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Retailers: Cameraphones Won’t Derail Digicam Sales

2/20/2005 02:07:00 PM Eastern

New York — As digital cameras enter the summer of their mass market acceptance, new technologies are encroaching, most notably camera equipped cell phones and improving still capture in digital camcorders.

Do these new technologies threaten to derail what has been, to date, unimpeded double-digit category growth? Not yet, retailers say.

“If someone wants a good picture, they’re going to buy a still camera,” said Kristen Elder, purchasing director, Ritz Camera Center.

Elder also noted that while consumers are not willing to pay more for video features in a still camera, they have been willing to pay a premium for still features in a video camera.

“Camcorder makers have been able to charge a premium for still photography features,” Elder observed.

“Convergence continues, but it will be a long time before a still camera can replace, say, a video camera,” said Glenn Cunningham, consumer electronics director, Amazon.com. Multifunction devices always lose out on head-to-head comparisons with standalone devices, he added.

However small business clients, like the type that shop at Office Depot, have found use for converged features, argued Paula Martin, digital camera merchant, Office Depot. “It won’t replace a video camera, but it’s a useful feature.”

Convergence is also helpful in its potential to consolidate shelf space, Martin added.

“It’s good if it keeps prices up,” noted Mark Sasicki, electronics buyer, Apt Electronics. “It’s new technology and it gives you something to talk about” other than megapixels, he added.

While consumers continue to buy based on resolution and to a lesser extent, zoom, brand remains “very important” to consumers, Elder said. “You can’t do over a picture. The consumers have to have trust in that brand.”

While some electronics brands, such as Sony, have faired well against photographic rivals, others have yet to gain a similar foothold. “When it comes to things like images and lenses, some brands don’t have the same resonance with consumers,” Martin said.

In addition to robust sales of cameras, retailers were heartened by a healthy market add-on sales, pointing to strong sales of flash memory cards, batteries and cases.

One accessory sale that presents a quandary to some retailers is a memory card, Elder said. “Consumers are archiving their photos using flash memory cards, they’re apprehensive about taking photos off the cards, and we don’t think that’s the best way for consumers to archive their photos.” Better archival solutions exist, Elder said, pointing to CD backs, online and hard disk storage.

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