The Kodak Test: Is Your Print Business Following Customers or Defending Its Equipment?
The Kodak test for a print business is simple: when customer behavior changes, do you follow the customer’s job, or do you keep steering the customer toward whatever best feeds your existing equipment?
That question is more useful than the familiar story that Kodak invented a digital camera and then ignored digital photography. Kodak developed and commercialized digital technology over decades, including digital cameras, retail kiosks, digital printing systems and inkjet products. Its problem was not a complete absence of technology or activity. It was turning those efforts into a business capable of replacing what film had provided.
That distinction matters for print shops. Buying a digital press, adding wide-format capacity or launching an online storefront proves that a shop has invested. It does not prove that customers value the offer, that salespeople can sell it, that buyers will reorder it or that the resulting revenue can support the organization. Innovation, sales, profit, cash flow and strategic renewal are related, but they are not interchangeable.
What Kodak’s transition actually warns us about
Kodak’s legacy business set an unusually demanding benchmark. Film had attractive economics, deep customer familiarity and an established system around cameras, processing and prints. Digital imaging initially brought uncertainty about the technology, its applications, its users and the business models that could support it. Continuing film demand also made the old system appear more resilient while the new one developed. That is the central tension described in the Wharton Mack Institute study of Kodak’s strategic renewal.
Early digital demand was not obvious or frictionless. Cameras approaching film-like resolution were expensive, battery and power requirements created problems, and consumers needed additional devices, storage, software and printing processes to manage their photographs. The consumer digital-camera market did not take off until the late 1990s.
Kodak nevertheless achieved genuine digital milestones. Its consumer digital-camera division was profitable in the second half of 2003, and the company led the US digital-camera market in 2004 and 2005. Those achievements still did not make the broader transition sufficient.
The lesson is not that every legacy print product should be abandoned. It is that local success can conceal a larger commercial problem. A new service can win orders without becoming strategically meaningful. A legacy service can remain busy while losing relevance. A growing product line can still face price pressure or consume cash faster than expected.
Test 1: Start with the customer’s job, not the press
Equipment-led selling begins with a machine and searches for work to feed it. Customer-led selling begins with the outcome the buyer needs and then chooses the right production method.
A restaurant group may not want “more wide-format output.” It may want faster local menu changes across 18 locations. A manufacturer may not want “premium labels.” It may want shorter approval cycles and fewer obsolete labels when regulations or product specifications change. An event company may not want “a banner package.” It may want one dependable vendor to coordinate signs, badges, directional graphics and last-minute replacements.
Those are hypothetical examples, but they expose the difference. The equipment is part of the solution. It is not the customer’s reason for buying.
Run this test on your top 20 active accounts. For each one, write the recurring customer job in a sentence without naming a machine, substrate or print process. If the sentence is difficult to write, the account knowledge probably lives at the order level rather than the business level.
- Weak account description: “They buy 5,000 folded brochures every quarter.”
- Stronger account description: “They equip regional sales teams for quarterly product launches.”
- Weak account description: “They order roll labels.”
- Stronger account description: “They need approved packaging labels in manageable batches as products and claims change.”
The stronger description opens a sales conversation. It can reveal timing, approval, distribution, inventory and coordination problems that a product-first quote never reaches.
Test 2: Separate market signals from comforting activity
Shops often treat every order as evidence of demand. That is too generous. A one-time order obtained through a steep discount, personal favor or rush rescue does not carry the same information as a reordered program with multiple users and a predictable calendar.
Kodak’s professional DCS digital cameras were technologically significant, but the market was narrow. A published historical study reports that models costing roughly $20,000 to $25,000 sold 974 units from 1991 through 1994. That was evidence of a real application, not evidence of a mass consumer market.
A print shop should classify demand signals by strength. An inquiry is weaker than a paid pilot. A paid pilot is weaker than an unprompted reorder. One enthusiastic contact is weaker than adoption across several departments or locations.
| Signal | What it tells you | Commercial response |
|---|---|---|
| Inquiry or sample request | The problem may exist, but willingness to pay is unproven. | Confirm urgency, buying process and current alternative. |
| Paid first order | A buyer accepted the offer once. | Track use, satisfaction, support load and the next likely trigger. |
| Unprompted reorder | The product or service retained practical value. | Ask what caused the reorder and whether the pattern can be scheduled. |
| Expansion to another team or location | The offer may solve a repeatable organizational problem. | Document the rollout process and identify decision-makers. |
| Recurring program | Demand has become more predictable. | Protect service performance and look for adjacent customer jobs. |
Salespeople should record these stages in the CRM instead of lumping everything into “won revenue.” A simple print sales pipeline can distinguish discovery, quoting, commitment and account growth so management can see whether an experiment is moving toward repeat business.
Test 3: Look for the system around the product
A technically strong product can fail commercially when the surrounding system is missing. In Kodak’s copier effort, the company developed a high-quality product but did not build the national sales and service organization required to challenge Xerox effectively, according to the Wharton study.
Print businesses encounter smaller versions of the same problem. Adding packaging prototypes may require consultative discovery, structural design partners, color controls and a different approval process. Selling national retail graphics may require inventory visibility, location-level shipping data, installation coordination and issue resolution. The machine may be ready months before the sales and service system is ready.
Before calling a new capability a growth market, map the complete delivery system:
- Who identifies and qualifies the opportunity?
- What information must discovery capture before estimating?
- Who creates samples, prototypes or proofs?
- How will the buyer approve versions and changes?
- What training does the sales team need?
- What happens after delivery?
- What support, installation or replenishment does the customer expect?
- Which failure points could erase trust or prevent a reorder?
For broader context on custom print products, production and adjacent applications, Printiverse provides additional coverage; see details. The commercial question remains yours: which of those capabilities connects to a customer problem your team can repeatedly find, sell and serve?
Test 4: Measure replacement potential, not just growth percentages
A new line can post an impressive growth rate from a small base. That does not mean it can replace a declining core business.
Eastman Kodak reported 35% year-over-year growth in consumer-inkjet printer-unit shipments and 39% growth in consumer-inkjet revenue for 2011. The same filing reported price and product-mix pressure in consumer inkjet and digital capture. Eastman Kodak’s 2011 SEC filing therefore presents a more complicated picture than the growth figures alone.
The filing also reported intellectual-property licensing revenue of $64 million in 2011, compared with $838 million in 2010 and $435 million in 2009. Kodak’s 2010 filing reported $219 million of net cash used in operating activities. These are company-level figures, but they demonstrate why recognized revenue, growth and operating cash flow must remain distinct.
A print shop does not need to copy corporate financial reporting to learn from this. It does need a commercial scorecard that goes beyond sales growth.
- Qualified opportunities created for the new offer
- Quote-to-order conversion rate
- Average time from discovery to first order
- Reorder rate within the relevant buying cycle
- Revenue from existing accounts versus new accounts
- Number of contacts, departments or locations adopting the offer
- Sales and service effort required per order
- Revenue displaced from an older product rather than added to the account
- Cash tied up in samples, inventory, installation or extended payment terms
The relevant buying cycle matters. A customer who reorders event graphics annually should not be judged by a 60-day repeat window. A buyer with weekly label demand should not receive a year before the team investigates why the second order never arrived.
Test 5: Ask whether the customer’s substitute has changed
Your competitor is not always another print shop. It may be an email, a customer portal, an office printer, reusable signage, a blank package with a small applied label or the decision to eliminate the item entirely.
The Kodak case became harder when smartphones combined image capture, viewing, storage and sharing. The published historical interpretation is that this changed the demand system and reduced the appeal of standalone cameras and home photo printing. It does not prove that one product or one management decision caused Kodak’s outcome. It shows how a substitute can absorb several customer jobs at once.
During account reviews, ask what the customer would do if your current product disappeared. The answer identifies the real alternative. If the buyer says, “We would send a PDF,” then the sales task is not beating another brochure printer. It is proving where a physical piece improves the workflow or customer experience enough to deserve a budget.
Test 6: Run experiments that can change a decision
An experiment is useful only when management knows what it is trying to learn. “Let’s promote short-run packaging” is a campaign. “Can we win paid packaging pilots from five existing product companies, deliver them with the current team and earn two reorders within each buyer’s normal launch cycle?” is a commercial experiment.
Consider this clearly hypothetical example: a commercial shop believes its healthcare clients need small batches of updated patient materials. Instead of buying equipment immediately, it interviews ten account contacts, identifies the approval and obsolescence problem, sells three paid pilots through a qualified production partner and measures revision frequency, delivery requirements and reorder behavior. The test can reveal demand and workflow requirements before the shop commits major capital.
Set four elements before each experiment:
- A customer segment and specific job to be solved.
- A paid offer or pilot with clear boundaries.
- Evidence that would support expansion, revision or cancellation.
- A review date tied to the customer’s real buying cycle.
A practical Kodak test for your next sales meeting
Review one legacy offer, one growing offer and one proposed investment. Rate each as green, amber or red across the following questions. Green requires observed customer behavior, not internal enthusiasm.
| Diagnostic question | Green evidence | Warning sign |
|---|---|---|
| Can we state the customer job without naming our equipment? | Salespeople describe the buyer’s outcome and trigger. | The pitch begins with press specifications. |
| Is demand repeating? | Customers reorder within a logical cycle. | Most sales are isolated jobs or discounted trials. |
| Does the offer expand inside accounts? | More contacts, locations or applications adopt it. | One champion generates all activity. |
| Can our sales and service system support it? | Ownership, discovery, estimating and follow-up are defined. | The production capability exists, but selling and support are improvised. |
| Could it replace declining work at meaningful scale? | Pipeline and repeat revenue are material relative to the gap. | A high growth rate comes from a very small base. |
| Do we understand the customer’s substitute? | Discovery captures what buyers would do instead. | The team watches only direct print competitors. |
| Will the experiment change a decision? | Success and cancellation criteria are documented. | The test continues regardless of the result. |
Do not turn the colors into a decorative dashboard. Assign an owner and a next action to every amber or red item. If discovery is weak, schedule account interviews. If paid pilots convert but do not reorder, investigate delivery, use and follow-up. If the product works but the sales process stalls, tighten qualification and use a more disciplined approach to closing print sales.
Follow the demand without chasing every request
Customer-led does not mean saying yes to every custom request. A buyer can ask for work that fits neither the shop’s capabilities nor its desired accounts. Following customers means learning which jobs recur, which problems command a budget and which solutions can be delivered reliably enough to earn the next order.
Kodak’s history does not offer a formula that guarantees growth. The evidence describes multiple interacting pressures: legacy-business decline, uncertain demand, competitive pricing, investment requirements and cash constraints. Eastman Kodak and its US subsidiaries ultimately filed for Chapter 11 on January 19, 2012; restructuring plans included balancing digital investment against liquidity needs, leaving dedicated capture devices and exiting the remaining Kodak Gallery business.
The useful warning for a print business is narrower and more actionable. Technical capability is not customer demand. Initial sales are not repeat business. Growth is not automatically scale, and revenue is not automatically cash. Use the Kodak test before the next equipment purchase, product launch or account review: identify the customer job, verify the demand signal, build the surrounding sales system and measure whether the offer earns a durable place in the customer’s operation.
