Forecasting Total Market Demand

Action Camera Market

Adventure tourism is among the most growing activities in the world today. The growth is as a result of more disposable income, use on leisure, and need for a more healthy and active lifestyle. As a consequence, the demand for action cameras has increased in the camera industry so that users can capture their memorable moments in a quality and high definition way. Action cameras are in most cases linked to outdoor sports activities and extreme sports. They are also used in different areas such as studying wildlife and production in television. In 2014, the market for action camera was estimated to be $3.2 billion (Seitz, 2015). Personal use of action cameras in 2015 was approximately 86 percent while that of professional purposes was 14 percent (Seitz, 2015). In 2018, the global market share for action cameras was approximately $3.3 billion.

Global market for action cameras is characterized by many players. Majority of the dominant players in the market use new product development as a major strategy in the industry. As a result of increased growth potential, a number of players in the industry are now offering cloud storage in order to capitalize on the existing opportunities in the industry (Seitz, 2015). The main players in the industry are among others GoPro Inc., Nikon, and Sony. The competition in the action camera industry is high and in order to remain competitive and increase demand, players in the industry are effectively developing products that cost consumers less (Seitz, 2015). According to the law of demand, a reduction in price on the vertical axis leads to increase in the volume of product demanded on the horizontal axis (Tucker, 2019).

In addition, sales channels such as online and retail are effective in the industry hence used by the key players in the industry. The potential end users of action cameras are extreme sports enthusiasts, athletes, travelers, media companies, movie makers, and young people (millenials). Advancements in smartphones’ cameras could have an effect on demand of the product. The smartphone industry has made major advancements in devices’ cameras in order to meet consumer needs of quality and satisfaction. However, adding more value such as cloud based storage among other technological advancements on action cameras has maintained and increased the product’s demand.

Market Segments

Market segmentation was done based on common characteristics of the potential clients. Market segments comprise of clients who respond in the same way to marketing techniques and share common characteristics such as interests and requirements (Tucker, 2019). 

Analysis of Market Potential

The increasing demand in the industry allows a substantial investment. Increasing market size of action camera over the years is an indicator of potential growth in the industry. In 2018 for example, the market size for action camera was around $3.3 billion and it is forecasted that by 2023, the revenue in the market is expected to achieve a CAGR of approximately 16.7% (Technavio, 2017). The increasing number of extreme sports holidaying culture, seasonal leagues, and events in music are among the main factors that are causing an increased demand for the product throughout the world. Additionally, action cameras are becoming popular in professional activities and recreational activities hence an increase in demand. Furthermore, technological advancements in client electronics field such as incorporation of AI technology in cameras is facilitating growth in the industry. It is anticipated that by 2021, the industry will grow with a CAGR of fifteen percent (Technavio, 2017). In addition, features such as the cameras’ portability and being versatile are increasing the product’s market share. Other features such as add-ons that enable Wi-Fi among many other functions that enable connection with other devices appeal to consumers hence make them popular throughout the globe.

The market segments with the greatest opportunities are sports and recreation. Recreation activities is the fastest growing market segment in action camera industry. Recreation activities such as scuba diving for example have started taking a professional direction and are drivers for action cameras demand. Approximately one million certifications for scuba diving are given every year. Growth in such recreation activities will lead to increased demand action cameras. Interest in adventure and fitness has increased especially among young people in developed countries presents a high number of opportunities. Popularity of extreme/action sports over the years. Every year, there are more than 300 extreme sports events throughout the globe. Skateboarding for example has more than 12 million participants in the United States alone ( Action Sports ). Snowboarding has attracted approximately 2.5 million individuals. These figures provide insights into the rise of extreme/action sports hence potential market for action camera.

References

Action Sports. (n.d). The Action Sports Market: Active Network Rewards. http://www.activenetworkrewards.com/Assets/AMG 2009/Action Sports.pdf 

Seitz, P. (2015). Action Camera Market to See Growth through 2019. Investor's Business Daily Technology. https://www.investors.com/news/technology/gopro- tobenefit-from-action-camera-market-growth-futuresource/ 

Technavio. (2017). Global Action Camera Market 2017-2021. https://new.technavio.com/report/global-actioncameramarket?utm_source=t4&utm_medium=bw&utm_campaign=businesswire 

Tucker, I. B. (2019). Economics for today (10th ed.). Boston, MA: Cengage. ISBN: 978-1 –337613040