A (very) brief and personal view of the Camera Retail Industry: the end of innocence.

[AndyS]

Not long after Canon other brands introduced entry level amateur products. The market grew faster with more ad $$ and choices. At this time I was working directly for Olympus selling to retail outlets.

Then a most terrible thing happened: the mass marketers got involved. These weren't camera stores, they were money movers. It could have been insurance or drugs, made no difference. They used the market built by the camera makers to basically rip open the customer's wallets and scoop the money out. The marketing model is the same regardless of the product: let someone else establish a market, advertise easily compared prices on major products and capture customer share with low prices. There was usually ONE marketer in every major market. They put the mom & pop shop out of business and with it any concern for building a relationship with the customer.

Sounds great right? Lower prices for consumers through competition, what could be better! During the '80s a consumer could literally buy a camera at dealer cost less any early payment discounts! Published price in the dealer catalog was $199 with standard lens, minus 5% for 30 day terms is $189. Hell of a deal except they still have to keep the lights on and make a shit load of money. They did that with 'add on sales'. You had to have a filter to protect the lens at $10 (cost .15 so all that optical quality is run through .15 glass!) and a case at $19.99 (cost $4 and it fell apart in three months) not to mention the biggest rip off of all, the EXTENDED WARRANTY! The average $200 camera sale ended up at $450! All of it junk.

Sales people were paid on a variable commission with minimum hourly wage. That filter you bought earned $1. The case $2 and the EXTENDED WARRANTY $10. Then the camera makers got involved and offered their own commission outside the camera store. If you bought a Minolta, Nikon or Pentax in the '80s you paid the employee anywhere from $5 to $10! So if you think the salesperson had any concern for your needs, you were sadly mistaken.

Both the camera makers and the mass marketers drove the price (and the concern for building long term customers) into the dirt. If that wasn't enough the product was used for currency exchange. Buy international product with one currency, sell it with another and skim off the exchange rate. It was called the “gray market” and had no US warranty. You were on your own to find somebody who wanted to service the product.

It was the absolute worst time to be a customer or a salesperson. I sat in management meetings discussing how much harder we could push the sales staff before we burned them out entirely. As often as not we guessed wrong and really screwed up some young people's lives.

The only saving grace was that the consumer could not buy a bad product, they all performed well beyond what the average entry level photographer could exploit.

Part 3 follows.

[msongs]

1. way too many models of cameras many of which have the same features other than brand names.....

around year 2000 when I went digital I spent a lot of time studying various ones and the choices were too much....like the grocery store cereal aisle lol

[Lemonwurst]

2. Cameras aside, a very insightful look a free market capitalism

Very well written, thank you. What you’ve described is consistent overall with how I saw the 80’s to 90’s as an economic era with zero regard to sustainability, and something that continues to this day despite all consumer-friendly aspects already having been decimated during the period you covered.

I take small comfort in predicting that capitalism, and more accurately the free market economic model, has an inherently limited lifespan, caused by this type of acceleration into instability. It may even be happening now, though the optimist in me hopes we’ll have more time to establish a better, longer-term economic model.