13 Jun Gone in a flash
By Andrew MacKenzie
In 2012, Kodak, a 124-year-old global leader in the photography sector filed for bankruptcy. The reasons behind its failure are a tragedy of ignorance and arrogance. Just five years earlier, in 2007, the company boasted a share price of $90 and was arguably the dominant brand in the category, it’s famous red and yellow branding, a household name across the world. Fast forward to 2012, and Kodak’s share price crashes to a scary 76 US cents.
But why the collapse? There are three reasons:
The first was the arrival of digital technology and the digital camera in particular. People could snap thousands of photographs, view them instantly, delete what they didn’t like and store them all conveniently on a hard drive. There was no cost for expensive film or processing, and most importantly, no waiting. The age of instant gratification had arrived.
The second was the arrogance of the Kodak top brass. They foolishly believed that its customers were loyal to the point that they would not desert their brand or product offering or the age-old technology that was film and film cameras. Even after Kodak’s competitors launched aggressively into the new digital technology, Kodak refused to adapt, and by the time they did, it was simply too late, and they had lost to much market share to Sony, Fuji and Nikon.
The third and possibly most important reason for the collapse was that Kodak stopped listening and understanding what its customers wanted. A company’s ability to not only listen to customers but also understand their changing lifestyles determines success or failure. This target market understanding is a continuous marketing prerogative.
The lesson all entrepreneurs and brands can learn from Kodak. Keep an eye on the future. Is your business adapting to fulfil the needs of your clients as they shift their buying and lifestyle behaviour? It’s time to adapt or fade away, after all, things are changing as quick as a flash.