Jump to content

Sales results so far


Liz
 Share

Recommended Posts

Have read with great interest over the last 18 months and longer about the future of our industry with surviving big moguls offering ridiculous prices for digital prints.  We thought most customers are so media educated now into "self-shopping" and "DIY" everything that the concept of customer loyalty was pretty well out the door.  We also decided we had to match the big guys from time to time just to bring people into our store then upsell.  So cut our advertising budget to zilch and relied on spot advertising special print prices.  Results to date are - Film Sales -21% (jeez, who would have predicted that!!) Digital Sales +2% (with nearly 6 months of selling ridiculous cost price prints) and other items, eg cameras, frames albums +32%.  Total increase in GP 12% over 2005 same period.  Have now this week done a review and focused on the specialised print items people don't seem so price sensitive to, like passports, print from prints, scanning and resizing prints, and really upped our prices in these areas.  Just a thought  ;)  

Link to comment
Share on other sites

Hi Liz,

Great post and an excellent strategy. We've been focusing on these high margin items too and seen similar results. The only thing I was surprised to see were the digital sales which really always will be our core product. I wonder whether we really do need to be trying to match the Big Guys - after all with D&P we were always priced very differently. The 4x6 price thing is a trap too many in our industry are falling into and we'll never succeed.

As an aside we've organised a 'summit' of successful Minilab owners in our country today and tomorrow where we're all going to share some ideas and learn about each others formulas. It will be an interesting few days. Will post up the results later in the week.

Chris

Link to comment
Share on other sites

We have 3 kiosks, one print now (thermal) two print later (lab) all of which are immediate printing of course.  We have upped heavily the price on thermal which also has a scanner and put the price cut only (one month out of 3) on the lab kiosks.  People love it.  They get silver halide prints after all, which I've found out, means absolutely nothing to them.  Thermal, silver halide  :-/ But at least they're cheaper for us to produce.  We went the route of explaining the benefits of lab printing for a higher price but we found fewer and fewer people coming through the door to explain to!  So bit the bullet and notice that people are comparing the better quality for the same price.  Our opposition is 15c AUD, we're 18c.  It's a bit of a roller coaster but we tried the "specialist" route and that failed, now we're "specialists" and "sometimes bargainists". After all, we have sales on other items every 3 or so months.  What's the diff?    

Link to comment
Share on other sites

Yes it's interesting that people haggle over the price of 4x6 digital prints, but no one has ever questioned $10.00 for a passport photo, or the price of print to print, and I find fewer people now question the price of film processing, and people always choose the Kodak film off my shelf which is the most expensive.

We've now got QFL doing digital prints for 13c each and every pharmacy I go past has a poster in the window advertising this fact. I have also seen instant kiosks in pharmacies doing instant prints for 19c (plus a $2.99 usage fee??), and 39c for 6x8's.

40c a print is now considered a premium price for digital prints, and stangely silver halide prints, which are the highest quality, and require expensive specialist equipment to produce don't command a premium price, in fact they are sold at the cheapest rate!

Link to comment
Share on other sites

So true Colpot.  Chemists in Oz have traditionally been the "photo people" and we independents are interlopers to that territory.  They've only just started fighting back if you read the website dedictated to chemists.  Their kiosk supplier is from NZ with Mitsubishi paper, (that you could spit through!).  We worked out to get a print at 19C given their useage fees you had to do something like 700 prints.  How do you get that message through?  But, slick marketing....... :)  The big guys have a model of cop the loss here (prints at 15C for 15 days) to make money "there" on TV's furniture, etc.  We thought, OK, let's try it.  We think its working for us.  Mind you, I'm not retiring on my cataramaran yet, and unlikely to when I focus on being solely a digital print lab.  Would have thought canvas prints and large prints would be a pull.  Nup, Harvey Norman, our biggest advertiser and pain in the butt here, is now doing canvas prints, large prints, etc.... I'd love to have a chat with him and ask why did you think the digital print market was a good business strategy.  I'd love to know.  Finding your niche and competing at the same time is a pain in the ......  Well, we were told by Kodak at the 1995 Conference that fundamentally we'd be Kodak product retail outlets which truly offended me at the time, but it's turned out to be that way.  What a fascinating industry!!! ;D  

Link to comment
Share on other sites

I actually worked for some time in a chemist, but what suprises me is that they will give their window space to advertise 13c prints. I mean what are they going to get out of it? Someone gets 100 prints done and pays $13, how much of that will the chemist get? A couple of dollars? It can't be worth their time. Surely they would be better off promoting hair products or something else they will at least make some money on?

As for Harvey Norman doing canvas prints, at least they haven't cut the price of those to below cost....yet! (20"x30" canvas prints for $9.95 might be their next business strategy!  ;D)

Link to comment
Share on other sites

The reason Harvey Normans are so keen to push the photo market is because it drives customers into their stores who then are supposed to buy Plasma TV's. It's their theory, but who knows how successful it's been. For the photo market they have just been trouble. Watch out Europe - they have already begun operations in Ireland!

I've just returned from a few days with minilab retailers from around Australasia at a meeting in Auckland. We visited a number of stores, looked at trends and discussed each others successes. Here's the findings;

Get a good online strategy. Some retailers are doing very well with this and are enjoying ongoing business with repeat orders years after the customers first signed on.

Definitely have a staged pricing system to drive volume in enlargement sales. If they can see really good value people will order up large. Make sure the graphics and size charts are easy to understand - and look professional.

Prints on canvas and photo prints block mounted are generating big revenue - some are making up for the loss of rollage with the growth in these markets. On a consumer basis large format is not proving successful but it is driving business customers back into photo stores for displays, POS, etc.

Consider stocking the cheaper, well-branded digital cameras. There is some OK margin in these and even more in the bags and accessories. Keep the range limited though.

Get as many kiosks as you can and make them a pleasant place to be. Lots of stores forget about comfort. Get the staff out from behind the counter and alongside the kiosk users. Most people won't ask for help and there is lots of opportunity for add-on sales if you get them started correctly.

Look outside of the tradiotional suppliers for paper and chemistry. When every cent counts you can save a considerable amount by shopping 'round.

Link to comment
Share on other sites

I went past a chemist the other day with a big sign "19c digital prints" out the front.

But if you read the fine print here http://www.photoexpress.com.au/ it's 19c per print plus "2.99 kiosk usage fee" max. 200 prints. So the actual cost ranges from a whopping $3.20 (for one print) to 20.5c for 200. Also I presume if you order 200 prints you have to stand around for half an hour while it prints them all. There is no way  to actually get your prints for the advertised 19c per print. I wonder how customers react to this sort of pricing?

Link to comment
Share on other sites

As I said, if you work it out, the 19c deal cuts in at about 700 prints when u factor in the machine useage cost.  Um, I think these machines also charge for every "extra" you do, eg crop or resize.  It's a good strategy to get people in your store and I'll play the moguls silly game from time to time.  We're piggy backing on their advertising.  We just do not think you can sit back and say smugly to yourself, we are specialists and people will seek that out.  Well, the majority won't and they don't.  Quite realise I'm breaking ranks here.  My only point of difference now with major stores (apart from TVs and DVDs!) is personalised service and quality compared to the big guys.  People no longer want to pay for that.  They expect it!  I think it's a romantic ideal to think that they'll pay more for it.  We've proved otherwise.  In the meantime, we've recovered our customer base.  We actually rang some and explained our point of differences (loved the guilty blustering over the 19c prints elsewhere) and they we're happy to return for the same price deal.  People want FAST, CHEAP, GOOD.  We can do that!  We just upsell elsewhere. :D.  

Link to comment
Share on other sites

People want FAST, CHEAP, GOOD
Still not to sure that everyone does want cheap??

Do you know how much a pint of milk cost?? or a loaf of bread?? The people selling it think they have to see such things cheap, but the punter, for the most parts does not know the prices, they shop where they like to shop... I pay around 30p more for a load of bread in my local shop, than a supermarket, cos I like my local shop

Link to comment
Share on other sites

The "shopper" is a pretty multi-faceted concept and the "convenience" factor works also, Neil.  I respect your previous posts in wanting to keep your prices up and at a respectful level but the reality is that we just cannot survive with that, the support is not there, and we have to have a fightback plan and create a alternative strategy to make profit.  Holding onto "specialist" prices, just won't do it.

We have also factored in that we are the "corner store".  When you want it, you want it, and don't care what you pay for that convenience.  It's still only bits and pieces.  Like passports, like batteries, like film, like large frames....and much more.  You can like the staff and the atmosphere of your local store but the issue is to make your shop the first point of call amidst a barrage of advertising aimed at luring that custom to them.  If you are not first in their mind, then you miss out.  The shopper is a creature of habit and I don't want my customers getting into the habit of going elsewhere through advertising indoctrination.

All I'm saying, is that we have matched the specials of our competitors, ridden piggy back advertising to keep custom and hiked a lot of other prices.  We believe it has worked.  We have Kodak above our door.  People see us as multi-national and present to us, expecting multi-national prices.  This gives us not a lot of choice.  We think we've made that work for us, not against us.

I don't know what it's like in Gr Britain but in Oz? we have acres of land allocated to shopping meccas scattered throughout cities and suburbs.  They are like clones of each other but that's where people flock to shop.  The next step down is the suburban shopping centre where you can make it if you are an independent and the population is there to support it.  But if you are a photographic shop, on your own, with no supporting shopping choice, forget it!

    

Link to comment
Share on other sites

The Kiosk providor Liz mentioned has exited the NZ market because it hasn't worked for them or the retailer. My guess is that they'll be under big pressure in Aus. too because when you're talking big numbers of prints dye-sub just isn't cost effective. That, plus with the retailer and kiosk franchisor wanting a cut what's in it? Oh, and I forgot to mention the expensive Sony media their machines use!

There has always been competition in our markets right back to the early days of minilabs. It's nothing new - just different.

Link to comment
Share on other sites

Join the conversation

You can post now and register later. If you have an account, sign in now to post with your account.

Guest
Reply to this topic...

×   Pasted as rich text.   Paste as plain text instead

  Only 75 emoji are allowed.

×   Your link has been automatically embedded.   Display as a link instead

×   Your previous content has been restored.   Clear editor

×   You cannot paste images directly. Upload or insert images from URL.

Loading...
 Share

×
×
  • Create New...