Canon shifts focus to keep up with trends

Two years ago, 60% of the total camera sale of Canon came from compact cameras, while the rest came from the DSLRs

 

Faced with a shrinking demand for compact cameras and retail printing equipment, Canon India is trying to reinvent itself. Apart from stepping up its DSLR (Digital Single Lens Reflex) camera marketing, it is also adding various services to its portfolio.

The Indian arm of the Japanese Canon Inc., a global pioneer in imaging solutions, clocked around Rs 1,851 crore of revenue last year. Half of it came from the sale of cameras. Alok Bharadwaj, the executive vice-president says that even though the company registered a 21 per cent growth in 2012, the overall sale is expected to remain flat this year because of the poor economic environment and decreasing demand for compact cameras.

Two years ago, 60 per cent of the total camera sale of Canon came from compact cameras, while the rest came from the DSLRs, that were more expensive and deemed as cameras for pros. Last year, the erstwhile bestselling segment contributed only 50 per cent and is further expected to shrink to 40 per cent, with DSLR sale gaining pace.

The company will invest more in DSLRs as they become popular. On the cards, Bharadwaj says is "re-configuring its 108 exclusive showrooms to focus more on the DSLR experience, in line with the current trends." The option of celebrity-based marketing is also being explored.

Canon will also shore up its services. Canon's office imaging segment, which contributed around Rs 400 crore last year is projected to grow by 15 per cent with the addition of a range of new services. The category caters to large enterprises with equipment such as multi-functional printers, scanners and copiers, and their attendant servicing.

Besides hardware sale, Canon had document management services, that brought in Rs 100 crore in 2012. It has since added digitisation services in order to take up digitising old records and using software for indexing and cataloguing. It is also planning to launch print- room management services where large enterprises could outsource management of their entire print rooms - along with cloud services for SMEs - that will include direct-sales team management, sales automation, warranty management and technical e-learning services on a pay-per-use model.

The sale of IT peripherals to retail customers such as SMEs (inkjet printers and faxes) is seeing depressed growth in a sharp contrast to the office segment. Technology research and consultancy firm Gartner says the overall multi-function printer market declined by 8.9 per cent in volume in January-March, 2013 over last year. Zalak Shah, research analyst with Gartner says companies are looking to optimise their current fleet with multi-function products.

Canon's focus on services for enterprises will work as Shah points out companies are focusing on cost optimisation and deploying technology in a better fashion, which is making them change from a "hardware-only mode to a more services-oriented outlook." She adds that clients are looking at product deals which have software management bundled in. Bharadwaj reminds that the proliferation of electronic transmission of data has reduced the printing needs of companies as well as individuals, making the company focus more on providing services around its products.