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Deepak Jalan

Managing Director | 02 Mar 2010

In an industry characterised by a low level of differentiation, it is imperative that the major players strive to create perceptual brand differentiation among the potential target group. To create a higher involvement among the consumers while purchasing a pen, it is essential for pen companies to advertise the PODs (USP) of the product and the brand overall.

Deepak Jalan brings a vast professional experience of over 20 years in the writing instrument industry. As MD of Linc Pen, he heads a company publicly listed on the BSE and CSE. Under Jalan’s leadership, Linc Pen has grown from strength to strength and is today amongst the top five brands in the writing instrument space in the country. Linc boasts of having a track record of paying consistent dividends since the company went public in 1995. In fact, Jalan has consistently contributed to the growth of the organised sector in the writing instrument industry as an Associate Member of Merchant Chamber of Commerce, Member of the Writing Instrument Manufacturer’s Organization and as a Member of the Calcutta Pen Manufacturers and Dealers Association. He is also a Member of the Bharat Chamber of Commerce, among other noteworthy social clubs.

Jalan has also steered the course of Linc to several glories, including the CNBC Emerging India Award in 2005, recognised export house owing to an export turnover of more than Rs 20 crore in 2005-06 and Award for the Best New entrepreneur in Eastern India for 2005-06 by Bharat Chamber of Commerce. He firmly believes in business houses being responsible corporate citizens and contributing towards the betterment of the society as a whole.

In conversation with exchange4media’s Pallavi Goorha Kashyup, Jalan shares the growth of Linc Pen in India and the scope of the writing instrument market in the country today.

Q. In such a vast market, what is your key differentiator?

Over the last few years, Linc has developed an enviable brand image, wherein customers associate the product offerings (Linc pens) with clear and uninterrupted writing flow and classy looks. In an industry where product differentiation is minimal, Linc Pens can be easily identified owing to the superior look of the pen and the smooth writing flow. Of late, Linc has made a conscious effort to complement the look of the pen by enhancing the packaging.

Q. What do you think is the size of the pen market in India?

The writing instrument industry in India is highly fragmented. The total market is valued at about Rs 2,000 crore, and of this around 75 per cent lies in the organised sector. Linc today is the second largest player with a national share of about 10 per cent.

Q. Does star like Shah Rukh Khan’s universal appeal helped in effectively communicating your brand message to a wider target audience?

Shah Rukh Khan’s universal appeal has definitely worked for our brand. When we signed on Shah Rukh Khan as our brand ambassador, we were convinced that SRK’s core fans would match up to our core target consumer – the student and youth community. The decision to rope in SRK may have been taken on an impulse, but it worked for us. Though the marketing budget of the company shot up to Rs 8 crore, we have never had to regret it. The return on investment on SRK-related brand activity has completely overshot our expectations.

Q. What’s your target for 2010?

The sales turnover and the net profit for the first nine months of the current fiscal were Rs 162 crore and Rs 6.86 crore, respectively, as against Rs 139 crore and Rs 3.16 crore for the same period in the last year. We are looking at similar or better growth in both topline and bottomline for the remaining period of the current fiscal as well as in the next fiscal year.

Q. With the market flooded with Chinese brands, how do you plan to combat this threat?

Linc has over the years developed a brand perception of delivering qualitatively superior products specifically catering to the student segment at a highly affordable price. We do not intend to compromise on the quality of the writing experience delivered by engaging in the meaningless price wars (by reacting to the low priced Chinese brands, which have flooded the market today).

The Indian consumer today is extremely value conscious and is willing to pay a premium for a superior quality, which we have been consistently delivering in the past. Hence, we do not regard the Chinese brands in the mass pen market/ segment as a huge threat for now.

Q. How are you strengthening your base in the children’s segment?

We have positioned ourselves as a company specifically catering to the dynamic requirements of students (both school and college), and consequently have been involved in many school and college level activities aimed at enhancing brand awareness and inducing trials. Simultaneously, we have been conducting a market research to provide us with a psychographic insight of our core target group, which would enable us to come up with products more attuned with the target group taste and preferences.

Q. Why do you feel pens as a category is advertising so much?

In an industry characterised by a low level of differentiation, it is imperative that the major players strive to create perceptual brand differentiation among the potential target group. To create a higher involvement among the consumers while purchasing a pen, it is essential for pen companies to advertise the PODs (USP) of the product and the brand overall.

Q. What is the extent of your marketing activity?

Geographically, we strive to focus on our strong markets (primarily in the Eastern and Northern Zones) as we have an established distribution network in the East.

Q. Do you rely heavily on below-the-line support? Please tell us about some of your BTL campaigns.

BTL activities form the crux of our entire marketing campaign because it is more cost effective and more importantly, it provides us with a more concrete platform to design customised engagement activities catering to the TG demographics (geography, age group, etc). BTL activities also provide an opportunity to interact with the trade as well as the end users and acquire a valuable insight about their perception about our products and the Linc brand overall.

a) School activities – Spellinc is an inter-school spelling competition across 150 schools for the last 11 years. It has also been taken to other metros like Delhi, Mumbai, Chennai and Bangalore. Writing-fighting it is a handwriting competition held in schools;

b) We participate in local trade shows/ stationery fairs, mega trade fairs not only in Kolkata, but also in other leading cities like Mumbai, Delhi and Jaipur.

Q. How has PR helped in building the image of your brand?

PR activities and exercises have been an integral part of our marketing campaign and have played an important role in developing the Linc brand affinity and communicating to the media what Linc stands for.

We have been associated with the PR agency Hanmer for the last two years and have effectively utilised the platform to generate awareness about the various initiatives undertaken by Linc.

Q. What is your strategy for competing against the established ‘Add Gel’?

As we understand, Add Gel today has removed itself from the highly competitive mass segment (Rs 5-10) and has graduated to solely focusing on the mass premium segment (Rs 25 and above), whereas, we are primarily concentrating in the highly dynamic mass ball pen and gel pen segment.

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