Enterprise
Expanding imaging solutions market
Najihah S 
Koh says that Canon Malaysia would like to increase its SME clientele from 19% to 30%
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FOR many photography enthusiasts, Canon is a brand well known for its cameras and lenses. Canon is also well known among consumers for its inkjet and laser printers. Interestingly, in Malaysia, Canon’s inkjet and laser printers appear to be more popular than its cameras.

However, Canon’s business focus may soon change. Canon Marketing (Malaysia) Sdn Bhd CEO Andrew Koh wants to capitalise on changing consumer sentiments and extend the current market position of its imaging solutions division, which includes its cameras. 

 

Mirrorless cameras

This year, the company is banking on its mirrorless cameras, which is fast becoming a hit with younger group of photography enthusiasts. “Camera buyers are much younger now as the cost has gone down. People are gravitating towards mirrorless cameras due to its light weight and interesting features,” explains Koh.

“We have three major product groups that contribute to the company’s revenue. These are the office, imaging systems and copier products group. We are the leading brand for inkjet and laser jet printers,” Koh tells FocusM, explaining that its total sales for all product groups last year was about RM680 mil. Despite the stiff competition, Koh is confident that Canon Marketing will be able to hit its target of achieving 5% total revenue growth this year.

Canon Marketing’s office segment includes its inkjet and laser printers which contributes about 43% of its revenue contribution. Meanwhile, its imaging system (cameras) and copiers contributes 26% and 24% of its revenue respectively.

Last year, Canon Malaysia launched 12 cameras, including digital single-lens reflex (DSLR) cameras, selling over 30,000 units since then. Canon Marketing also launched compact cameras, six camera lenses, and 12 printer models and several security cameras.

Canon sells its products both online and also directly via retail stores. “Our revenue is mainly contributed by the retail side (compared to online sales). We have very strong channels and we have retail partners that have been with us for many years,” says Koh.

 

Stiff competition

At present, about 19% of Canon’s clients are small and medium enterprises (SMEs). The company wants to grow its SME segment to achieve a 30% SME client target in the near future.

Although the company is pushing for growth in the imaging product group, increasingly stiff competition on this segment is a major challenge. Camera sales are declining. “For cameras, we are seeing a dip in the sales. We are in stiff competition between other brands as well smart phones,” Koh says.

But Canon Marketing foresees a change coming soon among consumers, with growth in several business segments. Just a year ago, demand for consumer cameras and printers shrank or remained flat.

Canon marketing says it is determined to grow the various business segments using its five-phase Global Corporation Plan which was implemented in 1996. Under the plan, from 2016 to 2020, Canon has been implementing the fifth phase, which includes the establishment of a new production system to achieve cost-of-sales ratio of 45%. The company will also reinforce and expand new businesses while creating future businesses.

 

Video surveillance market

As part of its expansion plan, Canon is seeking to grow its surveillance camera section in the SME segment. In 2015, Canon acquired Swedish video surveillance firm AXIS for US$2.8 bil (RM11.62 bil). The company is now a leader in the video surveillance market. The popularity of Canon’s network cameras and medical devices pushed Canon’s third-quarter operating profit last year to more than double to ¥80.5 bil (RM2.97 bil).

Although Canon has been in the medical devices business for over 40 years, it has not fully capitalised on the potential of the market segment in Malaysia. “We are going into the healthcare segment since everything relates to digital imaging, meaning medical diagnosis imaging system (X-ray), photoacoustic tomography and 3-D measurements,” Koh explains.

 

Canon’s 80th anniversary 

It’s not easy to keep a company afloat under the current global economic environment. As Canon is celebrating its 80th anniversary this year, it is banking on its innovation to grow further. To-date, Canon boasts over 3,000 technology patents in the United States alone.

To celebrate the anniversary, Canon Malaysia has moved to its new headquarters in Shah Alam, Selangor where its administration, marketing, product servicing and gallery are located. Last year, Canon’s Asia-Pacific market contributed a net income of US$ 1 bil to its global profit from a net sales of over US$7 bil.  

Canon began operations in Malaysia in 1988. To-date it employs about 3,000 employees under several subsidiaries such as Canon Marketing, Canon Manufacturing (Malaysia) Sdn Bhd, Canon Machinery Sdn Bhd as well as Canon Opto (Malaysia) Sdn Bhd. Canon Opto is located in Shah Alam, Selangor with a land area of 131,600 square metres and paid-up capital of RM113.4 mil.

To Koh, training and development of Canon employees is an integral part of the organisation. “We are only as good as the talent that we have. We offer competitive packages, but we also conduct training that will sharpen their skills,” Koh says, who joined Canon in 1997.

According to Koh, the key to the company’s ongoing innovation is its commitment towards research and development (R&D). “We invest up to 8% of our total revenue on R&D,” he says.

Canon ambassador programme

REALISING that a promotional strategy is an important factor to growth, Canon Marketing (Malaysia) Sdn Bhd has launched its brand ambassador programme called ‘EOS Youth Ambassador Programme’ for the first time, where it showcases a new generation of photographers aged between 18-30.

Last year, Canon Malaysia launched 12 cameras, including digital (DSLR) cameras, selling over 30,000 units since then

Under the programme, from Oct 10 to Nov 11, Canon has been accepting submissions of photo shots from photography enthusiasts. The contestants are also required to prepare a short video about themselves using a Canon camera.

Winning contestants get an opportunity to participate in Canon professional photography workshops, train and be apprenticed under Canon Malaysia’s EOS Ambassadors. They will also receive other perks such as participating in Canon’s photography events and campaigns.

As consumers evolve and sophistication increases, Koh does not want to take the changing consumer tastes for granted.

He adds, “As they are more exposed to better image qualities shared on social media, consumers have also started looking for better alternatives and image qualities which can be captured by cameras. There are also savvy photo hobbyists who are looking to improve their photography skills. We aim to reach out to this group to help them hone their interest and skills.”



This article first appeared in Focus Malaysia Issue 260.