Taking Sides Case Analysis-Avon Products, Inc

Marketing Audit Approach

Canon Inc. was founded in 1933 and headquartered in Tokyo, Japan. Canon has become one of the world's leading manufacturers of electronics, primarily optical electronics. Canon brand is a registered trademark in more than 200 countries and regions worldwide. Regional marketing headquarters oversee operations across Canon's global sales network: Canon U.S.A. in North and South America; Canon Europe in Europe, Africa, and the Middle East; Canon China in Asia outside of Japan; and Canon Australia in Oceania. Canon is one of the top 10 companies receiving U.S. patents.

Products/Services

Current, the demand for digital cameras has rapidly expands both in the United States and globally. The market consumption volumes rose significantly over the past years and generated total revenues of $42.08 billion in the year 2004 (www. Datamonitor.com).

Canon has a history of innovation that has brought it a leadership position in the technology industry. Canon manufacture cameras, including compact, digital, camcorders, projectors, SLR, business machines, including copiers, printers, scanners, fax machines and related products, optical products, including production, medical and broadcasting equipment, and digital radiography systems. Furthermore, Canon brand is a register trademark in more than 200 countries and regions worldwide.

Customer

In regard to business machines such as optical products, medical and broadcasting equipment, and digital radiography systems, Hewlett-Packard is one of Canon's biggest customers. In 2003, Canon generated approximately 20% of its net sales profit from Hewlett-Packard (www. Datamonitor.com).

Canon's other potential customers are professional and home users who are more interested in the digital cameras. The geographic aspects uses of Canon's product has expanded worldwide including North and South America, Europe, Africa, Middle East, Australia, and Asia.

Canon strives to be a truly excellent company, a company that is trusted and respected over the world. With Canon products, users are assured convenience, enjoyment, simplicity and peace of mind. By choosing Canon, customers are supporting Canon's environmental conservation efforts. As always, Canon continues to pursue innovation for a better tomorrow.

Canon pays close attention to customer needs and proposes solutions that enable customers to use increasingly sophisticated and complex information networks with greater ease, convenience, and efficiency, and remain in step with global advance of information technology.

Markets

It is estimated that over the next five years, the market for the digital camera will expect to increase to a value of $54.56 billion by the end of 2009. Such increase will result from the rising demand for digital cameras in the Asia-Pacific's emerging markets. In 2004, the rapidly expanding demand for digital cameras was sold at 68.6 million units (www.Datamonitor.com).

Competitors

The digital revolution in recent years has led to a massive change in the photographic products marketplace, and with many companies striving to innovate quickly in order to boost revenues it has bring in many competition. However, keeping pace with the market's development bears significant rewards, driving sales growth at the cutting edge end of the market. The major competitors of Canon are Konica Minolta Holdings, Inc., Nikon Corporation, Ricoh Company, Ltd., and Xeron Corporation.

Pricing

The global business for Canon was strong in the first half of 2004, driven by ongoing growth in the United States and China. While Asian sector generally reports economic expansion, and experience only moderate growth. Overall, Fiscal 2004 revenue growth in sales of digital cameras and color network digital multifunction devices (MFDs) are significantly higher demand for semiconductor production equipment. Furthermore, sales of digital cameras climbed 16.8% which value at US $7,337 million, and sales of other optical products jumped 26.9% which value at US $3,046 million (www.Datamonitor.com).

SWOT Analysis

Canon is a global manufacturer of business machines, computer peripherals, cameras, and other optical products. Canon has a strong brand image. The company faces the threat of decline in revenues from increasing sale of counterfeit products.

Strengths

The strengths of Canon are the strong brand image, wide range of products, cost reduction strategy, and the company's research and development.

Canon maintains a strong leadership position in the manufacturers of copiers, cameras, and semiconductor equipment. In 2004, Brand week magazine ranked Canon number one in the office copier industry category. In reduce currency exchange risks and production costs, Canon has increased overseas production and the use of local parts.

Canon has intensive research and development center over the globe. For example, the research in Japan develops basic and advanced technologies for future businesses in a time frame of five to ten years while other centers in Japan develop key components, environment-conscious technologies, next-generation displays, and electronic devices.

Weaknesses

The weaknesses of Canon are the dependence on Hewlett-Packard for a significant part of its business, lack of product differentiation, and the company's photocopier segment.

In fiscal year 2003, almost 20% of Canon's net sales were made to Hewlett-Packard. This places Canon at a disadvantage because if Hewlett-Packard were to reduce the scope to purchase less from Canon then the company's sales revenue will be significantly reduce. The company's lack of product differentiation is a disadvantage because it has little choice to follow the lead if Hewlett Packard, the market leader were to reduce their pricing strategy.

The company introduces no new photocopier since the debut of the iRC3200 in 2002, iRC3100 and iRC6800 in 2003 loss the market share to Fuji Xerox and Ricoh in the domestic market in January-March