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Customers become more price-sensitive. In addition, since buyers are indifferent among products, they can easily shift from one brand to another.
2. Kodak's objective should be to regain the market share of 76% and aim to maintain it for future. Kodak should penetrate into the market more, increase its product variance. (Brand-based differentiation) It should target professionals and serious amateurs. While lowering the gross profit margin Kodak should increase the dealers' margin, give incentives to dealers. Main portion of films are distributes through dept. stores, drug stores, etc. As shown in Exhibit-1, if Kodak increases the dealer's margin from 20% to 29%, the dealers will get the max profit among these brands...
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