Canon 2004 Annual Report Download - page 50

48
reductions. With regard to marketing activities, in addition to
promoting marketing reforms through structural
reorganization and strengthening marketing channels, Canon
is also working to expand and strengthen its solutions business
and improve its hardware solutions offerings through greater
customization to better meet customer needs. Canon also
views the protection of the environment as an essential part of
its management activities and will continue to develop
environmentally-conscious products and introduce resource-
recycling systems while actively expanding its green
procurement and purchasing programs.
Business machines segment
Office imaging products
In the office imaging products segment, it has become more
important to provide added value in the form of networking,
integration, color printing, and high-speed models. Also, in
addition to the mid-level models for office market which
enjoys steady growth, Canon expects that the market will
expand into higher-end models and low-end multi-function
models. The market for color digital devices continued to
grow rapidly, and sales of monochrome digital multifunction
devices were stable, reflecting the market trend shifting from
single-function to multifunction.
To maintain and enhance a competitive edge and to meet
more sophisticated customer demands, Canon is strengthening
its marketing capabilities by reinforcing its hardware and
software product lineups and by improving functionality.
Canon strengthened the product lineups of its color digital
devices in addition to its existing full line of monochrome
machines and maintained its market share by executing
business strategies in line with the current market trend.
Manufacturing in the new Canon Suzhou facility in China
has been progressing satisfactorily. While competitors seek to
transfer manufacturing facilities to China, Canon regards its
manufacturing bases in Japan important as well, in order to
pursue total cost reduction by strengthening and reinforcing
of technology, through the collaboration of R&D division,
manufacturing division and quality management division.
Computer peripheral products
In the inkjet printer market, Canon expects a continuation of
declines in market prices, a shift from single-function printers
to multi-function printers, and an expanding size of the digital
photo market. To manage these trends, Canon has newly
established the PIXMA, brand name for its inkjet single-
function printers/multi-function printers worldwide (other
than Japan in which already introduced as PIXUS brand) with
new functions and technologies.
Canon’s laser beam printer business has a strong position
in the market. In the monochrome laser beam printer market,
Canon expects that the transition to a low price segment will
expand sales in the consumer market and in the emerging
markets. In the color laser beam printer market, Canon
expects continued strong growth in demand. In general,
competition will become more intense as competitors
implement aggressive price strategies in order to establish
themselves as market leaders. Canon seeks to remain
competitive by developing technologies that can be deployed
in a timely fashion to produce innovative products in all
segments. Canon is also working to lower costs by
automating production of consumables and to secure
procurement of essential parts through internal sourcing.
Canon expects that the size of the scanner market will
continue to contract, but Canon has increased its share in the
market with the new CanonScanLiDE series introduced in
fiscal 2003.
The size of the worldwide facsimile market has remained
stable, as expansion in Asia, mainly China, has offset declines
in other regions. Due to price declines for inkjet multi-function
printers with facsimile function, prices are also declining for
stand-alone machines.
Business information products
With regard to personal computers, demand from corporate
clients on the Japanese market held steady, but a decline in
sales was caused by our change in marketing strategy from
selling single products to a solutions business involving the
proposal of unique combinations of various products. This
trend is expected to continue in fiscal 2005.
Cameras segment
The entire digital camera market continues to expand.
Although in Japan and USA, it has started showing slow
growing curve, the emerging market, especially China and
Eastern Europe, have shown steep growth. In addition, the
emergence of new photo imaging systems, such as PC free
direct printing system, expands the digital imaging possibilities
through networking connectivity, along with the
improvement of the user-friendly image processing interface
and software.
Canon expects the market for compact digital cameras
will expand in the intermediate term. In general, declines in
prices and intense competition are causing decrease in
profitability in the industry.
The compact photo printer market is developing rapidly.
Canon expects that the ratio of Compact Photo printers that
is attached to digital cameras will reach around 30% within a
few years, and Canon will take an initiative to lead the
expansion of the market.
Canon played a major role in the rapid expansion of the
digital single lens reflex(SLR) market in fiscal 2004. The market
size almost tripled from fiscal 2003, easily taking over the
majority of the SLR market from the film cameras. With the
introduction of the new models, Canon is determined to stay
atop of the expanding market in fiscal 2005.
While industry enjoy many positive impact to motivate the
industry’s growth, as a nature of the Digital Consumer Goods,
the market will face with price competition as well as
technological competition focused on image quality and high