The Evolution of Retail Photo-publishing

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Proving any cynics wrong, the availability of home photo-printing solutions has far from put an end to growth in the photokiosk market.
 
By Holger May, Category Manager, Retail Publishing Solutions, EMEA, HP

Photo publishing was first seen in the retail industry in the 1980s, propelling photography from an elite activity to a mainstream commodity. Retailers installed photo printing equipment which took up valuable floor space and invested in specially trained staff to handle hazardous chemicals. The investment paid off and the industry progressed. Consumers were first offered a one-hour photo service in 1986 in Omni Superstores, USA, a service which was rolled-out globally in retail stores throughout the 1990s.
 
The retailer became synonymous with the analogue photo printing experience. Consumers relied on trained staff and specialised equipment to transform captured moments into printed photographs.
 
The advent of digital photography, though, has changed this and has empowered the consumer with photo publishing alternatives. Consumers can choose which photos to print and how they would like to print them, whether through online ordering, at home with enhanced photo printers, or in the retail environment at photokiosks.
 
The anticipation of seeing a photo for the first time has shifted from the retail environment to the digital camera window or the computer screen. The role of the retailer has also changed in the digital landscape: new consumer habits pose a significant revenue and footfall opportunity for retailers. Retailers now have the opportunity to redefine their role in the digital photo publishing landscape by embracing advances in retail photokiosk and photo publishing technology to meet the shifts in consumer behaviour.
 
The market today
 

While consumers have much more choice in where they print their photographs, retail photo printing is very much still in demand and consumers will continue to value processing services. However, there is now a new emphasis in retail photo printing with commodity printing shifting to creative printing. Consumers are embracing the ability to personalise photographs and purchase creative photo products; retailers are in the perfect position to take advantage of this trend with the creative merchandise now on offer at photokiosks. There is now a significant and timely opportunity to engage with consumers through creative photo publishing.
 
IDC predicts that worldwide creative photo merchandise revenue will grow by 40.6% CAGR from 2008-2013 (IDC Worldwide Creative Photo Merchandise 2009-2013 Forecast: The Creative Print Bible, March 2010 #222487). To remain at the forefront of photo publishing retailers must offer consumers a choice of on-demand, customised creative products such as photobooks, calendars, greeting cards and posters. Photobooks have already proven to be a huge success with consumers. In 2008 the photobook market dominated the photo-merchandise segment, accounting for 52% of value demand in Western Europe. (Futuresource Consulting, Photo-merchandise market report: Western Europe, January 2010). Retailers must begin to offer creative merchandise to capitalise on consumer trends. The time is now to invest in creative photo publishing technology.
 
The opportunity
 
The photo finishing and photokiosk industry presents a significant opportunity for retailers. Between 2009 and 2010 the retail photo finishing industry doubled. HP anticipates the industry will be worth €56 billion by 2013. Retailers that have implemented the retail publishing approach are experiencing significantly better than industry average year-over-year growth, by as much as 20-30%.
 
Since 2006 HP has seen more than one hundred retailers across three continents embrace retail publishing solutions. In 2009 HP partnerships grew by high triple digits and HP accelerated its footprint across EMEA. HP’s global retail publishing presence is expected to grow by more than 300% in 2010. Over the last year, HP expanded its customer portfolio through agreements with leading retailers such as Duane Reade, Tesco and Kmart Australia. Retailers who do not embrace this retail opportunity will miss out on the significant growth that this industry is experiencing.
 
New photo-printing outlets
 
Digital printing has brought a wealth of new opportunities to the retail market, for both big and small retailers. Retail publishing is no longer reserved for large supermarket chains; the compact size and convenience of the HP Photosmart range, which encompasses the Express Kiosks, Microlab and Photo Center, enables local stores and even motoring service station outlets to offer customers quick and simple photo printing solutions.
 
The ML1000D, which launched in 2009, was one of the industry’s first dry, inkjet minilabs, enabling in-store, one-hour production of duplex photo books and calendars in 22 x 28 cm and 30 x 30 cm sizes. The ML1000D delivers up to 1,500 10 x 15 cm prints per hour and photos in sixteen different print sizes as well as duplex photo books and calendars.
 
Dry, inkjet technology also provides environmental benefits for retailers. The ML1000D takes only ten minutes from standby mode to start up, significantly freeing up labour so store associates can focus on sales and customer service. There is also no need to train staff in hazardous chemical handling.
 
The ML1000D also consumes almost three times less energy than traditional silver-halide photo-finishing systems, helping retailers save up to €737 per machine per year and an average of 3,637 litres of chemical and water discharge per year. Switching all traditional silver-halide minilabs worldwide to HP retail publishing solutions would save more than 38.6 million litres of fresh water each year.
 
Future trends
 
Looking to the future of photo-retail, some trends emerging today are certain to continue. Customers will be even more creative and adventurous with photo publishing. As long as the price point remains attractive in-store, customers will continue to look for new ways to customise their photographs.
 
Content will also play a significant role in the future of retail photo printing. According to The Licensing Letter, a publication from research company EPM Communications, the worldwide consumer spending on licensed merchandise exceeds €74 billion annually, €22 billion of which is print-based. HP is expanding its content partnerships across the globe, bringing consumers access to more than 300 licensed properties from 20 licensed content partners, including Live Nation Entertainment, Warner Bros, Sesame Workshop, Nickelodeon and National Geographic.
 
The retail photo publishing landscape has changed dramatically in the past thirty years, but we are now experiencing a renewed energy and growth potential fuelled by the advent of digital photography. Retailers have the opportunity to redefine their role at the heart of retail photo publishing.