The constant stream of young customers at Capital Camera, a small but incredibly busy store in Delhi’s Nehru Place, hasn’t thinned. Through the year, even on weekdays, they trooped in, eyed the dSLRs wistfully, asked questions about pixel and zoom and tested the compact cameras. Most left without buying anything. That changed in the second week of October. With Diwali round the corner, sales manager Advait Kumar had enough business to keep him occupied at the cash register through the day, rather than stand behind the counter passing out the same cameras to every potential shopper.
More significantly, many of the sales were of dSLRs, not the more affordable and popular gifting option: compact cameras. “For compact cameras, people come in to enquire about prices and then buy online. It is different with SLRs,” says Kumar. According to reports, the try-and-buy brigade picked up 45,000 dSLRs during September-October this year, 10,000 more than the same time last year. Compact camera sales, on the other hand, dropped from 800,000 units to 600,000 over the same period.
It’s a very worrying statistic for camera companies but none of them sees it as a sign that interest in taking pictures is waning. Far from it. A camera has become a ubiquitous accessory of modern life. It is now always within reach when family and friends gather, it always tops the five-things-I-always-pack holiday list, and the first potted bloom in the balcony usually has someone peering through a viewfinder. That is not only because a camera is now part of almost every mobile handset but also because entry-level point-and-shoot digital cameras have become ridiculously cheap. “Before 1998, about 3 million cameras were sold annually around the world,” estimates Alok Bharadwaj, senior vice-president, Canon India.
That’s less than the cameras sold in India alone last year. Camera manufacturers estimate that about 3.3 million compact cameras and 170,000 dSLRs were sold in India in 2011. The expectation is that about 225,000 dSLRs will be sold this year, a 30% y-o-y growth (albeit on a smaller base). But where the camera-phone has introduced a new breed of wannabe photographers, it is also proving to be a formidable enemy of the camera makers — compact camera sales have fallen this year. Of course, camera companies dismiss this year’s blip as a consequence of the general economic slowdown but there’s no denying that the threat from increasingly sophisticated smartphones looms large. The three biggest players in the Indian camera market are all Japanese — Sony (34% market share by volume), Nikon (25%) and Canon (14%); minor players like Fuji and Samsung make up the rest.
All three companies have patented technologies, which they faithfully communicate to the consumer, but the variations in picture quality are not too discernible — for an amateur, at least. In other words, there is no real difference between the brands for most first-time buyers. “Most customers walk into a store with a vague idea of what they want,” says Sunil Nayyar, senior general manager, sales, Sony India. “Then it is our responsibility to take ownership and sell them a product that suits their needs.”
The flash bearers
The new dSLRs and compacts are using state-of-the-art technology
to give buyers a more professional experience
So, if it is technology that created this market, it is technology that’s driving its momentum and shaping its future, and camera companies know this. “Even at the entry level, there have been significant technological improvements,” says Canon’s Bharadwaj. The resolution, for instance, has gone up rapidly to 16 megapixels (the highest is 23), most cameras now have the ability to take 3.9 frames per second (fps), and the humble 2x optical zoom has now gone up to an astounding 35x. “This means that you can take a photograph of someone 35 metres away and make it look like the person is only 1 metre away.”
But point-and-shoots were the low-hanging fruit for the industry. “We have had a sweet time in the past four or five years,” says Sony’s Nayyar. “Now, the market has become mature. Growth rates aren’t going to be as high as they were.” So, manufacturers are wooing customers with cameras that can perform amazing feats in photos and videos and — once again — pushing the technology angle.
Market leader Sony is betting big on the migration of customers from entry-level compact cameras (about Rs.5,000) to more sophisticated models. “High zoom will be big for us,” elaborates Nayyar. “In fact, we have a new segment — compact high zoom. This is for people who bought a basic camera three or four years ago, and who want to get better photos.” Prices start at about Rs.13,000 and the idea is to keep the body slim and compact without compromising on the zoom functionality.
In April, Sony unveiled 34 new digital cameras, priced between Rs.5,500 and Rs.28,000, emphasising features such as optical zoom, steady shot, better low-light performance and fast auto focus. The focus was determinedly on the amateur photographer who wanted better quality images. The latest launches, though, are clearly targeted at serious photographers.
The dSLT Alpha99 is Sony’s flagship camera, priced at nearly Rs.1.8 lakh. It’s a 24.3 megapixel still camera that also has HD video shooting facilities and is the world’s first camera with dual autofocus (which allows accurate, ultrafast autofocusing). Then there’s the DSC-RX100, which has the world’s largest image sensor in a compact camera. The 20.2 megapixel camera is priced at around Rs.35,000. The company is also keenly promoting its new DSC W series, which comes with a sweep panorama feature that allows photographers to take an extremely wide angle shot by pressing the shutter down and sweeping the camera over the scene.
Needless to say, Sony isn’t the only camera company pulling out the stops when it comes to high-tech gadgets. “Price is a challenge in the Indian market,” concedes Hiroshi Takashina, MD, Nikon India. “At the same time, they [Indian consumers] demand a superior quality of products.” The company’s latest launch is the D5200 entry-level dSLR, timed for the festive season. The Rs.47,000 camera includes a swing-out LCD screen to facilitate self-portraits, and can connect with smart devices, which can receive images and even be used for remote operation
While Nikon is the undisputed market leader when it comes to dSLRs (55% market share), Canon is focusing on strengthening its grip on the compact camera market. In September, the company launched three new models; while the PowerShotS110 comes with wi-fi, the SX50HS is the world’s first camera with 50x optical zoom. The EOS 6D is a 20.2 MP dSLR with wifi connectivity. Earlier launches this year include the SX500 that features a telephoto zoom of 30x, but is a compact camera.
While consumers are buying the better technology-better images story (witness the spike in dSLR sales), fogging up the image of a market where consumers are rushing to buy cameras is the smartphone. With the likes of Nokia Pureview, which has a 41 MP camera, Sony Xperia SL (12 MP) and the more sedate iPhone5 and Samsung Galaxy S3 (8 MP each), phones are being bought as much for their camera as for other features. The biggest advantage is instant connectivity — users can upload images almost instantaneously. “Customers feel if a cellphone camera can do 80% of a camera’s job, it’s good enough,” admits Nayyar. “This is a challenge.”
To counter that, companies are launching cameras with connectivity. The Nikon CoolPix S800c is a 16 megapixel Android-based camera that also has bluetooth. Samsung Galaxy Camera is similar but more expensive (Rs.40,000 compared with Rs.21,000 for the Nikon offering). Canon, too, has PowerShot models that can connect directly with iOS and Android devices, print wirelessly and add GPS data on images.
Connectivity aside, camera companies increasingly are finding that younger customers — the average camera buyer is now 25-27 compared with 40 a few years earlier — like gadgets that offer a little extra. That’s why companies such as Sony, Nikon and Canon are banking on HD video capability to be the next game changer. Most companies are loading even point-and-shoot cameras with near-professional level video recording capability and tom-tomming the fact that feature-length movies can be made with these devices. “Arming dSLRs with HD video has helped open up new markets, especially among professional users,” says Canon’s Bharadwaj. Movies such as Stanley Ka Dabba, 7 Khoon Maaf and That Girl in Yellow Boots were shot with such cameras, which are especially useful for outdoor film shoots where large crowds gather. “It saves the hassle of big sets with large cameras and equipment.”
Still, cameras can be a tough market to crack. The serious photographer won’t switch brands easily, while the amateur will be easily swayed by features and, especially in India, price. How do brands stand out in the crowd, then? By investing heavily in marketing and distribution. Sony India has a total marketing budget of around Rs.450 crore, of which cameras get a substantial share. Canon’s marketing budget, too, is nothing to be sneezed at: Rs.102 crore, with Rs.40 crore for the festive season alone. Nikon, meanwhile, has earmaked Rs.150 crore for marketing and advertising in FY13, up from Rs.120 crore the previous year.
Entry level dominates but, expensive tech-rich cameras are growing faster
A big chunk of the money goes towards celebrity endorsers — the battle for compact cameras is fought through brand ambassadors. While Sony has Deepika Padukone, Nikon is with Priyanka Chopra, and Anushka Sharma promotes Canon’s compact camera range (though Sachin Tendulkar remains the overall brand ambassador). Companies are also expanding their retail presence. Canon has doubled it, (620 cities and 2,900 outlets). Sony plans to grow from 2,500 outlets in FY12 to 3,000 by end-FY13. Nikon has grown its retail base from under 2,000 outlets to over 3,000, and expects to have 3,500 outlets by March 2013. “An important aspect of distribution in India is that we are seeing significant demand from tier 2 and 3 towns as well,” says Takashina.
Whether in the metros or smaller towns, one thing is certain —the battle for marketshare will be fought on technology, not just price. Camera companies are readying for the next round — cameras that work well in low light, mirrorless cameras, cheaper dSLRs…. Their aim is the same — more marketshare — and they’re all focusing on the same differentiator — technology. While the three players will fight it out between themselves, the larger question is how effectively can they fight the common enemy — smartphones?