With the pinch being so keenly felt, it continues to be rather surprising that there has been so little consolidation in the writing instruments market, especially in the US where Newell has a strong hold. The reason for this apparent lack of rationalisation in the marketplace could be attributed to any number of factors, such as old traditional companies not wanting to sell off their heritage or the merger and acquisition stars just not aligning properly.
Wrong timing
Jill O’Neill, Senior Category Product Manager for writing instruments at United Stationers certainly sees it as the circumstances just not being quite right – yet.
She says: “As a participant and observer in the market, it appears that the right set of motivations have not been present to drive consolidation. As demand continues to decline over time, the sense of urgency may increase for manufacturers to rationalise brands and capacity, as has happened in other product categories. Also, many of the writing instrument vendors have parent companies with headquarters in other countries and do well overseas.”
Certainly the overseas market and particularly Asia seems to be more robust for writing instruments, with Indian manufacturer Luxor Group one company that has enjoyed a solid 12 months despite issues with currency fluctuations.
Executive Director Pooja Jain explains: “The last year has been positive for the company in terms of volume and value growth, although overall the currency fluctuation with the dollar getting stronger against the rupee effected the cost of production to some extent. Nevertheless, exporting to international markets and growth opportunities covered our import values well.”
Interestingly, the M&A activity in India has also been more pronounced, most notably with BIC’s protracted acquisition of Cello.
One issue affecting many OP categories, regardless of geography, is digitisation. The key issue here for writing instruments is the sheer momentum of technological progress. Touch screen tablets have only exacerbated the move away from writing instruments that began with the proliferation of the home computer, laptops and notebooks.
If you want to see just how serious this migration is, take a look inside any school where pure handwriting classes have dwindled and may even become a thing of the past over time.
O’Neill says: “Classroom usage is, of course, a large portion of the writing instrument market. Educational science will play a big role in understanding learning styles and what methods generate the best long-term results. We continue to see people writing less in general with a pen or pencil, but when they do write, they will want something of quality and value. This may not apply to schools today, but it is definitely present in the workplace overall and could spill over into school use over time.”
Digital/traditional co-existence
Right now, there is still a desire for digital and traditional writing instruments to co-exist in schools and in workplaces, but are vendors embracing this movement enough?
BIC is certainly one company that has grabbed the scenario and opportunity with both hands with its BIC Education solution for primary schools that combines handwriting and digital technology.
The solution is equipped with digital tablets and educational software, designed with the collaboration of teachers, that makes it simple for teachers to create and share educational materials with students on tablets in real time.
Not surprisingly, in its promotional material the company is still keen to point out that “according to many experts, handwriting contributes to the structuring of thought and must remain a fundamental skill that children enjoy mastering”.
Billy Salha, Director of BIC Europe, adds: “For more than 60 years, BIC has assisted pupils around the world as they learn to write by trying to make simple and reliable products available to them. It is this philosophy that has guided our group in the development of the BIC Education solution to effectively support teachers and pupils through the transition to an increasingly digitised environment.”
Transition
Pentel has also embraced the digital potential with its popular Airpen design, which it continues to refine and accessorise.
Time will tell if this hand-in-hand approach with digital and traditional is the future or just the vessel from which we all migrate over to pure digital writing.
In the meantime, manufacturers are looking at innovation in all areas of their expertise.
United’s O’Neill explains: “We are watching end-user behaviour trends to see how much the digital and hard-copy worlds intersect. Writing instruments that incorporate styluses have been around for many years, back to when PDAs started to emerge as a work essential. We would expect continued development of new tools to help people increase their productivity and get the most out of their new digital devices and processes. “For writing instruments, some products have emerged that reflect the intersection of the hard-copy and digital worlds, but it is a little too early to tell how widely those will be adopted.”
There continues to be a trend towards more style and function-based selection over strictly cost in writing instruments. Recent innovation is focused on the inks and delivery systems to complement the barrel design and colour work going on to improve the overall writing experience.
As work and purchasing become more democratic, choices reflect personal preferences more than fiscal decisions.
O’Neill adds: “The innovation that drives a positive writing experience coupled with the ability to project style and professionalism seems to be paying off.”
Again in India, there is something of a bucking of the trend as witnessed by Luxor, with traditional writing instruments still proving to be good value.
Jain explains: “At Luxor we are seriously looking at a digital offering and evaluating the time for entry. However, while we believe there is a growth opportunity here, it will not be as significant as it still is in the traditional writing instruments area where we see continued growth at an average of 10%.”
In terms of product offering in the category, we seem to be in something of a mid-game scenario between the old and the new. As stated previously, whether this is a case of hedging bets, gradual migration or a belief that traditional and digital writing instruments can co-exist remains to be seen.
