At every photo and printing industry gathering, the topic of discussion is always areas of growth. It’s no secret there is too much capacity in the photo printing business, so photo labs and printers are looking for ways to increase volume, especially in non-peak times.
According to the latest consumer photo-merchandise tracker report by Futuresource Consulting, the Western European consumer photo-merchandise market has witnessed continued growth over the past two years, reaching €851 million retail value at the end of CY2015. This growth will continue in 2016 with a forecast increase of 8% to reach €920 million.
“Covering Austria, Benelux, Denmark, Finland, France, Germany, Italy, Norway, Sweden, Switzerland, Spain and the United Kingdom, the research highlights the year-on-year growth which is being fueled mainly by wall décor, consisting of posters and canvases, acrylic, aluminum-dibond and wood,” comments Jeremy Wills, senior market analyst, Futuresource Consulting. “Wall décor is the single largest category of photo-merchandise, accounting for 36 percent of 2015 revenues; forecast to increase its share of revenues marginally in CY2016.”
What is especially appealing about wall décor is this category is not subject to the extreme seasonality of cards and calendars, as we will soon see. Unfortunately, this category is also seeing a great deal of price pressure.
Futuresource Consulting expects the share of the wall décor market to increase a little through to CY2019, driven by sales volume more than price. Although the industry is promoting larger SKUs and new substrates, the average price for a canvas is continuing to fall due to major promotional activity directly by resellers and via Groupon and other discount aggregation websites.
Calendars, photo cards and photo gifts accounted for the rest of the photo-merchandise market in 2015, with 28%, 24% and 12% of sales respectively. Calendar prices rose a little during the year although a small reduction in average prices is expected in 2016. Futuresource expects prices will remain relatively static through to 2019. Calendars remain a seasonal product with more than 90% of sales occurring during Q4 and early Q1.
The average price for posters is rising, as this is a less competitive market, and volumes continue to decline year-on-year overall. Photo card average selling prices are also on the rise, again driven by a greater range of SKUs. Online ordering continued to be the dominant channel in 2015, representing 91% of orders with a value of €774 million.
Futuresource expects growth will come from ongoing industry promotion of new product SKUs and the offering of attractively priced products. Ordering via mobile device apps and HTML-5-based ordering will assist demand growth, according to Futuresource. The latter, in particular, could generate incremental sales volumes beyond our existing expectations but a market saturated with new app and mobile platform sellers could also create additional price pressure and erosion and commoditize some photo-merchandise products.
As one of the leading providers of mobile and HTML-5 photo merchandise-creation experiences, Mediaclip is prepared to enhance the offerings of online retailers with proven technology and UI excellence.