• Small and Light
  • Modest zoom lenses (still a big improvement on most smartphones)
  • Limited manual control
  • Often available in multiple color options
  • Many models offer built-in Wi-Fi
  • Faster, more versatile, and better in low light than a phone

The market for low-end compact cameras has taken a hammering in the past couple of years as smartphones replaced more basic compact cameras in a lot of people's pockets and handbags. 'Ultra-compact' cameras are typically marketed on the basis of their slim dimensions, attractive design and color options as well as more basic things like lens zoom and pixel count. As such, they make excellent first cameras for youngsters, and 'carry everywhere' options for social and everyday photography if you need more quality, versatility and responsiveness than a smartphone can offer.

Nikon's S02 compact (also shown above) is absolutely tiny, and in fact it only offers a smartphone-sized sensor and 3X optical zoom. Many cameras in this class, such as this Fujifilm FinePix Z1000EXR, use a touchscreen interface, rather than physical buttons. 

Touch-sensitive screens are starting to replace buttons and dials in this class (though smartphones are generally more responsive), and manual control is generally limited to exposure compensation. Don't expect to get amazing lens performance from this sort of camera either, but for social sharing and web use, you're covered. 

Of course, there are real advantages to most ultra-compact cameras compared to smartphones. Even a modest 3X zoom offers far more versatility than a phone (and with much better results than a digital zoom), allowing for  greater framing control, which leads to more flattering portraits or tightly cropped close-ups. A compact camera generally has less 'lag' when you take a photo, making it a lot easier to capture the exact moment you're aiming for.

You'll also better image quality in poor light, and a faster and more powerful flash. Naturally though, one thing these cameras can't do as well as a phone is sending your pictures to friends and social networks, and if this class of camera is to survive, that's something that probably has to change in the medium-term. As such, 'social' features are becoming more common in this class and we'd expect connectivity features to become standard very soon.