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THE EVOLVING LANDSCAPE OF PHOTOGRAPHY

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THE EVOLVING LANDSCAPE OF PHOTOGRAPHY

Photography is bigger than ever, driven partly by the proliferation of smartphones and our ability to edit, store and share images. The sociable element of the smartphone experience has also allowed us to cultivate a new form of casual communicative picture taking, far removed from the experience of traditional photography. As consumer behaviour continues to evolve, what does the picture look like for the future of this category?

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SMARTPHONES ARE FOR CAPTURING ‘MOMENTS’Smartphones have changed the nature of photography, not just in expanding camera ownership, but in ensuring that our cameras are with us throughout the day. Today, the image quality seen on smartphones has become ‘good enough’ for many consumers, negatively impacting sales of low-end camera models. This is particularly apparent amongst younger consumers (18-34 year olds) who are now the only age group in the UK that are more likely to own a smartphone than a digital camera1. This disruption follows a pattern evident in the portable gaming market, and the portable music player market before it. When the equivalent experience on a smartphone improves at a faster rate than the standalone device, we’re less inclined to carry the latter. But where is the opportunity to drive growth in the camera industry and overcome the smartphone threat?

This tells us that although consumers find smartphones most convenient for casual picture taking, they are more likely to turn to their digital camera when practicing more traditional photography and for taking photos they really want to keep. These kinds of photos are also more likely to be printed or made into personalised photo books, which are becoming increasingly popular.

100%

80%

60%

40%

20%

0%

10%

30%

50%

70%

90% 88%

11%

82%

15%

70%

28%

66%

33%

71%

91%

20%

7%

Travelling / Holiday

Digital Camera Smartphone

Events (Concerts, Sporting)

Friends / Family Photos

Days Out Nights Out Spontaneous Photos

GfK Consumer Experience Data (UK) Base: Smartphone and Digital Camera owners n=766 (very similar picture in Germany)

Research conducted by GfK shows how smartphones are being used much more frequently than digital cameras, with 34% of UK consumers using their smartphone camera daily compared to just 6% using their digital camera2. This is partly because smartphones are always with us but also because they are particularly effective at capturing and sharing spontaneous moments instantly (91% use their smartphone for this purpose). However, looking at other scenarios where we would typically take photos, it is clear that there is still a time and place for the standalone digital camera; it is seen as the preferred option for holidays, events and other special occasions in both the UK and Germany. This represents a good argument for

the standalone digital camera, one which consumers are responding to at the high-end of the digital camera category. Interchangeable lens cameras have enjoyed considerable growth in recent years (up 23% since 20103), particularly with Compact System Cameras (CSCs) which are estimated to grow a further 11% year-on-year in 20144.

Which camera would you typically use in each of the following scenarios?

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OPPORTUNITY AT THE HIGH-END LOOKING TO THE FUTUREThis also signifies a potential opportunity for targeting the younger age groups. In the UK and Germany half of 18-24 year olds are editing and applying filters to their smartphone images (48%), indicating a higher engagement with the artistic aspect of photography. Those consumers that own both a smartphone and a CSC are twice as likely to share photos on specialist platforms like Flickr, reinforcing the importance of sociability even at the high end of the category. Educating consumers on high end camera propositions and their benefits will be increasingly important; particularly for younger consumers who have the lowest awareness of CSCs compared to other age groups (in Germany 37% do not know much about CSCs and this rises to 54% in the UK).

camera products, and in order to succeed in this segment, manufacturers will need to educate and inform consumers about the high-end camera products available and the benefits that clearly differentiate them from the smartphone camera experience. In a highly dynamic market, manufacturers and retailers need to adapt their sales and marketing approach to make the most of market opportunities. Photographer Ansel Adams once said, “photography…offers an infinite variety of perception, interpretation and execution” and thus if a camera can offer a clearly differentiated experience, it can find a place amongst the plethora of photography devices in the modern world.

For a long time, success in the category was defined by the ratio between picture quality and price. Smartphones have competed with this by driving accessibility, sociability, and most of all engagement with photography across a broader audience. This wider engagement has created a significant opportunity for growth at the high end of the camera category, where smartphones are currently unable to compete. Over half of consumers who considered purchasing a high-end camera in the UK were doing so for the best quality photos (57%), but 28% also wanted more manual controls and the ability to produce specific effects beyond what is possible on a smartphone or lower-end camera.

Photography is a form of expression and as such will inevitably adapt, react and evolve over time. In the last few years smartphones have had a profound impact on the way consumers take, share and interact with their photos with a shift towards more casual and spontaneous picture taking. This trend could follow a natural progression towards wearables, which promote even greater spontaneity by automatically capturing photos at regular intervals throughout the day. GfK Consumer Trends and Forecasting predicts a strong growth in the Western Europe region for the action camera category in 2014 (35% year-on-year in volume), and products such as the GoPro which are designed to operate independently. There is also strong potential for high-end Adelynne Chao | Benedict Kenney

GfK Consumer Experiences

1 GfK Consumer Panels2 GfK Consumer Experience Data November 20133 GfK Retail Sales & Tracking Data4 GfK Consumer Trends & Forecasting

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KEY INSIGHTS

A quarter of all smartphone owners intend to buy a camera in the next 12 months

Price is a key barrier for young consumers with half not intending to purchase due to cost in the UK & Germany

Mainly to take better quality photos…

…but also because they feel that smartphone image quality is not good enough…

…and only 16% actively prefer a smartphone for taking photos…

21%

44%

19%

16%

54%

21%

16%

30%

22% 51%

But

DAILY USAGE

EDITING PHOTOS

SMARTPHONE CAMERA SATISFACTION

FUTURE PURCHASE INTENT

% of consumers satisfied with the following activities/attributes on their smartphone cameras:

Transferring photos to another device, e.g. computer 66% 60% 70%

Find it intuitive / easy-to-use for taking photos 65% 57% 67%

Happy with overall image quality 60% 54% 64%

Share photos on social networks like Twitter or Facebook etc. 55% 57% 54%

Share photos using SMS/MMS, email or instant messaging 55% 51% 59%

Back-up photos to online cloud storage 47% 48% 47%

Adjust camera settings before taking photo 46% 42% 50%

Upload photos to online photo sites such as Flickr or Picasa etc. 44% 44% 44%

Edit photos / apply filters to photos 42% 39% 45%

Although smartphone owners are generally satisfied with their smartphone camera’s ease of use and image quality…

…there are clear areas where smartphones are not meeting users’ needs. This is particularly evident around editing and applying filters to photos

TOTAL

TOTAL AGE 18-24

of consumers use their smartphone to take photos daily

of consumers use their cameras to take photos daily

41%34%

5%

47%

8%6%

Almost

amongst

13

of consumers edit their smartphone photos

and this rises to 46%

18-24year olds

in

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ABOUT GFK CONTACT

Our business is divided into two sectors: Consumer Choices and Consumer Experiences. These sectors work closely together across the globe as “One GfK”.

■ Consumer Choices investigates what’s selling, when and where. We continuously track online and offline media as well as major sales and information channels.

■ Consumer Experiences concentrates on consumers’ attitudes, perceptions and behaviour. Using creative and robust methodologies, we answer “who”, “what”, “why” and “how” of consumer buying.

GfK is one of the world’s largest research companies, with around 13,000 experts working to discover new insights into the way people live, think and shop, in over 100 markets, every day. GfK is constantly innovating and using the latest technologies and the smartest methodologies to give its clients the clearest understanding of the most important people in the world: their customers.

We have a wide portfolio of products and solutions that track everything you need to understand how your products are really performing, what is driving customer behaviour and how you can innovate for success. Our strength lies in our ability to provide both the full picture and context for your market and consumers, as well as the fine detail you need to make key decisions. We can do this because our industry-specific experts work hand-in-hand with our cross-industry specialists.

For more information please visit www.gfk.com/solutions or contact our Consumer Experiences team to discuss your requirements.

GfK’s custom research team have extensive experience developing tailored solutions for clients. We offer a fully integrated service covering a range of fields from brand & customer experience tracking to mystery shopping and market opportunity & innovation solutions. In addition, we have photo specific continuous tracking panels across a number of markets covering:

■ Shopper/Brand Profile

■ Path to purchase

■ Brand loyalty

■ Migration

■ Hardware purchase and accessories

UKRanjiv Dale+44 207 890 9133ranjiv.dale@gfk.com

GermanyDr. Wolfgang Neubarth+49 911 395 4849wolfgang.neubarth@gfk.com