Eastman Kodak Company: Funtime Film - SPARCS

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more and more films. Moreover, the second objective is increase average households’ film usage rate from 15 rolls per year to 20 rolls per year in two years time. The strategy of Funtime is pretty interesting. Funtime has a lower price compared with other products of Kodak and sells only in off-peak time. It might be a good idea to sell it in a low price because it attracts more customers. Although I agree that your company has history, high technique, and knack, the products of your company are expensive in spite of having no special merit. According to the data of testing many films, the prices of your products are unreasonable, because the other good quality films of other companies are sold in lower prices. If you provide a good product in a lower price, then it can be a good chance for you to gain many customers. But I found some problems in your situation. Your main customers are consisted of loyal customers and samplers who rely heavily on Kodak. Equally, they are stable customers and they will not change their films to other companies' easily, so Funtime may have no advantage to hold your existing customers. Consequently, you need to expect new customers come from other companies to Kodak. Let’s briefly assume that your company sells only Gold Plus now. Because Funtime has a lower price - 3 -
than Gold Plus, if Gold Plus users change their films to Funtime, you need new customers. In fact, the number of new customers has to be about 0.25 times of the number of the 'movers' to compensate for loss. If 10% of Gold Plus users change their films to Funtime, 2.5% of the number of Gold Plus users has to be filled with new customers from other companies. Furthermore, in turn, it requires 1.8% of market share increase. As you know, Fuji's market share is 11% and Polaroid's 4%. Do you think you can change the mind of one-tenth of the customers of Fuji and Polaroid? Critically, you don't advertise. I think it's too hard for you to get these amounts of new customers from other companies. [Appendix 2] Kodak Company can pursue other action plans. Firstly, you can reduce the advertising cost. Secondly, you can sell films to other countries like China, India, UK, etc. Thirdly, you can develop new film for children who are potential customers. Fourthly, you can give ‘premium customers’ more special services. I recommend you to do the ‘premium’ strategy. This strategy is based on Bowling Alley strategy 1 and targeting specific classes. This strategy is targeting on 1 Moore said that it’s the most important thing for company to target on a specific class of customers to enter a new market. The success of that class causes a chain reaction to another - 4 -
Page 1 and 2: Eastman Kodak Company: Funtime Film
Page 3: By the evaluation of the consumers,
Page 7 and 8: Exhibit 1. SWOT analysis Internal S
Page 9 and 10: Exhibit 3. Porter’s 5 forces Fact
Page 11: Appendix 2. Funtime evaluation Gold

Eastman Kodak Company: Funtime Film - SPARCS

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