The Kodak - Fuji Rivalry
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Case Code : BSTR037
Case Length : 10 Pages
Period : 1998 - 2002
Organization : Eastman Kodak Company, Fuji Photo Film
Pub Date : 2002
Teaching Note : Available
Countries : USA
Industry : Photo films
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This case study was compiled from published sources, and is intended to be used as a basis for class discussion. It is not intended to illustrate either effective or ineffective handling of a management situation. Nor is it a primary information source.
Fuji in the US
Founded in 1934, Fuji Photo Film had its headquarters in Tokyo, Japan. The company first entered the US market in 1964 as a supplier of private label film and established its first subsidiary in 1965.
Since the beginning, Fuji focused on providing quality and innovative products to its US consumers. The company spent millions of dollars to design a new 8-mm home movie system. In 1967, when Fuji planned to introduce the movie system, Kodak introduced its Super 8 movie camera, which had a larger film format that could not use Fuji film. Since Kodak had introduced its new system ahead of Fuji, Fuji shelved the plan of introducing its system in the US. After this, Fuji felt that it made more strategic sense to follow Kodak's lead, avoid attracting Kodak's attention, and not take any steps that would provoke Kodak's retaliation. The company focused on building its marketshare in the US by adopting strategies to get the share of weaker US competitors rather than that of Kodak...
Kodak in Japan
Though Kodak entered the Japanese market in 1905, the company never took the Japanese market seriously. In the early 1980s, Japan emerged as the second largest market in photographic products.
Due to the rising competition from Fuji in the US, Kodak decided to strengthen its competitive position in Japan. In 1977, Kodak strengthened its control over the distribution and marketing efforts of its Japanese arm Nagase & Co. In the following year, the company formed a joint venture company named Kodak-Nagase. Later, Kodak converted the import division of Nagase into its own subsidiary and was renamed as Kodak-Japan. After setting up a subsidiary, Kodak increased its workforce to 4500 from a mere 12. Tying up with the Japanese partner helped Kodak to have access to 60,000 camera stores up from the initial 30,000 stores in Japan. It gave Kodak access to more shelf space to display its products. However, Kodak could not get into the stores, which marketed Fuji products exclusively...
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