Eastman Kodak Company: Funtime Films Case Memo

To:                Inese Eglite

From:                Karina Galicka

Date:                January 27, 2017

Subject:        Kodak case memo

Question: Is Kodak doing the right thing with the decision to have line extension: Kodak Gold Plus, Kodak Royal Gold and Kodak Funtime? Support your statement.

In this case was showed that in past 5 years (from time case was written) Kodak market share have been eased by 6% (from 76 to 70 in 1993), all because strong competitors have been wooed customers with low price versions of films.

To keep market share and have possibility to gain its lost market share, there was implemented 3 categories of films, to adapt to any maker segment.

So my answer to the question will be that, yes, line extension should work, as 60 and 40 percent of advertising will be moved to Gold Plus and Royal Gold to stabilize already existing customer and to attract new ones for Royal Gold (that film will work not only for professionals but as well amateurs in special moments). Moreover, Funtime as a budget option for people who know Kodak for its   quality, only for lower price.

Because:

• They have sustained with its known brand – the largest selling brand of film – Gold plus and invest about 60% of its marketing.
• Royal Gold to enter super premium segment and to replace Ektar, which is now working for professionals, and is positioned as film for “very special occasions” – with same quality as Ektar, only for broader audience (this brand will receive 40% of marketing budget). This brand would show that it is good enough as gold plus, however phrase “royal” marks its superior quality.
• Funtime available in limited quantity and seasons. It is positioned as economy brand and available only in value packs. As Kodak positioning themselves as good quality brand, then with Funtime it might be risky, as it is new implementation, however they are not investing anything for advertising.

Best regards,

Karina Galicka