Industry Stories: Why Kodak Failed

Kodak was once a household name, synonymous with photography and film for almost the entire 20th century. But in recent years, the company has been struggling to stay afloat. So, what went wrong?

Kodak once possessed 80% of global market share in the photography industry. Their business plan consisted in selling cameras at an affordable rate generating low profit margins while making films, printing, and other accessories more expensive, which was their main source of income. This technique is called "razor and blades." Razors are sold at an affordable price point and blades are where companies make a profit, as they are more frequently sold and more expensive. Although the model helped Kodak achieve high profit margins in the beginning, the invention of digital cameras made consumables slowly become obsolete.

The main reason for Kodak’s failure is its failure to adapt to the digital age. While Kodak was a leader in the film and photography industry, it failed to recognize the potential of digital photography and the internet. As digital cameras and smartphones became more popular, Kodak was slow to respond and failed to capitalize on the new technology.

The company also didn't recognize the importance of marketing and branding. While Kodak had a strong brand presence in the past, it failed to keep up with the changing times. As other companies began to invest in marketing and branding, Kodak was left behind.

Kodak also failed to invest in research and development. While other companies were investing in new technologies, Kodak was slow to respond. Their marketing team attempted to warn the company about the dangers of not updating their core principles to achieve success, but management ignored their advice (so when your marketer says something to you please listen, we kinda know what we're talking about ;)). Instead, funds were allocated towards the purchase of several smaller companies. This lack of investment meant that Kodak was unable to keep up with the competition and failed to develop new products and services.

Finally, Kodak failed to recognize the importance of customer service. As other companies began to focus on customer service, Kodak was slow to respond. This lack of focus on customer service meant that customers were not satisfied with Kodak’s products and services.

Kodak’s failure to adapt to the digital age, invest in marketing and branding, invest in research and development, and focus on customer service all contributed to its downfall. While Kodak was once a leader in the photography and film industry, its failure to keep up with the changing times has led to its downfall.