PMA places in-store printing solutions atop 2005 agenda

ORLANDO, FLA. -- The mood at the Photo Marketing Association's annual convention and trade show this year was cautiously optimistic as the photo industry sees digital cameras being embraced by the mass market while a second wave of camera buyers seek to upgrade lower-resolution units. And retailers and vendors are gearing up for what may finally be increased printing of digital images.

According to PMA, 20.5 million digital cameras will be in U.S. households by the end of this year, increasing the number of digital prints made to 7.7 million from 5.1 million in 2004. This is good news for the industry and for retailers that have seen photo processing decline in recent years.

"If you look at the data, there's no question that there's been a heavy transition period between the drop-off in analog and the growth in digital," said Gary Pageau, PMA's spokesman and publisher. And while prints of digital images haven't supplanted those lost from film, consumers are starting to use that elusive print button.

According to InfoTrends/Cap Ventures, retail is finally on its way to surpassing home printing as the number of prints made at stores in 2004 increased to approximately 22% of all images captured digitally, up from around 5% the previous year.

The practice of uploading photos to retailers' sites for in-store pickup is still in its infancy but shows much promise. According to InfoTrends, 7% of digital camera owners who printed images did so online, and that is expected to increase. According to Grant Pill, director, photo processing, CVS, "There's a world of duality," in how consumers are printing. "There is growth in both markets."

Sales of cameras are going strong, particularly as consumers buy replacement or additional units. Although first-time digital camera buyers largely dominated the market in 2004, InfoTrends predicts that by 2006, nearly two-thirds of all units sold will be to current digital camera owners. This statistic is driving design trends within the industry, and manufacturers are responding to consumer feedback. New cameras on display at PMA featured the inevitable higher resolution but also larger LCD screens and more features such as powerful zooms, higher-quality lenses and optional settings that more closely mirror point-and-shoot film cameras.

And those consumers are beginning to behave like the film users of old. "If there was a trend at this year's show, it really is the opportunities beyond the snapshot," said Pageau. "There was a lot of interest in things like Epson's scrapbook kit that marries the opportunities for retailers of digital with [what] people like to do with paper and prints."

While the bulk of scrapbooking activity still lies in the traditional realm, products such as Epson's offer complete kits that produce hardbound books of printed digital images for less than $20, and new online services produce gift cards digitally for only slightly more than the cost of a typical greeting card.

Show attendees were treated to the latest generation of kiosks and digital minilabs. While there were no radical advances, vendors are offering more options and enhancements to equipment designed to better serve consumers' printing needs as they evolve.

"Sometime next year is when we'll really start to see a strong uptick," reports Pageau. "There are 80,000 places you can drop off a roll of film in the United States, and only half of those are digitally enabled right now." The retailers that are winning with consumers are those who already have invested in the market, according to Pageau.

"The question is not 'To kiosk or not to kiosk,' but how many you have and in what configuration," said Pageau. "The joke on the floor this year asked how many is the right number of kiosks. The answer is: The right number of kiosks is always one more than what you have."

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