Luxor Writing Instruments Private Limited -

Marketing Pens in India:

Introduction
In 2002, Luxor Writing Instruments Private Limited (LWIPL) had emerged as the market
leader in the premium pens2 segment in India, with a market share of 60%. The company
held a 10% share in the writing instruments industry, next only to the market leader,
Reynolds that held 12%. LWIPL had been in the pen industry for nearly four decades. The
company adopted innovative marketing strategies that had made it one of the most
popular pen manufacturers in India.
LWIPL offered a widest range of pens with leading brands including Luxor, Pilot, Papermate
and Parker. In December 2002, LWIPL launched the world renowned 'Waterman' brand of
premium pens in India. This was possible after LWIPL's acquisition of a 50% stake in the
Indian operations of Newell Rubbermaid 3. The company planned to sell imported
'Waterman' pens for the next couple of years and then start indigenous production for
these pens. The price of these pens ranged between Rs.3,500 to Rs.50,000 and was made
available in nine sub-brands. LWIPL planned to sell these pens to corporate customers.

Commenting on the prospects of the 'Waterman' brand, DK Jain, Chairman of LWIPL said,
"Because of its price and brand name, Waterman will certainly have an edge over other
premium brands in India."4 The company planned to launch an international advertising
campaign for these pens. LWIPL was known for its heavy spending on advertising its
products. It had entered into several tie-ups with multinational pen companies that helped
in leveraging its current position in the industry.

The fact that LWIPL was a debt-free company was another significant achievement.
However, with the rising competition and negligible presence in the faster growing gel
pens segment, analysts felt that LWIPL had an uncertain future. Analysts also feared that
LWIPL's decision to diversify into the hospitality and packaged foods business in 2001-02,
might lead to a loss in market share in its core business. The pens industry in India had
passed through various phases with the changing tastes and preferences of customers.
Till the late 1970s, only two categories of pens existed in the Indian market - fountain and
ball point pens. During that time, people preferred writing through a pencil rather than a
pen. Moreover, people preferred fountain pens, as it was perceived to write better
compared to the ball point pens.

Apart from domestic manufacturers, who manufactured fountain pens on a small scale and
sold them at cheaper rates, branded fountain pens manufactured by leading international
players such as Monte Blanc, Cartier and Parker were available in India through the grey
market.

However, owing to their high prices, not many people could afford to buy them. Camlin
Limited was among the noted fountain pen makers in India during that time. By the late
1970s, fountain pens started loosing their popularity as people found it cumbersome to
refill the ink regularly.

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.

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 Jain5 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.

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 Pens6, Gel Pens7, Roller Pens8 and Marker Pens9. A marked change was also
noticed in the attitude of people, and they became increasingly brand conscious.

Marketing Activity
According to analysts, the major reason for LWIPL's success was its focus on offering
superior products to its customers. Luxor focuses a lot on marketing activities. Recently they
introduced an exclusive deal this summer with 'Summer Mega Offer Pack'. With a special assortment
of writing instruments from LWIPL's four popular brands - Parker, Pilot, Luxor and Papermate, this
pack aims to target the distributors and the customers through a unique offer. Priced at Rs 5115, it
provides the retailer greater value for money with an enhanced margin of 28% and a Yashica Camera
worth Rs 1305 free with the pack.

In addition, Luxor launched the "Jo Jita Vohi Sikander" Contest, a unique promotion for traders. They
would enjoy the benefits of the Club Parker membership wherein they would receive direct
communication from the company related to new products, exclusive signages, and discount coupons.
We also gave traders an opportunity to win exciting prizes like Samsung TV, Birla OTG, Moulinex Juicer
Mixer Grinder and VIP Strolley, if they achieved a certain sales target.

References: https://www.icmrindia.org/

https://www.exchange4media.com/brandspeak-news/

https://www.thecasecentre.org/