Disruption in the maketplace

Innovation breeds innovation and disruption to the established market place can lead us down roads that we never imagined.

When we look at the art that is photography – originally established in the 1800s, it changed the way we looked at pictures and the way that pictures were made.  As it developed, the quality got better.  Technology around pictures enabled pictures to get better and better and be transported wider and wider through the print media.  Cameras and film got to a point that the middle class could afford them.

Massive business empires were created around photos.  Cameras and film was the domain of Kodak, the printing business was massive and a 1 hour turnaround came at a price.  Fun was had with polaroid but the film industry looked unstoppable – that was until 1999.

Disruptive technology – or technology that changes the marketplace, provides alternatives where people didn’t even know they wanted an alternative has been around for a long time.  When big computers became small computers, when horses gave way to cars, when the humble child worker gave way to mechanisation (and child welfare laws – at least in the West).

And so, film gave way to digital.  Slowly at first.  Kodak, in fact created the first digital camera in 1975 but it wasn’t until 1999 and Nikon did a commercially available camera hit the market place.  Like most new inventions, it needed time to develop, needed customers to get used to the technology and ultimately to take it up in large numbers.

And they did.

The rate of change was astounding.  In 1998 no one owned a digital camera and in 2012 the king of the film industry, Kodak was in financial administration, personal digital cameras were in the hands of almost everyone – if not a stand alone camera, a camera in their phone and professional cameras were providing better pictures than the film cameras ever could.

It also didn’t take long for the support services to support digital photography.  The printing shops that survived quickly offered digital print services but importantly, the web – the initiation of the social web sprung up to share photos.

Early blogs could upload photos, photos could be shared via services like ICQ.  Soon we saw services like Flickr emerge.  More recently we have Facebook, Instagram and Pinterest.

The kings of the digital age have been Canon and Nikon who dominate the DSLR market and Apple and Samsung who dominate the smartphone market.  Google, Yahoo! and Facebook have made their name by publishing photos.

The losers?  Kodak, mass media and in a strange way – the professional photographer.  The photographer that could not keep with the times, change their business model saw their revenue stream dry up.  Additionally the decreased cost in publishing photos and learning to be great at photography has seen the revenue stream decrease and the competition increase – but that is an entirely different topic to post about.

The winners demonstrated an ability to innovate in their field, a will to invest and drive through the emerging stages of their product lifecycle and a willingness to educate their customers on what they really should want.

As a result, this disruptive technology became the Sustaining Technology – or in other words, what everyone uses and what we expect.  Where the money is made.

Web 2.0 was the perfect platform for photo sharing.  The internet was fast enough for photos and storage space wasn’t an issue.  It offered a way for people to connect as they never had the power to do before.  Over the past decades, people could only communicate over a distance via voice.  Now sight was added to the mix.  Social media’s instantaneous nature, the 24 hour news cycle, the 24 hour shopping cycle and the connected nature of our lives worked perfectly for digital photography.  You still could see what your friends and family could see in faraway places.

It could also hang round, be easily accessed for years at the touch of a few keys.  It became more secure than the film.

And it ended dinner parties centered around a slide show.  Conversations now centre around the experience, as people have already seen the pictures.

But as we have seen  in the past, this ground that Nikon et al have can be eroded by the next revolution.  We see these companies evolve their products, but they must keep an eye out for the next people to to them, what they did to their counterparts over the last 15 years.

Undoubtedly, the social web will assist this.  It enabled the rise of digital photography.  Who knows where it will take us next.

 

Sam Tickell

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One thought on “Disruption in the maketplace

  1. I’m glad someone brought up photography. The Kodak case study is a good one, it’s almost text book for the creative destruction idea we have been discussing.

    In the UK over the past few months we’ve seen the closure of a number of big retail companies that feed into the discussion around creative destruction: HMV (basically our oldest record store, but it’s been more of a music + general entertainment place for many years – films, games etc.), Blockbuster (video rentals) and Jessops (high end camera equipment and photographic processing).

    No doubt you can google to find more on each case study, but let’s look at the Jessops example as it links to yours so well: the ubiquity of decent camera phones, the decline of printing photographs, and the rise of Amazon as the destination to buy expensive electrical items at reduced cost – these have all done for Jessops.

    One of the things that Jessops was great for was choosing kit – hands on demonstrations with people who knew the kit. You’d even get a test drive! You’d need one if you were going to spend thousands on a new Nikon or Cannon D-SLR. But then folk just went and bought the kit on Amazon when they’d decided.

    The writing was on the wall for Jessops for a while. But how does this effect Nikon and Cannon? And what innovative steps do they need to make to keep themselves shifting cameras? What about the threat to their business caused by other trends? Are people buying premium compacts? Or are people seeing photography in a more disposable way and finding that a smart phone is just the job?

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