The re-birth of the posh pen
The UK luxury writing instruments market declined by 3 per cent in volume terms and
2 per cent in value terms through 2012, with sales falling to £103 million. But there is a light at the top end
The UK luxury writing instruments industry is currently in decline due to the significant
shift towards paperless activities, according to new research from analysts CandMResearch. Electronic forms of communication are taking over consumers' lives and the need for luxury writing instruments is becoming more and more reserved for special occasions.
Meanwhile, things that used to be jotted down, such as grocery lists, personal reminders, etc, are now being typed into smart phones and iPhone's 'Note' apps. As well as convenience, paperless offers consumers less messiness and greater sustainability.
Of late, there has been a slight shift towards non-luxury writing instruments as many brands have expanded their ranges to include a more high-end style of writing instrument.
Non-grocery retailers remain the dominant retail channel for luxury writing instruments,
with an 81 per cent market value share in 2012. Non-store retailing is growing quite strongly, reaching a 19 per cent share in 2012. The internet channel is a significant growth market for luxury writing instruments, with a wide offering online, allowing consumers to find the best product with clear written descriptions.
Mont Blanc would be considered one of the most coveted luxury brands in the UK for luxury writing instruments. Mont Blanc has a long history and tradition within writing instruments and is considered by its peers, as having the world's finest collection of fountain pens and ballpoint pens.
But unit prices for luxury writing instruments are expected to decline year on year, as luxury brands continue to seek to encourage consumers into this niche segment of the luxury goods market. Key retailers such as Mont Blanc and Smythson, have had to branch into other markets such as fragrance, jewellery, watches and leather goods. More moderate pricing is a strategy moving forward for these retailers to help generate sales.
Luxury writing instruments are expected to perform more positively through to 2017 when compared with the past five years, as many industry experts claim the sector will make a 'comeback'.
Technology affects US stationery industry
Meanwhile, the US stationery market, which has demonstrated steady growth over the past five years, with value sales dipping only slightly in 2008, and increasing by 1 per cent through 2012, is increasingly being affected by technological advances such as email. Evironmental awareness has also thinned out orders and as a result, US revenue is expected to decline over the next five years.
Technological developments have been both friend and foe to this industry. On one hand,
computerisation of systems has improved operational efficiency for wholesalers and prompted development of computer-related office products; however, it has reduced the
overall need for office stationery and supplies.
Growing reliance on computers and other electronic equipment at homes and offices has decreased the amount of stationery consumed by Americans, reducing demand for industry products.
Stationery is being incorporated as part of the 'home' or lifestyle collections of a brand, alongside small items of furniture, bedding, towelling and other items that attempt to marry designer brands with home interiors.
Major fashion labels have incorporated branded stationery as another effort to expand their lifestyle presence. The growth of independently-owned stationery boutiques (particularly in affluent urban areas) and artisanal designs of stationery for holidays, party planning and other special occasions, has helped to revitalise interest in craft stationery.
High sales volumes and low profit margins have ever since characterised the market for
stationery products. Nevertheless there exist a few high-profit offerings, particularly in the writing instrument segments, such as fountain pens and luxury pens.
Seasons and cyclic trends still play a major role in determining the changing growth and
consumer buying patterns in the industry.
Special occasions and back-to-school seasons continue to keep retailers busy. Brand value does have a major impact, particularly with fashion conscious school children, with their leaning more towards high-end, premium, expensive and well-branded products.
Looking forward, weaker than expected growth for the US economy, perhaps engineered by contagion effects from the European debt crisis (home to the most prominent global luxury groups) could result in weaker growth for the US stationery industry over the coming years.
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