Imaging Company
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As of December 1, 2011
Overview
Main Products
Digital cameras, film cameras, interchangeable lenses, speedlights, film scanners, accessories, software, sport optics
Consolidated Financial Results
Market Environment and Business Trends
Although we anticipate strong demand for digital cameras with interchangeable lens, the impact of damages due to the recent floods in Thailand has resulted in supply restrictions and it is predicted that the market will only show marginal growth.
Despite expectations for further growth in emerging markets for compact digital cameras, particularly in Asia, we anticipate that overall, markets will be almost on a par.
Shipments of Digital Cameras
- Source: Camera & Imaging Products Association
- *Shipment units=domestic shipment units+export units (member manufacturers only)
Shipment amounts=domestic shipment amounts+export amounts (member manufacturers only) - *Nikon's share is not calculated from 2008 since officially announced figures by the Company are consolidated sales units.
Shipments of Digital Camera with Interchangeable Lens
- Source: Camera & Imaging Products Association
- *Shipment units=domestic shipment units+export units (member manufacturers only)
Shipment amounts=domestic shipment amounts+export amounts (member manufacturers only) - *Nikon's share is not calculated from 2008 since officially announced figures by the Company are consolidated sales units.
See Financial and Business Data for the Second Quarter of Year ending March 31, 2012 (November 4, 2011)
Sales volume of Nikon Digital imaging products (Sales & Forecast)
- Digital Camera with Interchangeable Lens
- Interchangeable lenses
- Compact DSC
PDF File (PDF:96KB)
An Interview with the Company President
Yasuyuki Okamoto
Director, Member of the Board & Executive Officer, President of Imaging Company
- Q1:What were the business results and principal activities in the Imaging Company over the first half of the year ending March 2012?
Although the domestic digital SLR camera market shrunk over the first half of the fiscal year due to the impact of the earthquake, markets in the US, Europe and Asia showed positive growth. On the other hand, the market for compact digital cameras showed negative growth in all regions.
Amidst this environment, in regards to digital SLR cameras, the D5100 released in April 2011 showed robust growth and we channeled our energies into increasing sales of existing products, such as our mid-range D7000 and D90 models and entry level models such as the D3100 and succeeded in achieving an increase in unit sales which exceeded market growth. In the compact digital camera category, in addition to a substantial increase in sales in our high-end P Series products, including the COOLPIX P500 and COOLPIX P300 models, our S Series continued to perform strongly and despite a contraction in the market, we achieved an increase in unit sales and steadily increased our market share, particularly in Europe. We also achieved a steady increase in sales of our interchangeable lenses, particularly for lenses packaged with digital SLR cameras.
Further, in addition to the global launch of our new Advanced Camera with Interchangeable Lens, the Nikon 1 series, which promises to offer customers a new way to enjoy image expression, we also implemented measures to expand our sales bases in emerging markets. As a result, we posted record-high sales for the first half in our digital SLR camera, compact digital camera and interchangeable lens product categories, recording net sales of ¥324,546 million, an increase of 15.1% on figures from the same period the previous year, and operating income of ¥47, 417 million, up 105.7% year on year.
- Q2:What is the outlook for the digital camera market and Nikon’s sales strategies?
-
A2:
Despite expectations for further growth in emerging markets for compact digital cameras, particularly in Asia, we anticipate that overall, markets will be almost on a par. Although we anticipate strong demand for digital cameras with interchangeable lens, the impact of damages due to the recent floods in Thailand has resulted in supply restrictions and it is predicted that the market will only show marginal growth.
The Nikon Group has also been affected by the recent floods in Thailand with our production base for digital SLR cameras and interchangeable lenses suffering inundation damage and although operations had been suspended since early October the drainage of water from around the area of the facilities was completed on November 26. We are putting all our energy into restoring infrastructure and production equipment of the factory aiming for some part of factory operation to resume from January 2012. Further, alternative and limited production at our partner factories in Thailand has started earlier than expected, and we have started shipment of certain digital SLR cameras and interchangeable lenses since November 30. We will continue to work towards recovery of full production with the aim of returning the production of digital SLR and interchangeable lenses to normal by the end of March 2012.
On the other hand, Nikon launched the Nikon 1 series, the Advanced Camera with Interchangeable Lens that proposes new forms of imaging expression and enjoyment, in October this year and creates new value for imaging expression.Based on efforts to bolster marketing capabilities and brand strength, Nikon will continue to focus on market development, particularly in emerging countries and regions in which Nikon has a low market share. As part of this strategy, in April 2011 we established sales subsidiaries in Thailand and Brazil and commenced business operations. We firmly believe that it will be possible to achieve rapid sales growth in these markets.
To increase market share in emerging countries, brand building is crucial. Fortunately, a superior Nikon brand image has already taken root in emerging countries. We are striving to further develop that image into "Nikon is a sophisticated, fashionable brand that provides extremely high-quality products covering the full spectrum of needs, from the novice user to the professional."
These brand-building efforts are steadily beginning to blossom. We have already built a leading market share for digital cameras with interchangeable lens—one of our established areas of strength—in many countries, and in the compact digital camera market, we are increasing market share in such countries as India, China and Russia.
- Q3:What specific strategies are you pursuing to expand market share in overseas markets other than emerging markets?
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A3:
In the European market, where Nikon has been slow to expand its sales, in the fiscal year ending March 2012—continuing on from the previous fiscal year—we are undertaking a concerted push to improve our position. To reinforce our compact digital camera marketing capabilities in Europe, I want to fully utilize my own experience in successfully achieving a large increase in market share when I served as president of Nikon Inc., the Imaging Company's U.S. sales subsidiary.
Although the United States is the world's largest compact digital camera market, it is spread over a very wide geographic territory. Consequently, half-hearted measures will not lead to a successful increase in market share. With this in mind, we focused on three key market expansion policies: (1) the development and launch of products suited to the U.S. market; (2) the rollout of aggressive television advertising campaigns to raise brand awareness; and (3) the rebuilding of a seamless array of sales channels covering the entire U.S. market, from specialty stores to mass-merchandise chains. Through this successful approach, Nikon gained the top market share in the United States for compact digital cameras. By leveraging this kind of experience, I intend to provide comprehensive leadership as we strive to make Nikon the No. 1 compact digital camera brand in Europe. Already in Europe our campaigns are proving very popular and Nikon's position is gradually improving.
- Q4:What are the priority issues for the Imaging Company in areas other than products and sales?
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A4:
At the Imaging Company, the issue we are addressing with the highest priority is the strengthening of procurement capabilities. Our objective is to pursue the greatest possible production-cost reductions. To realize this goal, we have newly established a specialist organizational unit. The new unit will increase the efficiency of intense procurement negotiations and the management of procurement processes with the aim of reducing costs.
Another issue we are addressing is the shortening of product development lead times. To successfully compete against our peers, the realization of shorter lead times is absolutely imperative. To this end, it is essential to thoroughly clarify all processes related to product development, and review and reform these processes.
All of Nikon's principle competitors are very large and powerful companies. To prevail in such a fiercely competitive environment, we want to address a wide range of issues and constantly take on difficult challenges with even greater determination, without compromising lightly on anything we do.
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