How Did Fuji's APS System Impact the Point and Shoot Camera Market?

[mouse]

In the early 1990s, Fuji Photo Film, USA, joined forces with four of its rivals to create the Advanced Photo System (APS), which is hailed as the first major development in the film industry since 35 - millimeter technology was introduced. In February 1996, the new 24 millimeter system, promising clearer and sharper pictures, was launched. By the end of the year, the lack of communications and a limited supply of products made retailers angry and consumers baffled. Advertising was almost nonexistent. Because the product was developed by five industry rivals, the companies had enacted a secrecy agreement in which no one outside of company management, including the company's sales force, would know details about the product until each company introduced its APS products on the same day. When the product was actually introduced, it came with little communication to retailers about the product, virtually no training of sales representatives on the product ( so that they could demonstrate and explain the features ), and a great underestimation of demand for the product. Fortunately, Fuji pressed on by taking an "honesty is the best policy" stance and explaining to retailers and other costumers what had happened and asking for patience. In addition, Fuji increased its research to better ascertain market positioning and size. By 1997, Fuji had geared up production to meet the demand and was increasing customer promotion. APS products were on the road for success. By 1998, APS cameras owned 20% of the point and shoot camera market.

1. As stated, by 1998 APS cameras owned 20% of the point and shoot camera market. Now it is the year 2003 and the market share might be nearer to 40%. Suppose 30 cusomers from the point and shoot camera market are randomly selected. If the market share is really .40 , what is the expected number of point and shoot camera customers who purchase an APS camera? What is the probability that six or fewer purchases and APS camera? Suppose you actually got six or fewer APS customers in the sample of 30. Based on the probability just calculated, is this enogh evidence to convince you that the market share is 40% Why or why not?

2. One study of 52 product launches found that those undertaken with revenue growth as tha main objective are more likely to fail than those undertaken to increase customer satisfaction or to create a new market such as the APS system. Suppose of the 52 products launched, 34 were launched with revenue growth as the main objective and the rest were launched to increase cusotmer satisfaction or to create a new market. Now suppose only 10 of these products were successful ( the rest failed) and seven were products that were launched to increase customer satisfaction or to create a new market. What is the probability of this result occurring by chance? What does this probability tell you about the basic premise regarding the importance of the main objective?

 

[mouse]

anyone

 

[thepatientmental]

1. To calculate the expected number of customers who purchase an APS camera, we can use the formula for expected value: E(x) = n*p, where n is the number of customers and p is the market share. In this case, n=30 and p=0.4, so E(x) = 30*0.4 = 12 customers. This means that we can expect 12 out of 30 customers to purchase an APS camera.

To find the probability of six or fewer customers purchasing an APS camera, we can use the binomial distribution formula: P(x≤6) = Σ (nCx)(p^x)(q^(n-x)), where n is the number of trials, p is the probability of success, and q is the probability of failure. In this case, n=30, p=0.4, and q=0.6. Plugging in these values, we get P(x≤6) = 0.0006. This means that there is a very small chance (0.06%) of getting six or fewer APS customers in a sample of 30.

However, this probability alone is not enough evidence to convince us that the market share is 40%. We would need to conduct further statistical analyses and gather more data to make a more informed conclusion.

2. The probability of this result occurring by chance can be calculated using the binomial distribution formula: P(x=7) = (52C10)(0.5^10)(0.5^42) = 0.0008. This means that there is a very low chance (0.08%) of getting only 7 successful products out of 52 by chance.

This probability tells us that the basic premise regarding the importance of the main objective may not be entirely accurate. While launching a product with revenue growth as the main objective may increase the likelihood of failure, it does not guarantee success. Other factors such as customer satisfaction and creating a new market may also play a significant role in the success of a product launch.