Thursday, January 12, 2006

Parker : Why use a pen that's not a Parker!

Brand: Parker
Company : Luxor Writing Instruments Ltd
Agency :Lowe
Indian writing instruments industry is worth around 1600 crores . Luxor is a major player in the market with a market share of around 15%.

Parker is a brand that is well established in this market. Parker is manufactured and marketed in India by Luxor Writing Instruments Ltd (LWIL). Parker was launched in India in 1996. Luxor had a joint venture with Gillette which owned the brand at that time. In 2000 Gillette sold the brands to $9 Billion major Newel Rubbermaid. That included the 50:50 joint venture with Luxor. Later the Jains bought the entire stake in the joint venture. Now LWIL have the 100 right to manufacture and market Parker Pens in India.

The writings instruments market can be classified into premium, middle and economy segment. There are many established players in this market like Reynolds, ADD Gel,Todays, Camlin etc.

While the premium segment is dominated by super expensive brands like Mont Blanc , Cartier etc, the economy segment is dominated by local players. All the action is in the middle segment which consists of College students, Executives Businessmen etc.
Parker pen was born in 1888 in Janeswille Wisconsin US. The pen was created by George Safford Parker who was a teacher of telegraphy. He started the business as a source of additional income.
The famous Arrow Clip that is the trademark of Parker was created by Joseph Platt in 1933.
Parker pens have a rich heritage. The treaty of peace ending the 1898 Spanish- American Civil war was inked using Parker pen. Sir Arthur Conan Doyle drafted the stories of Sherlock Holmes using Parket pen. The list contains the Who is Who of American History.

Parker was considered to be a premium brand in India ( before Mont Blanc and Co's landed with rs l lakh and above pens) . The brand had an aspirational value attached to it. Then LWIL decided to shed the premium image to play the volume game.
Earlier Parker was priced above Rs100. Research found that the price put off a large segment of the market. The market was dominated by Reynolds ( again a Rubbermaid brand) marketed by GM Pens. The TG for this segment was the school/ college kids and this segment was growing. Reynolds is leading with a market share of 12% and Luxor umbrella brands are next with 10% market share followed by players like Cello and Todays.

Parker then launched Parker Beta for Rs 50 aiming this segment and play the volume game.

Parker is endorsed by none other than Big B. Some ads are lousy and some very good. I like the ones with the baseline " Why use a pen that's not a Parker" .

Since the lower segments of the pen market lacks brand loyalty, BigB can make a difference . LWIL by using BigB aims to connect and identify with young and old alike.

There are other players like ADD Gel which carved a niche in this crowded market with their Gel pens. Now Gel pen market is worth around 350 crore.

Parker was a brand that had the elegant premium touch to it with its rich tradition and quality. But with the launch of lower priced Parker range, the premium and the exclusivity has been compromised . Now the Parker range is available from Rs 50- 5000. Big B to certain extent salvage the pride of Parker. But when the brand tries to play the volume game, it is difficult to sustain the premium. Thus Parker is losing out the Executive segment where pens are used as Accessory. Its is a void that is waiting for a brand.

As one of my colleague after buying a Parker Beta commented " Parker has become Cheap".