I’d Prefer Not to Believe This

(news & commentary)

Nikon has posted a series of translated Q&A’s from their Medium Term Management Plan of last week. For example:

Q: What can you tell us about future marketing strategies?

A: The total number of D-SLRs, interchangeable lenses and compact digital cameras sold over the last 10 years amounts to around 200 million, which means that we have information on an approximately equal number of customers. We will analyze this information to launch new products and to offer Nikon users ideas for new products and encourage to replace older ones in a timely manner.

Let’s hope that they don’t do this. Gee, has anything changed about the camera industry in the last ten years that might render those 200m units Nikon sold as not meaningfully predictive? Hmm. Smartphones. Mirrorless. Google Glass. Lytro. Just to name a few things that might have changed the landscape during the time that data was being collected.

Let’s do the informal analysis of that 200m units for them and see what happens:

  • Most of those units were Coolpix. So make more Coolpix!
  • Hardly any of those units were Nikon 1’s, so stop making Nikon 1’s!
  • D300 sales dried up progressively since 2007, so don’t make any update to that!
  • D700 sales went to zero when we stopped making it, so obviously don’t update that.
  • D4 sales were less than D3s sales were less than D3 sales, so don’t make a D5. 
  • PC-E lens sales were dismal, so never put out the 17mm PC-E that was designed.
  • Most of the lenses sold were consumer zooms, so make more of those!

Yeah, right. Analyzing the sales of the last 10 years will just have them make all the wrong decisions all over again, plus get them to make a few new wrong decisions. 

A more correct analysis would yield the following:

  • Colors were an inventory hassle that didn’t work out in terms of sales. Indeed, many of the colored cameras ended up lingering in inventory because dealers didn’t want the extra SKUs. If you’re going to do color, do it as an aftermarket add-on. 
  • Nikon 1’s sell at lower prices, don’t at higher prices. If you can’t drive costs out of them, then yes, drop the line. But there’s another problem, too: none of the designs resonated with users. Virtually all weren’t what people wanted in a camera design. So you’d have to fix the camera designs to really see if you could sell Nikon 1’s in quantity.
  • Nikon failed to update some of their most profitable and significant products: D300, D700, 24-70mm f/2.8, 300mm f/4 to name just four. Meanwhile, if Nikon would look at what the m4/3 and APS mirrorless cameras are selling for lenses, they’d discover they don’t have many of those options for the one DSLR line Nikon sells the most of: DX. Don’t have them at all. Which means no sales. 
  • Nikon owners aren’t exactly happy with the company right now, so “encourage to replace” is going to have to be coupled with more than a marketing message.

If you haven’t figured it out, there’s a not-so-subtle difference between “what worked” and “what should work.” In the former, you’re looking backwards and basically substantiating the decisions you’ve already made. In the latter, you’re trying to think like a customer and figure out what they really need. Nikon is doing less and less of the latter, and now seems to be announcing they’re going to seriously embrace the former. 

It’s almost like treating the customer like cattle. “Well, when we fed them X, they fattened right up, so let’s feed them X again.” It won’t work. The cattle don’t like X any more. They want Y. Or Z. Or something different and better. In the few cases where they want X again (D300 update and D700 update), for some reason Nikon thinks they don’t. 

Just how disconnected from their customer is Nikon? Hard to say for sure, as often external statements like the one I quoted above are just filler that the company thinks will somehow placate investors (it won’t). But I’d have to say the evidence is mounting that Nikon is fairly dramatically distanced from a large group of their customers at the moment. 

Nikon now appears to be a company where things weren’t broke, but they broke them anyway. The lists of features, performance, and products that actual Nikon users want grows longer every day, and it’s getting somewhat rarer that a new product announcement from the company actually deals with one of those. Not that the users are always right. But I sure hear a lot from Nikon users who are waiting for something and not getting it. Seems to me that there’s plenty of opportunity in that. Enough so that other companies are slowly sucking some Nikon users away when they offer that opportunity. 

Maybe I should write a play: Waiting for Nikon. 

Act 1, Scene 1

Nikon User 1: Nothing to be done.

Nikon User 2: I'm beginning to come round to that opinion. For several years I’ve tried to resist that, saying to myself, products will eventually come.

Nikon User 1: Suppose we repented?

Nikon User 2: Repented what? Owning a Canon product of some sort?

Nikon User 1: Maybe. Then again, they didn’t say they’d offer us anything.

Nikon User 2: So what if we don’t get anything?

Nikon User 1: We’ll just wait. 

Nikon User 2: And wait some more.

Yes, I’m being sarcastic. Good thing I was shooting with a 1Dx this past weekend (foreshadowing). 

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