Digital Cameras - UK - May 2008

SUMMARY

Abstract

This report presents a review of the UK digital camera market and analyses the two key types of camera that can be found in the market, compact and SLR, as well as other digital camera units.

It can be considered as a revision to a previous report on this market produced in May 2006, although it differs in that this report excludes photographic accessories  the exception being lenses purchased as part of a package when buying a digital single lens reflex (SLR) camera.

Accessories are excluded unless they are provided as part of a package when purchasing an SLR camera, many of which are commonly sold without a lens. Accessories and services related to the sector, such as processing, are excluded.

Key themes of the report:

• Can digital cameras continue to increase in popularity?
• Is there a slowdown in the market?
• What remains the priority for manufacturers and consumers?
• Do lower prices encourage trading up?
• Who is more likely to buy a digital camera?

TABLE OF CONTENTS

Table of Contents

• Issues in the Market
• Main issues
• Definition
• Abbreviations
• Market in Brief
• Growth continues although market shows signs of a slowdown
• Consumers benefit from innovation and lower prices and trade up
• Tightly contested market
• Promotional efforts move towards more focused strategies
• Consumers represent a complex market
• Internal Market Environment
• Key points
• Digital cameras continue to prove popular although there is evidence that the market is becoming saturated
  • Figure 1: Percentage of adults who own a digital camera, 2003-07
• Slowdown in male and youth market is of particular concern
  • Figure 2: Digital camera owners, by gender, age and socio-economic group, 2003-07
• Impact of smartphones
• Camera phones and younger consumers
• Mobile phone photography continues to evolve
• Falling digital prices stimulate sales...
  • Figure 3: Average prices (Compact and SLR), 2003-07
• ...although single-use cameras (SUCs) remain a cheap and cheerful rival
• Seasonality continues as a factor in the market
• SUCs lose out to ever cheaper digital devices
  • Figure 4: Segmentation of the camera market, by value, 2003-07
  • Figure 5: Segmentation of the camera market, by volume, 2003-07
• Broader Market Environment
• Key points
• PDI growth is helpful although relationship may be weakening
  • Figure 6: PDI, consumer expenditure and savings, 2003-13
• Middle-aged bulge should bring market opportunities
  • Figure 7: Trends in the age structure of the UK population, by gender, 2003-13
• Increased penetration of PCs will help market
  • Figure 8: Household ownership of PCs, 2002-07
• Growing penetration of broadband also presents opportunities
  • Figure 9: Percentage of adults with access to broadband and dial-up Internet at home, 2003-07
• Growth in one-person households could stimulate sales
  • Figure 10: UK household sizes, 2003-13
• Competitive Context
• Key points
• Digital cameras -- potential to complement from the wider increase in leisure expenditure
  • Figure 11: Consumer expenditure on selected leisure goods and activities, 2002-07
• Spending priorities favour leisure
  • Figure 12: Expenditure priorities, 2007 and 2008
• Competition from mobile is more of a threat
  • Figure 13: Percentages of mobile phone owners that have, and use, their built-in camera function, 2005-07
  • Figure 14: Types of cameras used, June 2007
• Single-use cameras remain a significant feature of the market
• Strengths and Weaknesses in the Market
• Strengths
• Increasing adoption of digital technology
• Trading up by consumers within camera sector
• Innovation by manufacturers
• Demand for more advanced features
• Retailer efforts to stimulate sales
• Weaknesses
• Impact of falling prices
• Competition from both manufacturers and retailers
• Increasing saturation of camera market
• Competition from other portable devices
• Changes in consumer preferences
• Market Size and Forecast
• Key points
• Price erosion hits the digital market
  • Figure 15: Forecast of UK retail sales of digital cameras, by value, at current and constant 2008 prices, 2003-13
• Average prices continue to fall
• Figure 16: Average price of digital cameras in the UK, 2003-07
• Segment Performance
• Key points
• Megapixel mania moves market upward
  • Figure 17: Volume sales of digital cameras, by image capability, 2003-07
• Compact digital units dominate although digital SLRs show the strongest advance
  • Figure 18: Volume sales of digital cameras, by type, 2003-07
• Market Share
• Key points
• Manufacturers fight for business...
  • Figure 19: Estimated volume sales of digital cameras, by manufacturer, 2007
• ...with some choosing to exit
• Compact segment is the most contested...
• ...while digital SLR remains focused on optical specialists
• All change in the retail sector
  • Figure 20: UK retail value sales of digital cameras, by outlet type, 2003-07
• Trade views
• Brand Communication and Promotion
• Key points
• Fall in promotional expenditure hints at signs of market maturity
  • Figure 21: Main monitored media advertising expenditure on digital cameras*, 2003-07
• Manufacturers dominate although degree of interest varies
  • Figure 22: Main monitored media advertising expenditure on digital photographic equipment, by top ten advertisers, 2003-07
• Some manufacturers move towards promoting individual models
• Press advertising dominates while television is on the wane
• Figure 23: Main monitored media expenditure on digital photographic equipment, by media type, 2003-07
• Companies and Brands
• Canon (UK) Ltd
• Fuji Photo UK Ltd
• Kodak Ltd
• Sony UK Ltd
• Nikon UK Ltd
• Panasonic
• Olympus Optical Co (UK) Ltd
• Casio Electronics Co. Ltd
• Ownership of Digital Cameras
• Around of half of all adults now own a digital camera
• Figure 39: Digital camera ownership, 2006 and 2008
• Laggards holding onto film are typified by women and older adults
• Digital Camera Usage
  • Figure 40: Digital camera usage, February 2008
• Getting consumers snapping
• A nation of amateur photographers
• Occasional amateurs and professionals both retain preference for film
  • Figure 41: Ownership versus skills in digital camera usage, February 2008
• Appendix -- Digital Camera Ownership
  • Figure 50: Digital camera ownership, by gender, age, socio-economic group, marital status, presence of children, working status, household income, tenure, region, ACORN category, media usage, supermarket usage, household size, car ownership, detailed lifestage groups and terminal education level, February 2008
• Appendix -- Who Uses Digital Cameras
  • Figure 51: Digital cameras users, by gender, age, socio-economic group, marital status, lifestage, presence of children, Mintel's Special Groups, working status, household income, tenure, region, ACORN category, media usage, supermarket usage, household size, car ownership, detailed lifestage groups, age/socio-economic group and terminal education level, February 2008