1. Why is Kodak losing market share? (bullet points). (1 points)
2. What are the potential risks and benefits of launching Funtime (for Kodak, NOT
for the consumer)?
3. Provide non-financial risks and benefits (for Kodak, not for the consumer). (1
point)
4. Recommendation
Why is Kodak losing market share? (bullet points). (1 points)
Kodak is losing market share for several reasons:
•Negative rumors regarding a price cut on Kodak’s film causing a negative image of
the company
•Due to the legal constraint in the 1921 consent decree still in place at the time,
Kodak could not sell film on a private label basis, thus preventing Kodak’s
competitor’s film to be more available. (Agfa and 3M sold to consumers as a
branded product and to firms as a private label)
•More competitors are entering the market and capturing market share faster than
the overall market is growing. Kodak’s newest competitor, Polaroid, entrance to the
market in 1989 and gaining market share, thus taking away from Kodak’s market
share
•Limited consumer product knowledge created little differentiation between
competitors, causing consumer to use price as the only benefit when choosing
which product to purchase. Therefore, Kodak’s higher priced product suffered in
comparison to its competitors.
•A similar product positioning strategy between Kodak and Fuji further confused
customers in terms of choosing a ‘better quality’ film. Increased competition with
little product distinction allowed Fuji to capitalize on the film market.
1. Complete the following table. (2 points) Assume all Kodak sales are Gold Plus and
all Fuji sales are Super G.
1. What are the potential risks and benefits of launching Funtime (for Kodak, NOT
for the consumer)?
1. Provide non-financial risks and benefits (for Kodak, not for the consumer).
(1 point)
Risks:
•By removing the super-premium brand Ektar, Kodak potentially loses market share
in this category to Fuji’s super-premium brand Reala.
•Funtime being a lower margin product could initiate a price war within the
economy brand tier which would in turn further institutionalize the concept that
film is a commodity, this would remove Kodak’s ability to market their premium
brands has higher quality products.
•A seasonal offering with no advertising does not guarantee the demand to sustain
the product extension.
•Kodak’s Funtime strategy– lower priced film holds potential for creating confusion
among its current target market. The inadequate advertising strategy could
adversely affect current target markets by not establishing a new segment for the
