GoPro’s Extreme…Competition

GoPro competes in the Point-of-View (POV) segment of the digital camera market. The digital camera industry has been facing a stagnant decline in recent years, with the proliferation of smartphones and their enhanced photo capabilities. In fact as smartphones have grown from >200M to over a 1 billion devices, digital cameras have floundered. Their saving grace, however, has come from the flimsiness of the phone, paving the way for demand in POV action cameras.

A report from IDC Group suggests that the global POV camera market is expected to grow from to $2.9 billion by 2018.

Eight million POV cameras were shipped worldwide in 2012, up almost 60% year on year. Furthermore the industry is expected to grow to 2.6 million cameras by 2016, representing a CAGR (2012–18) of 9.6%.

But competition is getting fierce. In Q3–14, GoPro had a 57% share of worldwide sales, while other major manufacturers were fighting for scraps: iON Cameras (12%), Sony (7%), Others (32%).

GoPro has demonstrated considerable success being the market maker, having gone public via IPO in 2014. However, through proving the market potential for this niche segment, GoPro has inadvertently spawned a wealth of “me-too”s: 35+ action camera manufacturers, some small and other major, trying to differentiate against one another. Lower price, marginal differentiation, and marketing/branding wars — all signs of the segment’s maturity.

The only thing that could disrupt this, is what killed the traditional digital camera industry in 2009 — the smartphone, an industry that’s also fighting to differentiate itself. Don’t say I didn’t call it!