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KMG Licenses Kodak To Sell Optical Media

1/13/2010 03:49:37 PM Eastern
Rochester, N.Y. - KMG Digital, a company that includes several key former Memorex executives, has obtained the exclusive worldwide license for Kodak-branded optical blank media products and media accessories.

Mike GolacinskiHeaded by former Memorex CEO Mike Golacinski, Rochester-based KMG (formerly KMP Media) will market Kodak-brand recordable optical blank CDs, DVDs, Blu-ray discs and media accessories, with a focus on the office superstore, electronic specialty, discount and member club channels, as well as strategic online partners, the company said.

Golacinski headed Memorex Products from 1998 until its sale to Imation in 2006. Under Golacinski's tenure as president and eventually CEO, the Memorex brand became the market leader. Golacinski was also executive VP of Maxell Corporation of America prior to his time at Memorex.

Industry veterans Steven Mizelle, Jim Gordon and Robby Williams have been retained by KMG Digital. Mizelle is VP and COO and manages the Rochester sales and operations facility. Gordon is international sales VP, directing sales to Latin America, Asia and Australia. Ten-year KMG veteran Robby Williams is operations director.

Also on board at KMG: two former Memorex sales VPs - Pete Steriti, as KMG's senior U.S. sales VP, and Ed Coughenour, sales VP, western region.

Golacinski is based in KMG Digital's Los Angeles office along with former Memorex product planning director Brad Yeager, KMG's new marketing director. Yeager spent 10 years at Memorex with Golacinski.

European operations will be headed up by managing director Jean-Paul Eekout, based in The Netherlands. Eekout previously was worldwide director for the TDK brand.

"We see a tremendous opportunity to bring both innovation and efficiency back to the optical media business while we evaluate other CE categories that we'll develop and market with the Kodak brand name," Golacinski told TWICE. "Without any burden of legacy issues and with our experience in the industry, we've put together a veteran team to bring excitement and value back into the media business."

Asked why he decided to return to the category after several years away, Golacinski remarked "Most of my career, if not all of my career, has been in removable media ... it's kind of in my blood. And we saw an opportunity. Optical media is a mature to slightly declining category, true, but it's still a $2.5 billion global business, with $650 million to $700 million of that in the U.S."

"We also think the industry over-consolidated in the past few years," he continued, "not only on a brand level but on a manufacturing level. Globally, you have only two or three prominent brands and the vendors that are out there are pretty heavily structured - large companies who are involved but not focused on removable media, or treating it like a harvest category. We are far leaner, faster moving, and in a promotional commodity category that can be a great advantage. And this category is too vibrant to be relegated to the background."

Golacinski spoke of the strength of the Kodak brand on a global level. "The entry points to this category are distribution and a strong brand. I don't think you can enter any retailer anywhere and not find them carrying at least some Kodak products. The distribution base is quite large."

In terms of marketing, KMG is taking a different approach than has been the norm in the category. "The standard high/low price strategy has seen better days - some variation on an everyday low pricing approach seems to make the most sense in this environment," Golacinski said. To that end, KMG has created specific pricing model options tailored to specific channels and even specific retailers. "This is where we see our ability to make decisions quickly pay off."

On the market now under the Kodak brand are blank CDs, DVDs, Blu-ray discs and media accessories. "Our global distribution is ahead of our U.S. distribution a bit - we are already a top three player in some international markets," Golacinski said, and KMG has its sights set on the U.S. market in 2010, now that the company's sales network and rep networks are in place.

Golacinski promised an expansion of the franchise this year, expanding into a few new (as yet unspecified) product categories as well as shipping an eco-friendly line of recordable media, complete with environmentally friendly packaging, by the late second quarter or early third, in time for the holiday selling season. Further technological differentiation of current product is also on tap. "The category is not dead - it just needs a shot of new energy, new excitement. We're here to do that," he said.
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