News

Price war develops in digital photos

March 22, 2005

Detroit News: A price war has broken out in digital photo printing. Wal-Mart, Costco and other retailers are sharply cutting prices on digital-photo prints in a furious effort to win consumers who are switching to digital cameras from traditional film. With the film business drying up, retailers can ill afford to lose printing revenues. After a slow start, retailers are beginning to gain traction with digital printing. Digital prints ordered at retailers more than tripled last year, says the trade group Photo Marketing Association International, while the number of prints made at home rose 37 percent. And the momentum is clearly with the retailers: Last year, while about 61 percent of all digital prints were made at home, that is down from 90 percent in 2000. One reason is the sharp increase in retail outlets offering digital printing. Most drug and discount stores can now handle digital prints in their one-hour photo-processing minilabs. Labs can produce prints at a cost to operators of less than 5 cents apiece, says Greg Joe, marketing manager for Japan's Noritsu Ltd., a big minilab maker. Retailers with less business can install cheaper, but also slower, digital kiosks. The number of photo kiosks in the United States is expected to grow to 121,000 by 2008, up from 75,000 today, says Kerry Flatley, a consultant with market researcher Infotrends. Last year, 17 percent of digital-camera owners used a kiosk versus just 6 percent the year before, she says. Click here to read the full story.