Lexar Media Inc.The Digital Photography Company?

17th Nov. 2011

Lexar Media Monica Fan

Denise Ahern

Victoria Sheehan

Sean O’ Leary

Eimear Clancy

Lexar Media : General Overview

John Reimer –President and CEO 1997

In 2001 branched in USB marketplace

Takeover in 2006- Micron

Market

Flash Card Market

1997 2000 20040

1

2

3

4

5

6

0.221

1.254

5.282

Sales Volume (billion)

Sales Volume (billion)

MarketParticular for Digital Photography Market

1999 2000 200505

10152025303540

11.615.1

38.7

Sales Volume (million)

Sales Volume (million)

Strategies Luring Market: Digital Photography Focus

Distribution Strategies

Original Being direct to Retailers

Equipment “Push” Strategy

Manufacturer

Relationships

Crossing the Chasm

Three Segments in the Market

Crossing the Chasm

Professionals

Average Camera Users

Reputation

3C Campaign Lexar-using Elite PhotographersA free data recovery service to customers

John Reimer CEO and President

1997- 2004

• Passionate about Photography

• Former VP of SanDisk, Lexar’s Main competitor

• Visionary

How Reimer successfully established

the Lexar brand

• Company focused solely on one market, digital photography

• Aimed it at the right market, professional photographers

Why were Lexar Media so successful?

Distribution Strategy:Two-tied strategy: sell to both camera manufacturers

and directly to retailers

Partnerships:Strategic partnerships with Sony, Samsung and

Olympus

Product:Proprietary technology made the digital film up to

three times faster than their competitors

SWOT Analysis

o Strengths:Differentiated product and market strategyStrategic relationshipsCards certified for “Digital Film

Compliance”

oWeaknesses:Too focused on photographyPurchase flash memory from external

providers

SWOT Analysis

Opportunities:Memory used via USB portCreate new relationships with other

camera brands

Threats:SanDisk is their major competitorRelationship with Sony could break down

Lexar: Developments Since 2001

2001: After missing Quarterly numbers, Printroom.com is sold to it’s original founders. Shoot & Share and SayCheese.com are discontinued.

2002: Lexar signals it’s diversification as a company by removing the words “digital film” from its packaging.

Lexar: Developments Since 2001

Lexar announces and ships it’s first USB Flash Drive.

2003: Lexar enters the MP3 market with it’s JumpDrive Music player.

Lexar: Developments Since 2001

2004: Lexar agreed a deal with Kodak that allows it to distribute flash cards branded with Kodak’s name.

Lexar also entered the gaming storage market.

Although revenues continued to grow strongly from 2003 – 2005, Lexar was still unprofitable and losses were increasing.

SanDisk, cash rich and profitable, was able to slaughter the competition as regards pricing.

Lexar was at a crossroads and needed a new strategy.

Lexar: Developments Since 2001

2006: Micron, one of the world’s leading semiconductor companies, acquired Lexar for $850M.

As Micron developed it’s own NAND, the biggest cost for card makers, Lexar was able to avail of significant savings.

Lexar had previously sourced flash memory from Samsung.

Now

Subsidiary of Micron Technology, Inc

Digital photo/video

Gaming  

Personal Storage

Mobile storage

Any Questions?