Feeling the heat of the rising dollar, Canon India has decided to further hike prices of its products to maintain margins. The company had earlier increased its prices before the festive season. Kensaku Konishi, President & CEO, Canon India, said, “Due to rupee depreciation, we are facing severe problems. We will be increasing our prices across all product ranges after the festive season. The hike will be around 5–15 per cent. We have to give out the message to the market.”
Canon has hiked the prices of their printer products in the range of 8–10 per cent, whereas the price hike for its laser compatible products is around five per cent. The company has also put its expansion plans on hold due to uncertainty in the market.
To stimulate its product lineup in the downturn, the company announced the launch of 85 new state-of-the-art digital imaging products. These include digital cameras, digital video camcorders, printers, All-in-Ones, digital copiers, software applications, cable ID printers, card printers, etc.
The products launched are across its three divisions – 22 new products from Imaging Communication Products (ICP), 28 products from Consumer Systems Product (CSP), 30 products and 6 solutions from Business Imaging Solutions (BIS). These products are designed to add a whole new dimension to digital imaging for customers and garner greater market share for Canon in India. Along with the launch of 85 new products, Canon also introduced the 10 technology “firsts” from Canon across product categories.
Alok Bharadwaj, Senior Vice-President, Canon India, said, “The highlight of this launch of the introduction of 10 new technology ‘firsts’ from Canon. Canon aims at increasing its market share considerably across all product categories. The year 2009 will also see us focussing significantly on tier II and III cities, thereby reinforcing Canon’s leadership in these markets.”
The products launched include Canon’s entry into two new categories of Cable ID printer and card printer. These printers are being launched under the name of NISCA which is a fully-owned subsidiary of Canon Finetech Inc, Tokyo. These printers are exclusively used for printing and writing electronic information on plastic cards. The market size for this printer is approximately Rs.100 crore and it is growing at 30% per annum. This is being used by segments such as corporate ID cards, education, telecom, transportation, banking, hospitality, retail, etc. This is currently a disorganized segment and Canon is entering this market which hopefully will now attract more organized players. Canon will be conducting this business through distributors and card print service providers.
The Cable ID printer is a niche market and these products are used for printing on sharp, durable and weather-resistant lettering on any labels or tubes like construction, control panel and manufacturing industries. The market for this segment is approx Rs.100 crore and growing at 33% per annum. Canon will be distributing these through a national distributor based in Pune, called Onyx.
Along with the launch of 85 new products from Canon, Canon also introduced the 10 technology “firsts” from Canon across product categories. Some of these include:
1. High Definition Video in SLR – EOS 5D Mark II is the first D-SLR which enables still photography even while shooting movies. It also has a live view function setting – [Disable, stills only, or stills+movie]. The movies recorded in MOV format (Playable & editable via zoombrowser/Imagebrowser). Full HD (1920 x 1080) or standard SD (640 x 480) 30 fps movie recording is possible.
2. Digic IV Photo Processor – This processor is the fastest processor for digital cameras for Canon.
3. iP v 6 – This is the first application from Canon which is ready for version 6 Internet protocol which is the future of communication.
4. Auto Photo Fix – This new technology from Canon enables correction of still images while printing. It can correct imperfections like red eye, skin tone, contract, etc. while printing the images with its intelligent software. This application is being introduced for the first time by Canon in its Photo All-in-Ones.
Talking about the road ahead for 2009, Konishi said, “For the past two years, Canon has been focussing on establishing strong infrastructure. We have created world-class showrooms and have nearly doubled our sales staff from 400 to 730 people. Hence, one of our foremost focus in 2009 will be to leverage on this investment and enhance productivity and effectiveness of our people.”
To take the business strategy forward, Canon will be focussing on the following five key areas:
* Creating Digital On Demand Printing – This is a new category created by Canon where they have launched new Colour Presses and have identified business opportunity in areas like photo book printing, and graphic arts segment.
* Penetrating Government and SI Business – E-governance projects have opened up new vistas of opportunity. Canon has spotted IT peripherals in System Integrators to be a major opportunity for growth.
* Thrust on Laser Printers – The laser printer business has grown substantially over last year and our major marketing initiatives have reaped good success. This area will continue to be a big focus with the SOHO and SME areas.
* D-SLR in Consumer Hands – Digital cameras is Canon’s strength and in D-SLR Canon has a dominant share of over 50%. In 2009, Canon will focus on getting D-SLR into consumer homes and families.
* City Specific Marketing – After successful campaigns in Mumbai, Delhi and Bangalore, Canon will continue its marketing strategy of focussed city-specific campaign, whereby all advertising and below-the-line marketing activities are customized to the specific city. This project will now be launched in Chennai and is also travelling to smaller cities such as Chandigarh, Jaipur, Kochi, Guwahati, etc. as “Print City” project.
Bharadwaj added, “The year 2009 will witness focus on enhancing product portfolios across categories, innovative marketing coupled with faster response to the market dynamics, expansion of retail presence and introduction of new technologies. Analyzing the Indian market, Canon India has made a business decision to make a concerted effort to reach out to regional markets this year. To increase penetration in tier II and III markets, Canon has implemented innovative marketing tactics like road shows and exhibitions to educate and connect with the huge consumer group.”
The company is also targeting largely on the government sector and is hoping to clock around Rs.150-crore revenue from e-governance projects like CSEs and SWANs. The government sector contributed Rs.50 crore to the company’s revenue last year, which is expected to double to Rs.100 crore by the end of this year. Canon’s retail presence is expected to increase to 4,000 outlets by December 2008. Canon India is expected to touch a revenue of Rs.700 crore in 2008. The company clocked a revenue of Rs.510 crore in 2007.
