Parks Associates Blog

Friday, January 11, 2008

Digital Photo Frame a Bright Spot at CES08

The list of brands that join the digital photo frame market has grown much longer. At the just finished 2008 International Consumer Electronics Show (CES), more than 80 vendors, by my rough count, demonstrated their photo frame products, compared with fewer than 30 a year ago. Are vendors overzealous about this category? Concerns about oversupply are unfounded, at least for the near future, because for two years in a row, consumer demand has outstripped supply and vendors wished “we could have produced more.”

Although the true size of consumer demand is still unknown, vendors already felt pinched because of so many competing brands out there. Small vendors are even more worried as newer, bigger names like Samsung, HP, Viewsonic are likely to further erode their presence at retail and crush their already fragile component supply. Therefore the mantra at this CES for the digital photo frame is "differentiation." Although bigger frames (ranging from 19- to 32-inch) were announced, I was more intrigued by designs that mingle photo frame with other gifting ideas, making them look less like a consumer electronic device but more like a piece of “digital furniture.” For instance, Mustek is the first to make the frame a docking station for iPod. Smartparts introduced a model that can print pictures from the back panel. Even bolder is Audiovox’s move to make the photo frame attachable to a fridge in the kitchen. Audiovox no longer calls the product a photo frame, but a “family message center” because with it, a kid can leave a photo, voice or video message to his or her dad and mom.

I like the experimental spirit with the photo frame category during the show. It manifests how dynamic this market is and how versatile the product concept could be. But deviation from the core function is a risky proposition and could potentially cut the breadth of appeal among consumers. I hope all the innovative designs will be accompanied by a smart marketing campaign, so that a novel product idea can spur solid consumer demand. Time will tell, in six months or less.

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