Kodak Company

1.1. a)Competitors provide lover-priced products, b) Restrictions on private labeling, c) Market development strategies of foreign competitors, like Fuji and Agfa.

1.2. If we look at the Product Life Cycle, we realize that it is in the maturity phase. As a result, there is a fierce competition, price war and battle for market share. If Kodak maintains its status quo, it will continue to lose its market share, since the others’ market share is growing due to the private labeled and/or lower-priced products. Customers become more price-sensitive. In addition, since buyers are indifferent among products, they can easily shift from one brand to another.

2. Kodak’s objective should be to regain the market share of 76% and aim to maintain it for future. Kodak should penetrate into the market more, increase its product variance. (Brand-based differentiation) It should target professionals and serious amateurs. While lowering the gross profit margin Kodak should increase the dealers’ margin, give incentives to dealers. Main portion of films are distributes through dept. stores, drug stores, etc. As shown in Exhibit-1, if Kodak increases the dealer’s margin from 20% to 29%, the dealers will get the max profit among these brands. In order to attract the price sensitive customers. (demand is elastic) It should also provide