A Gartner Survey Shows that 12.7 million US Households are expected to have a digital camera by the end of 2000. "Ninety-eight percent of digital camera sales in 2000 will be to consumers buying their first digital camera, indicating the market is wide open to new vendors that have a better product and bigger advertising budget,'' said Andrew Johnson, vice president of Dataquest's e-Digital Imaging Devices and Services U.S. program. "New buyers most likely do not have enough personal, hands-on experiences with a particular digital camera model to have developed a strong preference. Word of mouth and third-party recommendations will weigh heavily in their purchase decision.''

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Gartner Survey Shows 12.7 Million U.S. Households To Have a Digital Camera by End of 2000

Survey of 40,000 Households Shows More Than Twice as Many Households Plan on Purchasing Digital Camera This Year

SAN JOSE, Calif.--(BUSINESS WIRE)--July 31, 2000-- One of the more popular consumer products this year will be digital cameras, as 12.7 million U.S. households plan on having a digital camera by the end of 2000, according to a new survey by Gartner Group, Inc. (NYSE: IT - news and ITB - news). Gartner surveyed 40,000 U.S. households in January 2000, and this survey revealed 5.4 million of the 103 million households in the United States currently have a digital camera. The rapid growth in the market will provide all digital camera vendors with an opportunity to succeed.

"Ninety-eight percent of digital camera sales in 2000 will be to consumers buying their first digital camera, indicating the market is wide open to new vendors that have a better product and bigger advertising budget,'' said Andrew Johnson, vice president of Dataquest's e-Digital Imaging Devices and Services U.S. program. "New buyers most likely do not have enough personal, hands-on experiences with a particular digital camera model to have developed a strong preference. Word of mouth and third-party recommendations will weigh heavily in their purchase decision.''

The Gartner survey found that 40 percent of digital camera households were in high-income households with annual incomes of more than $75,000. The study revealed that 60 percent of cameras were owned equally among less-than-$29,000 households, $30,000-to-$49,000 households and $50,000-to-$74,000 households.

Supply-side data shows that half of the 5.4 million households purchased their first digital camera last year. Digital camera prices last year were on average about $600, so most households with a digital camera will not rush out to purchase a new one again this year.

"Without an 'upgrade market' to tap into, incumbent vendors such as Sony, Kodak, Olympus and Nikon will not be able to directly leverage their loyal following into new sales this year,'' Mr. Johnson said. "Consumers planning to buy a new PC are also likely to purchase a new digital camera, so digital camera and PC vendors should co-market with in-store or in-box cross selling tactics that take advantage of this synergy.''

Additional findings from this survey are available in the Dataquest Perspective, "Who's Buying All Those Digital Cameras.'' The End-User Analysis uses the study data to profile current and future owners of digital cameras and suggests ways camera vendors can profit in this growing market.