The Loyalty Loop
The Kodak Story: When Loyalty Becomes Dependency
5-6 minute read
TLDR version: Kodak dominated photography for decades by owning the emotional ritual of capturing and printing memories, but mistook habitual buying for true loyalty. Despite inventing the digital camera in 1975, the company protected its film business instead of adapting to changing customer expectations for immediacy and digital sharing. As competitors embraced the shift, Kodak clung to its old model, and by the early 2000s the decline was irreversible.
Their downfall wasn’t just technological, it was a failure to evolve with their customers.
Those Kodak Moments
Like many people born before the year 2000, I still remember having a camera with film. If you spoke to someone born in the last 25 years, the concept of having a camera in which you couldn’t see your pictures instantly is simply unthinkable, let alone having to go to a store, leave a film, and come back several days later to get the results.
Back then, Kodak was the fixture. Everyone wanted a Kodak camera, and the film was of the highest quality. But it wasn’t just a brand, it was an emotional fixture in people’s lives and the constant reminder walking into every printing store to get your film developed.
Capture memories
Print and share forever
Their slogan, “Kodak moments,” wasn’t merely advertising; it was cultural shorthand for memory, sentiment, and family history. Kodak built its empire by deeply understanding and embedding itself into the emotional side of photography. Cameras were affordable, film was consumable, and printing was a ritual. Every birthday, graduation, first day of school, and wedding passed through Kodak’s hands. They didn’t just sell films. They sold memories.
Kodak's Mistake: Dominance vs. Permanence
But like many category defining companies, Kodak mistook dominance for permanence. While they continued to market to new photographers and capture new generations, their relationship with existing customers began to stagnate. Their loyalty strategy revolved around habit and the assumption that once someone bought Kodak film, they would continue buying it forever.
On the surface, it looked like loyalty (high LTV & repeat purchases). In reality, it was a dependency. Granted, Kodak had rivals at the time such as Fujifilm, Canon and Sony, but if you went into almost any camera shop to get your prints developed, Kodak was plastered all over the walls and the recommended choice.
Kodak's Missed Opportunity
Ironically, Kodak invented the digital camera in 1975. Rather than viewing this breakthrough as the future of customer experience, leadership treated it as a threat to existing profit centers and shelved the product. They assumed their customers would never leave the familiar world of film, and it would also eat into their well established business of film, paper and processing. What Kodak struggled to realise was that Customers weren't loyal to film, they were loyal to preserving memories in the simplest way possible.
Kodak never asked how customer needs were changing, because the answer for decades had been the same: capture, develop, print. The company's loyalty loop wasn't intentional, it was circumstantial and habitually forced.
The 2001 Customer Shift: Instant Gratification
Just past the turn of the century in 2001, as digital photography matured, customers began shifting their behaviour. They no longer wanted a delayed emotional payoff, they wanted their images immediately and freedom to chose which pictures became immortalized and more special through print. Instead of asking: 'How can we help people capture memories more meaningfully?' Kodak clung to: 'How do we keep them buying film?' Customers who had trusted Kodak for generations watched the world move forward without Kodak moving with them.
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Delayed Gratification
Film photography required processing and waiting to see results.
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Instant Gratification
Digital photography offered immediate viewing and selection of images.
The Shifting Landscape
Companies like Canon, Sony, and eventually Apple stepped in, not by offering better film, but by understanding changing customer expectations. The loyalty loop shifted from ownership to instant access, from printing to sharing, from a physical archive to an on-demand digital one. Kodak, tied to its legacy business, missed the emotional shift entirely. Their customers weren't abandoning photography, they were evolving it and shooting more than ever before.
Loyalty didn't disappear. It migrated to better suit their needs.
Kodak's Final Chapter: A Failure to Evolve
By the time Kodak attempted a pivot, it was no longer the leader and a new generation of photographers would barely know their name. The brand that once shaped customer behaviour was now trying to catch up to it. After 120 years of capturing memories, Kodak filed for bankruptcy in 2012 with over 6 Billion dollars in debt. This wasn't because customers no longer wanted to take photos, but because Kodak failed to evolve with the way customers wanted to experience photography.
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1975: Digital Camera Invented
Kodak engineers create the first digital camera, but the innovation is shelved.
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Early 2000s: Market Shift Ignored
Digital photography matures, customer behavior changes; Kodak fails to adapt.
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2012: Bankruptcy Declared
After 120 years, Kodak files for Chapter 11, unable to keep pace with evolving customer needs.
The Real Lesson from Kodak: Customer Failure
Kodak’s story is often framed as a technological failure, but the deeper truth is this. It was a customer failure.
They didn’t lose because they ignored the digital camera. They lost because they ignored their customers' changing needs, behaviours, and expectations. Loyalty is not a relic; it’s a relationship, and those relationships evolve and change over time. Kodak assumed customers would stay because they always had.
In reality, customers stayed only as long as Kodak helped them create meaning. The moment someone else did that better, loyalty shifted and an empire collapsed.
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