Abstract:

A French leader in the retail distribution of upscale photographic equipment retained the MAC Group to help his organization in identifying and implementing a marketing strategy in photo-finishing. Although our client had a strong market share and image in photographic equipment, its position in the photo-finishing activity was not significant. The French market (4 billion Francs in sales and an annual growth rate of 6 to 7%) was dominated by high quality products and services. Average price today still exceeds 3 Francs per color picture while retail prices are below 1.5 Francs in Belgium, FRG and in the UK. Although the small independent photographers' market share was declining, they still represented 50% of the retail market with more than 3 outlets. Mini-lab boutiques with 1 hour service were developing rapidly due to the high price level. In 1989 mini-lab's market share exceeds 25%. There was no clear leader on the French market : Fnac, Carrefour, France Lolsir, Phox {a group of independent photographers) have market shares which do not exceed 4 to 5% while Boots, Dixon and other UK retailers have shares over 12 to 15%. The French market for photo-finishing presented opportunities but also threats for our client. Due to its important growth and high margin structure (40-45%), France was identified as the most attractive market by most international competitors. It was then important for our client to rapidly identify and implement a strategy which would position the company as a leader.