Retailers make adjustments, ride digital wave in photo

Chain Drug Review,  Nov 7, 2005  by John Schultz

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NEW YORK -- Chain drug stores, discounters and supermarkets are employing various strategies to extend their position in photo merchandising.

Earlier this fall Wal-Mart Stores Inc. signed a deal with Fuji Photo Film U.S.A. Inc. in which the supplier debuted a digital photo kiosk designed to dramatically reduce the price of digital photo prints at retail. The Digital Dropbox was introduced in all Wal-Mart stores and Sam's Club units.

Wal-Mart and Sam's Club are pricing Digital Dropbox prints at 15 cents and 13 cents, respectively. According to a Fujifilm spokeswoman, because the service omits the need for shipping charges the program represents the lowest price in the industry --including online services--and appeals particularly to those who lack broadband service.

"We are excited about the addition of a digital kiosk to our drop box, allowing our customers and members to get a great everyday-low price option on digital pictures, just like they have had--and still do have--from film," notes Sharon Wibben, vice president of photo and connections centers for Wal-Mart. "With the growth of the digital photo category becoming more mainstream, this only makes sense."

Consumers can drop off their film in an envelope or simply insett their digital media into the terminal, enter their name and phone number, select the print size and quantity, remove their media and obtain their receipt. The digital photos are uploaded to Fujicolor Processing Inc. for off-site printing and are prepared for pickup in stores two days later--the same as film orders.

"As the company that supported Wal-Mart's move to digital [in 2000], we are pleased to extend our relationship by providing the technology to offer customers more options than ever for lab-quality photos conveniently and affordably," asserts Hiro Saki, president and chief executive officer of Fujicolor Processing.

In the chain drug arena, a breakthrough in home video was made over the summer when CVS Corp. debuted what is said to be the world's first digital onetime-use video camcorder. In an alliance with Pure Digital Technologies Inc., the partners have made it easy for anyone to create and share DVD home movies.

"Making home videos easy and affordable for our customers is what the CVS onetime-use video camcorder is all about," explains Chris Bodine, executive vice president of merchandising. "Consumers can have a worry-free home moviemaking experience with an affordable single-use camcorder that fits into their pocket or purse.

"With the finished DVD they get back from the CVS photo lab, they have a convenient way to view and archive their precious memories that lets them share those memories just as easily as they share digital photos."

Pure Digital also has a partnership with Rite Aid Corp. The retailer has launched digital photo services featuring the Rite Aid digital onetime-use camera collection and one-hour digital print-to-store capability from www.riteaidcom.

Customers can order digital prints from their home or office computers through the chain's web site for one-hour pickup at their local Rite Aid store.

The camera line, developed by Pure Digital, consists of a model featuring a 1.4-inch color LCD screen (for instant image review and deleting capabilities) and a similar unit that excludes the LCD preview screen.

Both cameras, holding 25 pictures, are fully recycled after processing.

"Rite Aid is committed to being a leader in digital photo products and services," notes chief operating officer Jim Mastrian. "The new cameras truly make digital photography accessible to everyone."

Walgreen Co. entered into a contract in late August with Hewlett-Packard Co. (HP) under which customers of HP's Snapfish online service can order prints online and pick them up in one hour at a Walgreens store. Customers simply choose the "pick up" option, enter their zip code and then select a Walgreens store from the provided list of locations.

The retailer also selected Snapfish to provide the chain's own online photo service at www.walgreens.com/photo.

Walgreens, which uses the banner "Where America Takes Its Digital Pictures," extensively promotes the category in its Sunday circulars.

"Snapfish is leading the way in providing consumers with the ultimate choice of when, where and how they print their photos," maintains Ben Nelson, vice president and general manager of Snapfish.

"We're breaking down the silos of how consumers manage their photos--online, at home or at retail."

Moreover, last year Duane Reade Inc. signed a deal with Pixology PLC in which the latter is supplying the retailer with a digital photofinishing solution for customers--whether they are in-store, at home or traveling.

Kiosks have been installed in Duane Reade outlets in which customers can create print orders from digital media. Orders can be printed at the store or routed to another store to be sent back for pickup should there be no minilab.