mind the gap: blog
Camera Market Returns from Four-Year Ride Bruised, but Wiser
Digital cameras have it rough these days. Statistics being released from numerous industry sources are continually quantifying the decline in digital camera sales and shipments over the past years, which at this point has become very real to many photographic industry players. Competition in the marketplace from devices like smartphones, coupled with shifting consumer habits, have forced longtime players in the camera market to reevaluate their stances and product lineups in a frantic effort to “innovate or die.” With CIPA (Camera & Imaging Products Association) reporting a 60% drop in fixed-lens camera shipments in 2013 compared to 2010, it is safe to say that this innovation has not come easily to companies deeply entrenched in the way things used to be.
But what shape is the camera industry really in, and how has that shape changed over these years? While CIPA’s report tracks shipments of digital cameras worldwide, gap intelligence specializes in tracking the retail presence of digital cameras. Despite these differences, a similar picture of the camera market is painted, and although the industry is indeed declining compared to recent years, gap intelligence retail data shows that it has arrived to much the same point that it was in 2010.
Using gap intelligence historical data to look at trended retail data for digital cameras from 2010 to 2014 shows us that there were 634 total placements in retail pre-Spring reset 2010 and 633 total retail placements at that exact same time in 2014. This decline of one camera is a far cry from the dramatic doom-and-gloom headlines seen recently, but this view admittedly does negate the positive growth achieved by the camera industry between these two points in time. Now essentially back to square one with a similar retail presence, the digital camera world is a very different place these days than it was four years ago.
In the good ol’ days (read 2010), basic compact and ultra-compact cameras ruled the world of retail with a combined presence of 76%. Camera-makers could count on shoppers purchasing these camera-types because of a need to capture pictures. An ultra-compact camera was the primary way that most people, regardless if they were passionate about photography or not, would snap a photo, and camera purchases came largely from necessity rather than excitement. It is these same reluctant shoppers that now reach for a smartphone to fill that need, resulting in the steep reductions of ultra-compact and compact segments, which combine to only a 53% presence on today’s retail shelf.
Amid the waning popularity of basic point-and-shoots something interesting has happened. Chains once fearful of higher price tags are now pumping advanced camera models onto their shelves in an effort to showcase items capable of things beyond just snapshots, which has caused a tremendous rise in the average selling price of a camera from $302 in 2010 to $456 in 2014. Interchangeable lens camera types now make up 31% of the retail shelf compared to just 16% four years ago, and megazoom bridge models have doubled in presence from 8% to 16% as smartphone-snappers realize they are missing zoom on their vacations, and in everyday life.
With that, it is evident that photography is not going to vanish anytime soon, neither in art form nor in hobby, but is instead going through a rough cycle brought on by the historical comfort that vendors once had. As current estimates point to over 380 billion photos being snapped annually, it seems our passion for photography is stronger than ever, which is the shining light that our smartphone obsession has provided. Interestingly, this statistic breaks down to more pictures being captured on a daily basis than were taken during the combined 100 years following the invention of photography.
So as it seems, we do not really hate photography as much as camera industry numbers allude to. If anything, the market was not providing enough of what was truly needed, allowing smartphones to pick-off the low-hanging fruit of basic compacts, and foster growth of REAL cameras. Now manufacturers are making formidable strides to make these advanced models fit in with our connected lifestyles, but until that perfect sweet spot is found, the camera market may have more dismal numbers to report.
Vendors Find Growth Opportunity in A4 Business Inkjet AiOs
Amid market disruption and a continued decline in home printing, inkjet vendors are working hard to change business customers’ perceptions and increase demand for business inkjets. In the SOHO market, customers have historically associated inkjet AiOs with home and photo printing, as well high costs and slow speeds. On the other hand, these customers who are looking for a printing device to use in their office are still inclined to head towards the laser aisle. In order to change demand for business inkjets, vendors are increasing investments in the segment at the retail level.
Inkjet AiO vendors aim to take share away from small office laser MFPs by offering stronger-configured inkjet AiOs that promise both cost and speed advantages. The move towards generating demand for SOHO devices is apparent at the retail level and is illustrated using gap intelligence’s new PowerPivot Pricing & Promotions reports. As shown in the charts below, all inkjet segments excluding A4 business inkjet AiOs have declined or remain unchanged year-over-year from March 2013 to March 2014. In contrast, retail placements for A4 business inkjet AiOs have increased by 16% year-over-year, demonstrating that vendors and their retail partners expect demand to shift from home/photo to business devices.
Following a shift in retail assortments, vendors are investing more on advertisements for A4 business inkjet AiOs, primarily with instant savings incentives. Leveraging gap intelligence’s new PowerPivot reports, our retail data indicates that ad counts at national retailers including Best Buy, Office Depot, OfficeMax, and Staples have significantly increased year-over-year by 34.6% from 130 ads in March 2013 to 175 in March 2014. Best Buy demonstrated the strongest growth in A4 business inkjet AiO ad counts, with a year-over-year increase of 63.6%.
The strong growth in ad counts is attributable in part to HP’s notable investments in its Officejet Pro X series’ retail presence. Through the introduction of its PageWide MFPs, HP has positioned itself as a leader in establishing credibility for high-speed business inkjets. The more robust MFPs are designed to target laser installments with their faster print speeds and lower TCO. With the launch of these devices, HP has helped to legitimize page wide array technology that targets business laser MFPs. To the surprise of some industry watchers, HP has supported its Officejet Pro X devices with a strong retail presence despite price points that are significantly higher than any other retail AiOs.
Looking forward, vendors and retailers are expected to continue their focus on A4 business inkjet AiOs as an avenue of growth. Though HP has emerged as a pioneer in the segment, vendors such as Epson have been quick to follow its competitor’s strategy. With that, Epson is expected to launch business inkjet AiOs that feature the vendor’s PrecisionCore technology, a high-speed inkjet platform that utilizes chips based on the company’s Micro Piezo printheads and micro-electromechanical system (MEMS) manufacturing. Although Epson has not yet introduced a page wide array printhead, the vendor suggested that it plans to offer a technology that rivals HP’s Officejet Pro X series in the future.
A Spring gappy Tumblr Blog 3
New quarters bring new challenges to most of us gappers, and this quarter was an especially challenging one for this girl. From getting back into the groove at the start of the year to wrapping up the quarter with a challenging project, this addition of gappy tumblr will focus on my personal journey in dealing with the last eventful few months.
Coming back to work in January after the holiday week off was probably the hardest…
Returning to my desk and doing my normal tasks seemed much more trivial than it was only a week before.
But after a few days and a lot of caffeine, things started coming back to me.
Before I know it, I was in the full swing of the quarter and everything was back to normal.
Sure, there were a few difficult moments, like trying to pretend I didn’t see the Broncos get destroyed during the Superbowl…
…and trying to not seem guilty of stealing food/toys off of coworkers’ desks…
But for the most part I was flying through the quarter with ease.
Then things started to change.
I occasionally had to wake up early to call other countries…
..and try to understand heavy European accents.
Followed by receiving instructions for a new project that was outside of my comfort zone.
I somewhat doubted if I was capable enough to be given such a project…
As it involved looking at sections of files that were foreign to me…
And understanding array formulas.
Mild moments of panic ensued…
I stayed late and watched my coworkers leave before me…
All the while trying to understand formulas that I had rewritten several times and still didn’t make sense…
But soon things started coming together and formulas started working.
Out of nowhere I became fearless with my new project, and made changes effortlessly.
Regardless, when the project reached the testing phase, I braced myself the worst.
But was pleasantly surprised with only a few issues that needed fixing.
Finally, it was the end of the quarter, and I realized that I’m actually capable of a lot.
And there was much rejoicing.
gap intelligence Enters the Hedgehog Market
It is with great excitement that gap intelligence announces a new addition to its category offerings with the introduction of tracking live and toy hedgehogs. With the booming pet industry, it is no surprise that gap intelligence decided to enter the market. The company will track live and toy hedgehogs at all of the major pet vendors in the retail market.
Noticing the buying power of pet consumers, gap intelligence saw that entering this industry would be a marketable endeavor. This year alone it is estimated that consumers will spend $59 billion on their pets in the U.S. The hedgehog retail report will be the first to roll out, with others to potentially follow in the near term depending on demand. gap’s retail store panel for this category will include Petco, Petsmart, Walmart, Target, and Unleashed by Petco.
gap impact summary
- Herbie the Hedgehog will be the new analyst for the hedgehog category
- A new mascot for gap intelligence will be selected to replace Herbie’s current role
- The U.S. launch of the report is forthcoming
gap intelligence will continue to post updates on this new emerging category, but in the meantime, Happy April Fool’s Day!
SCIENCE (and the healthcare industry)
Anyone who knows me will tell you that I’m a huge science goober. My time is generally split between the lab and here at gap. While busy, I absolutely love both of the things that I do. My research ventures into neuroimmunology, where I focus primarily on immunotherapy to combat glioblastoma multiforme, the most common form of brain cancer. Talk about a bridge between jobs!
Recently, all of us at gap intelligence got together to discuss new markets to venture into and naturally I championed for the healthcare and biotech industry. The healthcare industry is facing major changes in terms of information technology and management, and solutions providers are taking notice. In 2013, venture capital funding in the Healthcare IT sector totaled to $2.2 billion. What better way to tap into a $1.67 trillion US market than by harnessing the accurate and timely data capturing capabilities, as well as the industry knowledge of gap intelligence?
How much are hospitals spending on information management systems? Sentara hospitals, composed of eleven hospitals in Southeastern Virginia and Northeastern North Carolina, budgeted $237 million over 10 years for Epic Systems Corp. EHR (electronic health records), and saw a return of $53.7 million.
With the healthcare reform, concise and correct patient documents are more vital than ever. Health information management (HIM) is expected to change drastically, forcing hospitals to look at how patient-generated data is used, and how it affects patients. Big data from the influx of smart, connected, and disparate devices could very well be what pushes the entire healthcare industry to run more efficiently. Throughout the industry, big data is being touted as the future; ranging from personalized cancer therapy programs, to predictive models, which can help doctors determine health issues before they arise.
However, governance and analytic systems are far from perfect, highlighting the lack of trust between departments. IT departments don’t always fully understand how physicians and medical professionals use data, often resulting in overlapping and redundant systems. Regardless, there is a fundamental shift in healthcare: hospitals are beginning to look at data with an enterprise view and acquiring devices and software to help organize clinical informatics strategy. The problem here is bridging the gap between the healthcare industry and technology.
HP Targets Color Growth with New Products and Aggressive Pricing Strategy
It’s no secret that HP’s printing division has been very busy over the past six months. In the middle of the company’s strategic five-year-turnaround, HP is looking to strengthen its market leadership by updating its product portfolio and evolving its strategy with a focus on growing its color installed base.
The vendor has more or less completed its first objective, introducing well over two dozen new LaserJet configurations since September 2013 that provide much needed hardware improvements and lay the foundation for HP’s service and solutions-led strategy.
HP’s new LaserJet portfolio represents a very complete and competitive lineup, but the vendor certainly understands that to grow its printing revenue and profit will require a more aggressive strategy. In its most recent earnings call, HP stated that, beyond updating its portfolio, a major component of its print division’s strategy is to “invest in hardware unit placements with positive lifetime value.” In other words, HP wants grow its installed base with a focus on unit placements that offer long-term profitable supplies revenue (who doesn’t, right?). However, HP acknowledged that a difficult pricing environment is causing a decline in hardware average selling prices, presenting a challenge for increasing color unit placements without changes to its pricing structure.
Understanding HP’s long-term strategy to grow its installed base of “profitable” units, and its market view that ASPs are under pressure, it’s comes as no surprise that over the past few months the vendor has dropped prices for a large number of color LaserJets. Leveraging gap intelligence’s new PowerPivot Pricing & Promotion reports, we see that HP has lowered printer and MFP retail price points by as much as 18% and repositioned its color portfolio at a historically rare discount below many of its competitors’ color products, a move that is clearly tied to the vendor’s strategy to grow its color laser installed base. While many of HP’s color prices dropped over the past few months, the vendor made few price changes to its monochrome portfolio, which further suggests that HP is steering its customers toward color LaserJet purchases.
HP’s price drops are significant, especially in the SOHO and small workteam segments, and overall range from low-end retail SKUs up to its A3 color LaserJets with price tags approaching $5,500. As is historically the case, HP’s competitors have already begun to respond, with Lexmark adjusting prices for six of its comparable color laser printers earlier this month, with more competitors likely to follow.
These price changes provide HP with the advantage of lower hardware acquisition costs for its partners and end-users, which will likely allow the vendor to meet its strategic goal of growing its installed base – at least in the near term. It’s reasonable to expect that more aggressive hardware pricing could slow HP’s hardware revenue growth in the near term, given that the vendor will earn less for each unit sold. But, this impact will likely be justified if it results in a larger installed base that generates ongoing and more profitable supplies revenue.
With a refreshed and more aggressively-priced hardware portfolio, HP has improved its positioning and could succeed in growing its installed base. This installed base growth may help to increase the company ‘s supplies annuity, which continues to serve as one of HP’s most profitable business segments.
gap Turns 11
gap intelligence turned 11 this month. Being 11 is a BIG Deal. Birthdays are a time to celebrate and also a time to reflect. At gap we know how to work hard, but more importantly we know how to play even harder. We decided to toast ourselves at Modern Times Brewery in Point Loma in celebration of us! There was cake. There was beer. Herbie was even in attendance. As I stood and looked around the room I couldn’t help but think about my journey in becoming a proud gapper.
My journey started on October 23, 2009. It was a Friday. I remember sitting at a desk with a mix of emotions swirling in my head. I was nervous, excited, and a little scared. gap intelligence was my first “big kid” job after graduation from UC Santa Barbara. It was overwhelming to try to step into my friend’s shoes who recommended me as his replacement as a Research Assistant. I didn’t want to make him look bad. I wanted to be a superstar.
It took me a solid six months before I had any idea what I was really doing. A few helpful trainers took me under their wings and showed me the ropes. Learning the ways of Excel formulas started out quite daunting. Fast forward to present day, they are now second nature.
Over the last 4 ½ years my role at gap has changed quite a bit, and I have worn many different hats. In fact, I have even worn “crazy” hats during gapU Spirit Week. Celebrating gap’s birthday was a trip because I remember when the entire company fit into a small office downtown. As we have grown to a company of 35 employees it’s kind of wild to think about how much has changed over the last few years. I can’t even imagine how much it blows our CEO and VP’s mind when they take a second to pause and look back on where we started and where we are headed.
No matter how big we get I know that we will take a moment to celebrate ourselves every March. Candles will be blown out and wishes for another successful year will be made. CHEERS to us and this milestone! Happy 11th Birthday, gap intelligence!
Using PowerPivot to View the Dynamic TV Marketplace
While playing around with our new PowerPivot TV file recently, I found myself thinking about the upcoming 2014 TV refresh season, and the increased concentration by the manufacturers on 4K TVs. How does the Ultra HD market look compared to the “regular” HD market, and will that change in the months to come?
Retail Shelf Share
The new PowerPivot model makes it easy to calculate retail brand presence. With the simple click on a filter, I was able to view a chart that shows current retail shelf share for all non-4K TVs. What I found wasn’t surprising: Samsung leads the market with 23% of the retail shelf, followed by Vizio with 22% and LG with 11%.
But when I look at the same data from a 4K-exclusive view, I get a different picture. Sony currently captures the majority of the market with a 37% shelf share, followed by Samsung with 21% and LG with 18%. Sony’s current position coincides with the company’s plan to focus on 4K TVs during the coming year, but does not yet take into account upcoming releases by Samsung, LG, and Vizio, among others, which could shake up the shelf with lower-priced models.
In order to see if retail advertising data followed the same pattern, simply switch over to the Ads Analysis tab and apply the same filters. Standard HDTV ad share for the first two months of the year shows that Samsung holds 39% of all retail print ads, followed by 10% of ads that don’t list a specific brand, and then 9% each for LG and Sharp. This ad share overview follows the same pattern we saw in weighted shelf share placements, with the exception of Vizio, which falls back in ad share to only 4% of all ads placed.
In contrast, only five brands placed Ultra HDTV print ads during the beginning of the year, with Sony again taking the top share at 39%, which it shares with Samsung. LG follows with 13% of all UHD ads, with Seiki and Sharp rounding out the count.
It will be particularly interesting to watch how shelf share and ad placements change over the next few months as more 4K TVs are released in the market. Staying on top of these changing trends is made easier by using the new PowerPivot reports with their preset chart templates and historical data built in. When Vizio enters the Ultra HD market with its new line of low-priced models, for instance, it will take only seconds to see whether or not the company continues increases its ad share to push the new technology. Similarly, Samsung already advertises its Ultra HD models as much as Sony does, but will its Ultra HD shelf share increase proportionally? A click of the button is all it will take to watch the changing marketplace this refresh season.
The Pursuit of gappyness
Hey there blog readers! My name’s Matt and I’m one of the new(er) gappers here at gap intelligence, although I’ve been working in Data Operations for almost 9 months now. That being said, I’m not going to give you the standard biographical introduction you may have come to expect from newbies, I’ll just keep that part brief… I am a native Southern Californian who was born and raised in Pasadena, attended college at UC Santa Barbara (olé, Gauchos!), and stayed in SB after I graduated until a little over 8 years ago when I relocated to San Diego.
But given the fact that I’ve been with gap for nearly a year already and a rundown of my personal background doesn’t seem quite fitting anymore, I’m going to take the opportunity to reflect upon this past year for my very first blog post instead. I’m sure you’ve all heard the old expression, “what a difference a (insert unit of time here) makes.” And although it’s an overused cliché, I can honestly say that I’ve never experienced as much positive change in a given unit of time as I have over the last year.
Flash back to March 2013, and you’ll find me going through a bit of a rough patch. At the time, I was working at a job I had been becoming increasingly dissatisfied with. My morale was at an all-time low, I found myself experiencing feelings of dread just commuting to work each day and, to make matters worse, there didn’t seem to be any real end in sight. That is until one day, almost exactly a year ago, I realized that I just couldn’t take it anymore and decided that resignation and subsequent unemployment were more appealing options than staying there. And since I wound up leaving my job with no contingency plan whatsoever, the months that followed were, needless to say, pretty stressful. I became frustrated with the lack of job prospects, and anxious about what would happen if my reserves ran dry. Long story short, I always understood that my decision would put me into a challenging situation, but things were not going as ideally as I had hoped. And that was just my professional life…
In terms of my personal life, things were thankfully going a little bit better. I had recently started dating an amazing girl and everything seemed to be just perfect. We had already felt that instant connection old couples talk about when they say “don’t go looking for it, it’ll just happen” or “when you know, you know” and never looked back. I was, however, somewhat concerned about how the decision to leave my job might affect our still-budding relationship. My girlfriend was admittedly opposed to my decision, but agreed to stand behind it to give me a sense of support. Still, I feared that she may learn to resent me or think of me as an underachiever who’s work ethic didn’t meet her standards. After all, I had just quit a steady job with no backup plan in mind, so who was I to know if she’d accuse me of being lazy or opportunistic now that I had a significant other to mooch off of?
At any rate, I knew I needed to find a job. But I didn’t want my next job to be one that would eventually place me in the same predicament, meeting the end of my rope and quitting because I couldn’t see any other alternative. And despite the urgency to find employment quickly, I also didn’t want to simply focus on applying for positions I met the “minimum requirements” for. This time, I really needed to find a job and employer that were a perfect fit for me… Somewhere that would provide me with so much more than just a paycheck… A place with a company culture and value system that I could totally relate to… A job that would feel like more than just, well, a job.
So while I scoured the job listings for opportunities I was not only qualified for, but that also met the personal criteria I had set for myself, I decided to adopt a new strategy for my search this time around as well. I thought about the friends of mine who seemed to love their jobs the most, and reached out to them directly. That’s when I contacted Erin, a resident gapper and the company’s unofficial social media guru, who was a friend of mine from the college days. I had already been noticing it for quite some time, but Erin always seemed to be posting something on Facebook that made gap intelligence seem like an awesome place to work, whether it was information about an upcoming charity event, photos from a fun company outing, or just tons of smiling faces. It was obvious to me that Erin loved where she worked, and it seemed like the “fit” I was looking for as well. Unfortunately, gap didn’t have any positions available at the time, but I asked Erin to think about me if anything ever opened up.
About a month later, Erin texted me to let me know a position had become available. She asked me to send her a copy of my resume and I immediately did. Shortly thereafter I was contacted to schedule an interview, so again I referred to Erin for any input or information she could provide as I prepared. I remember her telling me at the time that gap is really big on people with genuine passion for something, and that they hire based on if they feel like you’d fit within their unique work culture because, as she put it, “the job itself can be learned over time.” Hold the phone, here was an employer that emphasized passion and compatibility above the actual day-to-day functions of the job?! It dawned on me that this was a company looking for the same qualities in new hires that I was looking for in an employer.
Well as luck would have it, gap and I turned out to be a match for one another and I was hired on after two interviews. Upon hire, the first actual exposure I had to the company was at their annual gapCon event, where I was fortunate enough to hear the history of gap and how it was originally established. It turned out that, Gary, our founder and fearless leader, similarly left a certain “situation” in order to pursue something that was a better fit for him. When he founded gap intelligence, he had a vision of creating a company that was unique, values-led, and passionate. This immediately and obviously resonated with me, and I knew right then that I had found the exact type of place I had been looking for all along. And although I’ve only been here for about 9 months of it myself, in the 11 years since gap was born, I think it’s pretty safe to say that Gary has accomplished his vision.
I won’t go into detail about what life at gap has been like for me since then, but I will say that I’ve felt more challenged, encouraged, appreciated, and embraced in less than a year here than I ever did at any previous employer. This company has already taught me that a job can be so much more than just “work,” and that a working environment that runs more like a community can be the difference between “how will I ever get through this week?” and “what can I do to impact our next 5 years?”
Similarly, I’ve noticed a shift in my thinking as far as relationships go over the last year as well. My girlfriend and I are still going strong, and I’m happy to report that the woman I was worried might think of me as a slacker 12 months ago and I are now talking about moving in together instead. I guess you could say that my life has gotten much more serious both personally and professionally over the last year, but it’s for all the best reasons. While I used to pretty much live one day at a time and not think too much about the future, now I find myself not only thinking about it, but being genuinely excited for it as well. I now have a companion and a job that I care for both very much, and I’ve come to realize that it’s not just me I have to think about anymore. Now I’m seeing the bigger picture and understanding that the actions and choices I make today can and will impact the future at both my job and in my relationship, and it’s absolutely awesome. The events of the last year have given me a renewed sense of perspective, purpose, and true happiness. So thank you, 20-lucky-number-13 (with honorable mention going to Q1 2014), for shaping up to be an amazing 12 months!
Now, for the next 12… What’ve you got for me?
HP Takes Lead in Touchscreen Laptop Market
Since the arrival of Windows 8 in October 2012, the notebook industry has been adopting touchscreens at an alarming rate. In fact, touch-enabled notebooks now account for 56% of total notebook placements in the US retail channel. What a difference a year-and-a-half makes!
Acer and Asus embraced touch functionality faster than any other manufacturers and claimed first-mover advantage. However, since touchscreen panel production capacities were low, the costs made the first wave of touchscreen laptops very expensive. The prohibitive prices, in addition to negative reaction to Windows 8′s new interface, made for weak sales, which negatively impacted the early adopters. In an earnings call, CEO Jason Chen attributed the company’s recent losses to investing too early in touchscreens and Ultrabooks, admitting that Acer “took the initiative more aggressively than anybody else, to the point where we got hurt.”
Over the last year, panel costs have come down dramatically and more manufacturers have devoted significant portions of their retail assortments to touch-enabled models. In September, in particular, HP took advantage of lower panel costs and released a wave of low-cost Pavilion TouchSmart configurations throughout the retail channel, which caught Acer and others flat-footed. Using our handy new PowerPivot tool, we can see how dramatic that shift was.
HP now has 35% shelf share in the touchscreen notebook market, up from 8% just a year ago. Consumers are beginning to view touchscreens as a standard feature, rather than a luxury, and pricing has followed suit. For some configurations, the cost of upgrading to a touchscreen has declined from over $100 to less than $50. Over the last several months, HP has brought touchscreens to even its entry-level offerings including its new 15 TouchSmart series, which has been advertised for prices as low as $369 (Staples) and $379 (Best Buy).
While the weak economy makes it hard to justify buying a high-priced Ultrabook, more affordable touchscreen laptops are now the norm and will be especially visible during the upcoming back-to-school selling season. Even long-time holdouts like Chromebooks and large 17-inch laptops are beginning to adopt touch functionality, making the non-touch models look like outliers. As tablets grow in popularity, prices come down, and new touch technologies emerge, manufacturers may find it hard to justify not including a touchscreen in their future notebooks.