Luxor Writing Instruments Private Limited - Marketing Pens in India Case Study | Free Case Studies Page 1 of 1

Luxor Writing Instruments Private Limited - Marketing Pens in India

"The mass -consumed pens are high impulse, low budget products and thus visibility is most important.
Besides, there is no brand loyalty for the bottom segment."

- Supratik Sengupta, Product Manager, Linc Pens and Plastics Limited 1

Introduction
In 2002, Luxor Writing Instruments Private Limited (LWIPL) had emerged as the market leader in the
premium pens 2 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 Rubbermaid3 . 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.
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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.

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Introduction Contd...
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.

Background Note
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

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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
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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 Jain 5 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.

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Background Note Contd...

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

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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 Pens 6, Gel
Pens7 , Roller Pens8 and Marker Pens9 . 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
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