Film

Drug Store News, May 20, 1996

Like an anxious parent-in-waiting -- in this case, for the 1996 launch of the Advanced Photo System (APS) -- the photo industry seemed stuck in 1995 with sales just under flat in film and processing.

For the drug channel, however, a number of major drug chains reported gains in 1995 in photoprocessing, especially in the one-hour lab segment. All chains responding to Drug Store News, survey reported continuing bullish sales of single-use cameras. In film sales, all in the spot survey reported that at worst film was flat, and most reported film sales up slightly.

For the entire drug store industry (including independents), on the other hand, Information Resources Inc. showed film sales (it tracks "film and flash") down slightly. (The Photo Marketing Association does not have 1995 figures available for film roll sales by channel.)

Traditional cameras steady

Sales of traditional cameras was reported steady by most chains surveyed, with some chains doing well in higher-priced ($100 range) cameras, and many doing a brisk business in the $30-$40 area.

Ancillary photo sales, which includes both enlargements and reprints as well as photo products from mugs to posters to photos on PC disks, was reported either flat or slightly up by many drug chains. The emerging imaging segment, with its service products like Kodak's Copy Print Station and CreationStation and Fuji's Pictrostat and Picture Plus, continues to make inroads as chains add and promote services while educating consumers about the benefits of imaging for enhancing, copying, sharing and giving prints as gifts.

Single-use excels

The single-use camera segment continues to attract both new and heavier users as consumers discover this inexpensive ($10 to $17), hassle-free camera option for weddings and parties, sun and sand as well as unexpected business and other photo opportunities.

Single-use, also called one-time-use, was up 30.9 percent over the previous year in rolls processed for all channels. This added up to an estimated 7.4 percent of rolls processed in all channels.

Kodak's Pocket FunSaver line, rolled out in 1995, garnered praise from retailers for its sleek, camera-look packaging (less like film-in-a-box). This added visual value and an easier grasp of the "disposable" camera concept by consumers.

Most drug chains reported sales up in traditional cameras. There was some activity in higher-end cameras, but reportedly the bulk of drug chain camera sales in 1995 was in the affordable (mainly $30 to $40 ) area, including models from Vivitar and Konica as well as Fuji's Smart Shot and Kodak's Cameo lines.

With an approximate $20 difference between single-use and many of these lower-end cameras, some consumers are finally replacing old disk cameras (these fell 23.8 percent in rolls developed in 1995), while others apparently are trading up from a one-time-use to an inexpensive camera after discovering or rediscovering the fun of picture taking.

Film

New APS cameras and film made their debut in stores the third week of April, so the current year's outcome will show some share shift to the new film format.

But last year 35mm continued to increase in share. 35mm now commands an estimated 80.2 percent of rolls processed (according to PMA), not counting single-use cameras which also use 35mm film.

In 1995 Eastman Kodak rolled out its Royal Gold premium 35mm color print film. Several major chains said it showed satisfactory sales.

The higher-quality/higher-priced film clearly fits some markets better than others. Eckerd reported especially good Royal Gold film sales when it offered a free index print. Fuji also rolled out its premium Super HG Plus. Retailers who displayed it with the more extensively advertised Royal Gold reported that customers recognized premium film as a category when they saw both film products displayed together.

Fast gets better

In film processing share for drug stores (chains and independents) according to the PMA, the drug channel processed 24.3 percent of film rolls in 1995, compared with 25.6 percent for discount stores (PMA's designation for mass merchants) -- which has now edged out drug as the channel leader in photo processing.

The declining number of independents had an impact. Another factor was a big drop in processing in discount drug stores as a sector of the drug channel.

On the other hand, most large drug chains run aggressive promotions for overnight processing year round, and among the chains surveyed by DrSN, most reported overnight photo processing was up.

All chains said in-store processing rose for the year. This agrees with PMA's figures on fast vs. overnight processing: For all channels, fast processing rose 5.9 percent to reach 20.8 percent of rolls processed, while regular processing declined 2.4 percent overall in 1995.

In the drug channel, part of the gain was in the addition of labs. But drug retailers are quick to point out that same-lab sales were up too, as every year more consumers get used to fast processing.

For the retailer, in-store labs bring a higher margin than overnight, even though it takes more staff servicing. Increasingly drug chains are spreading labor costs by giving one-hour staffs more imaging and other products and services to sell, such as frames, print copying and other convenience desk services.