Can you remember the last time you had film developed? My guess is that it’s been a long time for most of you. Digital cameras, first introduced in the 1980s, have surpassed traditional film cameras in popularity. Kodak, once the dominant player in photography, failed to transition from analog to digital and went bankrupt in 2012.
Many people don’t buy digital cameras because their smartphones have built-in cameras. Documents and photos that were once physical are now being digitized and there’s no need to print these files when you can access anything from the cloud anywhere you are.
Sensing this trend, Fujifilm announced it would spend $4.5 billion on strategic acquisitions over the next three years in order to move beyond the traditional photographic business. Fujifilm has already begun acquiring in growing markets. Last year, the company announced it would expand its healthcare business by acquiring Wako Pure Chemical Industries from Takeda Pharmaceutical.
The healthcare industry is expected to grow as baby boomers age and people live longer with advances in science and healthcare. Rather than organically developing a new business, which takes time and expertise, through an acquisition, Fujifilm can immediately gain access to the growing healthcare sector.
This is a good example of how a company in a static or declining marketing can use acquisition to grow. Acquiring is faster than building your own solution internally and can help a company move from decline to growth.
Identifying Your Opportunities
If you are in a static or shrinking market, as a first step, evaluate your current business environment and your core capabilities. We often use a tool called the Adjacency Map to identify ways in which you can use your core competency to expand beyond your current business. Adjacencies can include new products or services, geographies, customers, channels, capabilities, forward integration and backward integration. For example, Fujifilm’s core competency is not film, but chemicals for photography and imaging, which are used in traditional photography as well as healthcare.
Try mapping out your company’s own opportunities and then select the ones that are in a high-demand market. Consider how external growth – including joint venture, strategic alliance, minority investment or acquisition – might help you reach a new market and reposition your company for long-term growth.