mar 01, 2017 at 07:30 AM
chez
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p.5 #7 · Nikon's new strategy....sounds good to me...


Max Power wrote:
If by "low end" you mean point and shoot, I am not sure Coolpix cameras ever represented huge volume for Nikon. I would love to see actual sales numbers rather than rampant speculation.



If you Really want to see actual sales numbers, go to the Nikon investors relations page and it's all there. I have no plans to spoon feed you the data.



Mar 01, 2017 at 08:15 AM
Max Power
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p.5 #8 · Nikon's new strategy....sounds good to me...


chez wrote:
If you Really want to see actual sales numbers, go to the Nikon investors relations page and it's all there. I have no plans to spoon feed you the data.


I did, thank you for the polite suggestion.

Of course, as with all financial reports, specifics on models and classes were somewhat lacking. DSLR sales for the last year were boosted by the D5 and D500, and the P&S category is being hit hard, I think we already knew that. However, it really doesn't address that reduced sales of Coolpix dramatically effects high end models, and it really doesn't support the assertion that the low end stuff pays for the high end stuff at all.

They also report in unit sales as a group. I didn't see margins as a group, maybe I missed where to find that. I would guess Coolpix is a lower margin category as well.



Mar 01, 2017 at 09:50 AM
chez
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p.5 #9 · Nikon's new strategy....sounds good to me...


Here are a few graphs which show the importance of the low end of the market to companies like Nikon and Canon...in fact most camera manufactures.

As can be seen, in 2011 the non interchangeable lens cameras ( P&S ) provided nearly 2/3 of all the revenue in camera sales, almost 1,000 billion yen. In 2015 that amount dropped to 300 billion yen or a 700 billion yen decline in just 4 years. I'm sure that revenue contributed greatly to the R&D budget for the imagining divisions. Haven't looked into Canon, but I'm sure its the same picture.

So to think the loss of the P&S market does not hit Nikon where it hurts...think again.







Total cameras shipped







Total camera revenue







DSLR cameras shipped







DSLR camera revenue




Mar 01, 2017 at 12:11 PM
Max Power
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p.5 #10 · Nikon's new strategy....sounds good to me...


chez wrote:
Here are a few graphs which show the importance of the low end of the market to companies like Nikon and Canon...in fact most camera manufactures.

As can be seen, in 2011 the non interchangeable lens cameras ( P&S ) provided nearly 2/3 of all the revenue in camera sales, almost 1,000 billion yen. In 2015 that amount dropped to 300 billion yen or a 700 billion yen decline in just 4 years. I'm sure that revenue contributed greatly to the R&D budget for the imagining divisions. Haven't looked into Canon, but I'm sure its the same picture.

So to think the
...Show more

My initial response to all of this was that I am not so sure that cell phone cameras are hurting DSLR sales.

To which you replied "The erosion of the low end camera market is having a huge effect on DSLR as the low end is were the majority of revenue came from...not the high end gear we all talk about."

Well, maybe, but that is a statement that addresses overall corporate revenue, not DSLR sales. I am not sure why you addressed my uncertainty that the DSLR sales volume is negatively effected by cell phones into a corporate health issue. While it is an issue, it wasn't the one I was addressing.

We have all acknowledged that cell phone sales have decimated P&S sales, everyone can see that. It's patently obvious. I still don't see evidence that that is the reason for any erosion in DSLR sales.

In 2016, Nikon's sales of P&S units were behind that of removable lens camera and lens sales. It is simply a smaller slice of the pie, not sure where it was in 2011 as Nikon's corporate report site doesn't go back that far. One can guess.

Regardless, in 2016, Nikon continued to make medium and high end cameras that are price competitive and in many cases class leading, so in the near future, it doesn't appear the erosion of Coolpix sales has any more effect on the stuff we care about than losses in any other of Nikon's divisions. Time will tell, of course.

In the meantime, when discussing actual number of sales of new DSLR cameras, I am still not sure that the erosion isn't just a byproduct of marketplace maturation, same as PC sales.




Mar 01, 2017 at 04:17 PM
chez
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p.5 #11 · Nikon's new strategy....sounds good to me...


Max Power wrote:
My initial response to all of this was that I am not so sure that cell phone cameras are hurting DSLR sales.

To which you replied "The erosion of the low end camera market is having a huge effect on DSLR as the low end is were the majority of revenue came from...not the high end gear we all talk about."

Well, maybe, but that is a statement that addresses overall corporate revenue, not DSLR sales. I am not sure why you addressed my uncertainty that the DSLR sales volume is negatively effected by cell phones into a corporate health
...Show more

Max, you can look at it any way you want...but a decline of revenue by more than 50% in 4 years is not good...I don't care how you spin it. And a lot of that revenue came from the low end cameras. What that is forcing Nikon as well as other camera manufactures to do is increase their prices on the existing cameras and lenses which will affect everyone here.

I don't see how you can see something positive out of those graphs...I just see negative. Now Nikon is restructuring...has to as it's against the wall. Some companies come out looking good after a restructure...many fail and are sold off into pieces. Time will tell where Nikon ends up...the clock is definitely ticking.



Mar 01, 2017 at 05:12 PM
Max Power
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p.5 #12 · Nikon's new strategy....sounds good to me...


I am not spinning anything, and I didn't say it was positive. You have turned this into a different conversation.

The loss of revenue from low end cameras is really no different than the loss in revenue in the lithography division, in the grand scheme of things. It hurts the company as a whole, but you can't say for certain how that will reflect on high end DSLR sales or pricing.

And it still doesn't answer my speculation that cell phone sales really don't take away from the sales of DSLRs, but at this point, I realize that is a question that won't get answered, and this is on the verge of boring the crap out of everybody else. So, peace out.



Mar 01, 2017 at 05:21 PM
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p.5 #13 · Nikon's new strategy....sounds good to me...


charles.K wrote:
With respect to entry level DSLR's or mirrorless, some of the most discerning groups are parents with young kids. This is so important for them. They often try to capture images of their new born or children running around and realize the smart phone is not enough for movement or taking shots inside in lower light.

I personally know of 6 young families around me, and 5 of them have an entry level DSLR's for this reason alone. They all have great smart phones and use them a lot, but I am always amazed at the quality of the images they
...Show more

At my son's recent boy scout event and later, at my daughter's girl scout event, I was in both cases the only parent with a non cell phone camera. That's 30 parents at the boy scout event and 12 or so at the girl scout. Every last one aside from me used their (mostly) iPhones. I stuck out like a sore thumb shooting my Canon 1V.




Mar 01, 2017 at 05:39 PM
George Orwell
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p.5 #14 · Nikon's new strategy....sounds good to me...


Max Power wrote:


In the meantime, when discussing actual number of sales of new DSLR cameras, I am still not sure that the erosion isn't just a byproduct of marketplace maturation, same as PC sales.



You assume that the market is stagnate but that is a false assumption. Every year millions more Chinese join the middle class and can afford cameras. Every year a huge number of people in India also join the middle class. Every developing country that is successful is growing their middle class population. These people can afford nice cameras but in most cases, they don't buy them. Cell phones are good enough. Hundreds of millions of iPhones sold through th years and much, much fewer Canons or Nikons.






Mar 01, 2017 at 05:48 PM
JohnK007
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p.5 #15 · Nikon's new strategy....sounds good to me...


Max Power wrote:
I guess I dont understand what about smart phones would prevent people from upgrading DSLRs? What do they provide that would limit upgrades? I think a fair case could be made in your daughters cases that if they put away their DSLRs and favor their smart phones, they never would have, or needed to upgrade their DSLRs anyway.



Because 99% of the people wanting to take photos don't care about "good" photography; they just want to take pictures.

For example, my own brother and his family planned a trip to Europe last year. They all see me bringing my gear over to our folks' house when we have get-togethers. They all like the images I capture, take the time to process, touch-up, re-size, and then upload into Facebook, or send to my phone and text to them, personally.

So, before they left for Europe, I stressed to them they should really consider buying an actual camera, and at least a wide + standard (or maybe 1 zoom) just to preserve their memories as best they could.

They shopped and shopped ... but at the end of the day 1) my brother didn't want to spend another $1,000 -$2000 ... when he, his wife, and their 21 year old daughter already have $700 Galaxy smartphones, 2) they didn't want to have to learn how to use processing software, 3) NO ONE wanted to carry the extra weight around their neck, and 4) even pocket cameras canNOT share the images immediately to friends and family, as can their cell phones.

So, despite how much they like my images of the family and such, they don't want to go through all that trouble (and expense) themselves. As such, they didn't buy a single extra component ... and had a marvelous time taking photos with their cell phones, sharing to FB, and texting to their friends as they went along ... no "extra camera" required.

This exact same scenario is playing in the marketplace all over the world.

A camera is nothing but an extra expense, and an extra hassle, for the average consumer who is already equipped to take photos with their cell phones.

10 years ago, every single person *needed* to buy "an entry level camera" to take family/vacation photos.

Today, no one does: the already have one in their phones.

Edited on Mar 01, 2017 at 11:17 PM · View previous versions



Mar 01, 2017 at 11:04 PM
JohnK007
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p.5 #16 · Nikon's new strategy....sounds good to me...


George Orwell wrote:
At my son's recent boy scout event and later, at my daughter's girl scout event, I was in both cases the only parent with a non cell phone camera. That's 30 parents at the boy scout event and 12 or so at the girl scout. Every last one aside from me used their (mostly) iPhones. I stuck out like a sore thumb shooting my Canon 1V.


Yup



Mar 01, 2017 at 11:06 PM
Max Power
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p.5 #17 · Nikon's new strategy....sounds good to me...


JohnK007 wrote:
Because 99% of the people wanting to take photos don't care about "good" photography; they just want to take pictures.

For example, my own brother and his family planned a trip to Europe last year. They all see me bringing my gear over to our folks' house when we have get-togethers. They all like the images I capture, take the time to process, touch-up, re-size, and then upload into Facebook, or send to my phone and text to them, personally.

So, before they left for Europe, I stressed to them they should really consider buying an actual camera, and at least a
...Show more

I get that, I have many people like that in my family myself, but it still doesnt address the theoretical I floated oh so many posts ago. Were these people ever going to be DSLR customers? If they "just want to take pictures" arent they you typical point and shoot customer rather that a DSLR customer? Is the cell phone really keeping them from becoming hobbyists?



Mar 02, 2017 at 06:58 AM
PhotoMaximum
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p.5 #18 · Nikon's new strategy....sounds good to me...


Photography keeps evolving. But the main foundation remains: sharing a moment in time with family, friends, and increasingly, with complete strangers.

Digital ushered in a big change in that you did not need to fiddle with film, get it developed, etc, before making prints. But digital required you go home, fiddle with a card reader, upload your images into a computer folder, edit them and then share you photos.

The phone bypasses all that. With a couple of thumb clicks on the screen you can email, text message, and upload to any social media site instantly. Editing tools for cropping, color changes and all kinds of hip filters are right there. It's fun, fast, direct and easy. The UI and the picture quality has become very good and will only get better. If Canikonsonypentaxfuji comes out with a new 300-MegapixelFabulousCamera Pro with Kung Fu Grip camera the majority of people across the globe will shrug and say "who cares?" Their needs are met with a device that is super slim, does so much AND takes easy pictures and 4K video.

I think our interest group(camera and interchangeable lenses) on forums like this will always be a nich movement. We might get fancier toys in the future but our numbers, relative to the population as a whole, might become smaller and smaller as smart phone technology evolves...



Mar 02, 2017 at 10:07 AM
JohnK007
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p.5 #19 · Nikon's new strategy....sounds good to me...


Max Power wrote:
I get that, I have many people like that in my family myself, but it still doesnt address the theoretical I floated oh so many posts ago. Were these people ever going to be DSLR customers? If they "just want to take pictures" arent they you typical point and shoot customer rather that a DSLR customer? Is the cell phone really keeping them from becoming hobbyists?


It is hard to quantify the predilections of "all people" in an internet post

I hear what you're saying, though, and agree that cell phones have more strongly obliterated the point-and-shoot market. However, because most phones also shoot 4K UHD video, even RAW now, they make weak, low-end DSLRs look equally-unappealing IMO.

There needs to be an unmistakable improvement in a move from a $500-$700 cell phone to a DSLR. Making tiny, light-weight camera-toys (for $500) doesn't inspire, when some of today's cell phones feel heavier and better-made than a low-end camera. People with very expensive phones want to feel that their move to "more serious" photography is exactly that: more serious.

The people who move to DSLRs, to upgrade their images, are going to be those with specialized wants/needs (sports, wildlife, modeling/advertising, etc.). Hence, it seems Nikon is apparently realizing this and moving to the better-end of their inventory.

Right now, they are practically having to give away their low-end cameras:

http://www.nikonusa.com/en/nikon-products/product/dslr-cameras/1571/d3400.html

$500 for a camera plus lens

Moving forward, I believe cameras should represent quality, not "budget" anymore.

The iPhones and Samsungs are so popular, not because they're the cheapest, but because they do so much for so many,

Apple isn't targeting folks who want a $30 burner phone; they're targeting people who want the best possible phones.

Nikon needs to be like this is well.



Mar 02, 2017 at 10:28 AM
PhotoMaximum
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p.5 #20 · Nikon's new strategy....sounds good to me...


In the old days with Nikon (and Canon) the marketing/advertising strategy was to show off the really high end top level pro kit that helped create the Nikon mystique: creating that want for regular folks who could never afford the top level stuff, but they they would gladly purchase kit further down the product food chain. Did Nikon make that much income selling a few 400/2.8 lenses versus say millions of 80-200/4 zooms? This was a successful marketing strategy.

But times have changed. More people want instant speed for sharing thier images over having a photographic kit ecosystem. What should keep executives of camera companies awake at night is the changing habits of younger generations. How many younger people will go through their entire lives without ever owning a real camera, but still produce a zillion images along the way?



Mar 02, 2017 at 10:52 AM
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