Digital services complement traditional photography

Digital services complement traditional photography

Allene Symons

Digital services are starting to blend into the typical photo consumer’s habits, now that more families are discovering user-friendly options, such as copy-enlargement kiosks for sharing and enhancing photos. Once a rarity, these are becoming a standard fixture among retailers with a serious commitment to photoprocessing and photo products.

All CVS stores with one-hour labs now have Kodak Picture Makers– that’s more than 2,500 units now, and CVS expects to have more than 3,000 units by the end of the year. At Walgreens, all but seven stores have Picture Makers, reported spokeswoman Carol Hively. “It has been very successful. We are beginning to see that the customer understands what it can do.”

Picture Maker is not the only model in the marketplace. Fujifilm offers its Aladdin, while Pixel Magic (which provides equipment for Eckerd) offers Photo Ditto.

All of these brands are positioned for the day when drug chains are ready to take the next leap by adding dedicated phone lines to the kiosks and, bingo, connectivity exists between the store and a customer’s Internet account. Until that day (or unless one-hour labs prove to be the conduit), kiosks are already capable of accepting many forms of media from film, prints and flash cards to negatives, disks and CDs.

Attracting photo customers

The process of consumer education comes before critical mass. Longs Drug Stores category manager Dave Cahoon observed: “These kiosks provide a self-service component of making prints and enlargements as well as offering some digitization capabilities. It allows the customer to experiment on their own in the store.”

That kind of experimenting is a first step toward converting photographers to try even more ways to utilize their favorite photos. “The great thing about digital services is that it carries a potential benefit of increasing picture-taking and sharing that is additive, not in lieu of,” explained Eastman Kodak’s Carry Briddon, general manager of sales strategic accounts and vice president of consumer imaging. Briddon pointed out that for the past two years, Kodak has focused on easy ways for customers to share their photographs. “Since there is evidence that sharing pictures has a direct impact on people taking more pictures, Kodak is working hard to build consumer awareness and drive trial and usage for the core of Kodak digital services,” he said. That includes Picture Maker, Picture CD, Kodak and AOL’s ‘You’ve Got Pictures” and Picture Disk. This array of digital services is offered through Kodak’s Qualex outlab services. In most cases, comparable services are available through Fujicolor.

One of the effects of incremental growth in outlab digitization–that is, when traditional silver halide film is processed into CDs, disks or as uploads–is a rise in the average processing order at retail. As Cahoon of Longs noted, this has driven increases in both economy and premium processing business. Hively of Walgreens pointed out: “We look at digital services as incremental sales. There is definitely a lot of interest and customers frequently ask about it. It’s picking up.”

For its part, CVS plans to offer several promotions on these products throughout the year. It also plans to roll out several new offerings this summer, with more details to be announced this month.

So far, Briddon reports that approximately 5 percent of all customer orders received by Kodak’s Qualex photofinishing subsidiary include Kodak digital services. Consumer awareness is still low in terms of the availability of services, and functional awareness (knowing what the service is and how it actually works) is even lower. Building awareness of Kodak’s digital services is a primary objective of this manufacturer’s advertising and communications plans. Those plans include the new Kodak Picture Center, an interactive “electronic salesperson” slated to arrive in stores this summer. It will guide the customer through choices and generate a bag with tracking information.

A key benefit of the new Picture Center kiosk is the ability of retailers to educate individual consumers about new digital technology at the time they drop off film. During recent market tests, the percentage of consumers selecting incremental digital services was significantly higher at retail locations equipped with Kodak Picture Center kiosks compared with those that were not, according to Briddon. “Also, new innovations in digital mini-labs and on-site upload capability are enabling one-hour photo outlets to participate in this rush to provide consumers with digital services,” added Briddon.

On the horizon

Meanwhile, Fujifilm USA also is gearing up for more digital services business. It recently introduced Fuji-color CD in the U.S. market, offering consumers another way to view and edit their photos. Fuji has also re-designed its online Internet photo service,, and added a more powerful navigator to expedite the loading and viewing of consumers password-protected photos. For its copy-enhancement kiosk Aladdin, the product line has been expanded with two new space-saving models and new software. The new models are part of the Aladdin Picture Center concept, which allows a chain of connectivity: Aladdin accepts input from print, film and digital sources, or allows transfer of images to Fujicolor CDs.

Pixel Magic (Photo Ditto) is now offering its fourth generation product, which includes among other new features a cropping tool (and text-moving tool) that is operated with the tip of a finger. This is a good step in the direction of making these services easier to understand and use.

Drug chains can’t afford to be complacent about their share of these new services. “Consumers have been exposed to print-to-print services and drug stores are now realizing that they need to be poised to offer services to handle those expectations,” observed Laura Oles, vice president of marketing for Pixel Magic. “If you lose customers’ digital business, you risk losing all their business.”

Cahoon at Longs cited the threat from new directions. “Internet-based processors such as ophoto or are, in my opinion, targeting traditional silver halide processing, which has been the mainstay of our business,” said Cahoon. “While they give the impression that they are focusing on digital, I believe that they are really after the traditional business. We will need to consider ways to protect our turf against this new niche.”

So far, although the U.S. film industry encompasses approximately 800 million rolls of film a year, the total industry yield for current digital penetration is still a small percentage. Nonetheless, as Briddon pointed out, “Through building consumer awareness and generating trial and usage, the percentage of total orders requesting digital services has the potential to grow to double-digit percentages by the end of this year.”

With vigilance in the face of interlopers, drug chains will be in a good position to realize those numbers.

COPYRIGHT 2000 Lebhar-Friedman, Inc.

COPYRIGHT 2000 Gale Group