LUXOR WRITING INSTRUMENTS PRIVATE LIMITED - MARKETING PENS IN INDIA
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BACKGROUND NOTE
The 1980s witnessed an increased acceptance of ball point
pens and Wilson Jotter was considered to be the market leader in this segment.
The pens manufactured by Jotter were popularly called Jotter pens. The market
for ball point pens was also dominated by domestic players in the unorganized
market. With the increase in demand, existing players started expanding their
capacities while many new players began entering the market.
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In 1982, Deepak Jain, managing
director of Luxor Pen Company (Luxor) entered into an agreement
with the Pilot Corporation of Japan to officially launch Pilot pens in India. In
1984, Suraj Mal Jain[1] started a manufacturing unit for ball point pens and
refills in Kolkata and named it as Linc Writing Aids Private Limited. The company
launched new varieties such as disposable pens into the market. In 1986, the French pen company, Reynolds entered the
Indian market through its subsidiary, GM Pens International Limited by
setting up a manufacturing plant at Chennai. It used the latest technology
to make pens and refills of better quality and offered them at an
affordable price.
The Reynolds 045 pens became very popular among the
regular pen users; especially among the school and college students. Until
the late 1980s, not much importance was given to the promotion of pens and
there were very few recognized brands in the market. Companies did not
consider it worthwhile to invest large amounts of money on promotional
activities. The focus was more on pricing and distribution. Pens were
manufactured in large volumes, and were priced competitively. By 1990, 90%
of the market share in India was held by unorganized players. |
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In the late 1990s, the pen industry witnessed several
developments. The varieties of pens available in the market increased
significantly. The new range of pens introduced included Fibre Tip Pens[2] ,
Gel Pens[3] , Roller Pens[4] and Marker Pens[5] . A marked change was also
noticed in the attitude of people, and they became increasingly brand
conscious.
By early 2002, some of the most popular brands in the Indian pen market
comprised of domestic brands such as Reynolds, Luxor, Cello, Rotomac, Kores,
Today's, Montex and Add pens and foreign brands such as Mont Blanc, Flair (with
Pierre Cardin), Uniball and more. Consumers now had a wider choice, both in
terms of different variety and the number of brands available. Gradually, the
competition among different pen brands intensified, which in turn, prompted
these companies to increase their spending on promotional activities.
According to the 2001-2002 figures, the writing instruments industry in India
was worth approximately Rs.15 billion[6]. Studies[7] on the industry had
revealed that there were around fifteen organized players, which included both
domestic and international companies and more than 600 unorganized players.
Though, in the past, unorganized players accounted for a sizable share of the
industry, their share had decreased significantly from around 90% in 1990 to
just 20% in 2002. The huge potential that the industry offered prompted
existing companies to expand their manufacturing facilities and encouraged new
companies to enter the industry. This had led to intense competition in the
industry.
The studies also revealed that the companies in the organized sector were
putting efforts in offering good quality products at competitive prices. At the
same time, impetus was given to increase the visibility of their products in
the minds of target customers.
Established in 1963, Luxor had emerged as one of the leading companies in the
pen industry. According to analysts, Luxor's marketing mix helped it to capture
a sizeable share of the industry. They also felt that Luxor's 50-50 joint
venture with Gillette Company[8] in 1996 helped it to strengthen its position
in the industry. After entering into the joint venture, Luxor was renamed as
Luxor Writing Instruments Private Limited (LWIPL).
THE MARKETING MIX
THE FUTURE
ADDITIONAL
READINGS AND REFERENCES
[1] Suraj Mal Jain was the managing director of Linc Pens and Plastics Ltd. In 1976, he had set up a small manufacturing unit for ball point refills in Kolkata.
[2] In these pens, the ink is fed into the tip of the pen through a meshed fibrous reservoir which works on capillary action and the ink is then passed on to the ball which rolls on the paper. These pens later came to be known as Roller Ball Pens.
[3] The pens with refills filled with gel ink, a semi-solid fluid, and pointed tip, which enables smooth writing experience.
[4] A variety of fibre tip pens in which a regulator controls flow of ink thus eliminating the need for an absorbent wadding, and yielding more ink holding and writing capacity.
[5] A variety of fibre tip pens used for marking and highlighting.
[6] In an article titled "Charlie Parker's license to Quill," by Pramila N. Phatarphekar in Outlook dated March 4, 2002.
[7] In an article titled "Luxor takes FMCG route to market Papermate stationery products" dated September 2, 1999, by Kumar Kaushalam posted on www.indianexpress.com.
[8] Gillette is a US based company and is the world leader in shaving products. Its stationary products division had world famous brands such as Parker and Papermate. In 2000, Gillette sold its stationary products division to Newell Rubbermaid.
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