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Course Title Course Supervisor

Marketing Report The Case of Parker Pen Company

By:

April, 2009

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Table of Content 1.0 Introduction

1.1 Overview of the Parker Pen Company Case 1.2 Evaluation of the Marketing Situation of Parker Pen Company 1.3 Marketing Miscalculations made by the advocates of Globalization at Parker

Pen 1.3.1 Miscalculations of the Product Policy 1.3.2 Miscalculations of the Target Segment 1.3.3 Miscalculations of Competitors

1.4 Was the globalization strategy sound for writing instruments? 1.4.1 Should the merits of global marketing be judged by what happened

at Parker Pen Company? 2.0 Ten Minutes Key Point Presentation of the case.

2.1 Conclusion and Recommendation

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1.0Introduction Integrated Marketing Communication is a new approach through which a company draws

maximum benefits within a single setting. In other words, it is a new way to give users of

the marketing mix an opportunity to make use of all aspects of marketing communication

such as advertising, sales promotion, public relations, and direct marketing a strong force,

rather than permitting each to work in isolation (Kortler & Pelsmacher 2003). However,

Varey (2001) postulates that integrated marketing is a paradigm shift towards more

personalised, customer-oriented, technology-supported marketing systems.

Global marketing is marketing on a world wide scale reconciling or taking commercial

advantage of global operational differences and opportunities in order to arrive at

predefined organizational objectives while creating uniqueness. The current revolution of

information and communication technologies is changing our business environment

drastically: new technologies influence the way we organize our work and the

environment in which we compete, introducing new rules and new relative powers

among incumbents, newcomers and even entire markets. This complex, evolving

environments are referred to as new technology playgrounds

This paper focuses on the case of Parker Pen Company. The first part of the paper

provides an overview of the case and the nature of the marketing and communication

techniques used by the company, the second part of the paper focuses on some of the

miscalculations the company did, that cost them a fortune. The last part of the paper

provides the conclusion and recommendation.

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1.1Overview of the Parker Pen Company Case The case Parker Pen Company focuses on a key player in the writing industry. It main

activities include the manufacturing of writing instruments and are one of the world’s

best known companies in the domain. As a global company, its products are sold in 154

countries and the company considered itself number one in 'quality writing instruments'.

Things didn’t work out and remain the way the company had thought and plan as its

global marketing and communicating strategies designed and planed at the headquarters

cost the company a fortune. The company failed and made huge marketing and product

positioning mistakes, they neglected local values and cultures and in all management

failed to recognize that, as other one size fit all brands like coca cola, Parker Pen

Company with its quality writing instruments cannot be matched and placed in the same

domain.

Huge other errors and calculations were made and to make matter worst, practitioners and

pioneer of the Parker Pen global marketing concepts were fired. A company that was

once used as benchmarking models a super hero, and a world class in quality writing

instrument became a laughing stock. In global marketing, if cultural and competitive

differences are less important than their similarities, a single advertising approach can

exploit these similarities to stimulate sales everywhere, and at far lower cost than if

campaigns were developed for each. However, the situation of Parker Pen proofs the

contrary. The company’s marketing department would have acted with respect to

different market, for the issue of standardization, one sound, one size as in the situation of

coca cola couldn’t be replicated for Parker Pen Company.

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1.2Evaluation of the Marketing Situation of Parker Pen Company Coca-Cola uses its familiar red and white logos and retains themes of togetherness,

fashion joy and enjoyment throughout its marketing communications. The same

uniformity is maintained and followed by Fanta, Microsoft, Nike, Sony and host of other

companies. What should be the rational behind this? Is it for fun? Integrated marketing

communications see the elements of the communications mix 'integrated' into a coherent

whole.

As the fight of market shares and quest for product success continue, marketers are

employing all the necessary tactics, and methods to give their product a break through, or

remain competitive (Brennan, Baines, and Garneau, 2003, Rowley J 2004). One way of

doing this is through differentiation, making your product outstanding, by having your

values and image (Zineldin M., and Philipson S., 2007). This is known as the marketing

communications mix, and forms the basis of marketing (Pelsmacher& Kitchen., 2005).

Parker Pen Company marketing campaign rested on a one world one market one style fit

all approach. The head office centrally planned for the marketing, communication and

advertisement on a one size fit all basis where as the product they offer to the market

couldn’t be standardize to meet up with global marketing. According to Kotabe & Helsen

(2005:4) today, in international business and with the proliferation of the Internet and e-

commerce, if a business is online, it becomes a global business. More and more people

are becoming internet users daily with the market growing constantly. According to

Kotabe & Helsen (2005) e-commerce is larger, growing faster, and has fewer

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geographical distribution obstacles. Parker Pen aught to have maintain but common

elements in its global marketing campaign. Items such as the product design and the

packaging could have been standardize, however, the marketing communication and

advertisement messages aught to have been tied down to local values and cultures. In

international business, management has to think globally and act locally. This was the

biggest miscalculation the marketing team made with its, push and pull marketing

campaign of everything having one voice and one look. The was nothing wrong with the

campaign, however the campaign was a misfit for the Parker Pen Company’s product

which was different from other companies like Coca Cola pursuing the same strategy.

The definition of marketing still applies in the same way in international markets as it is

in domestic market. However, culture remains a powerful element as it must be carefully

watch and incorporated into an organisation values and products, to gain acceptance. The

management of Parker Pen Company, neglected local cultures, and values with their

quest of one marketing campaign centrally planned in their head office.

Schultz et al. (1993), (1998) proposed that any model of marketing communication

should analyse what happens with the customer rather than starting with the marketer. By

doing so, they argued that communication mix is developed on the basis of (actual,

'natural') customer activity in relation to the brand and not (necessary) marketer activity

in relation to the brand. This is the secret behind Coca-Cola marketing mix and other

leading brands. However, Coca Cola product mix is standardize where as that of Parker

Pen Company is not. This is the company made the biggest communication Backslash.

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1.3 Marketing Miscalculations made by the advocates of Globalization at Parker Pen For the greatest communication impact, Kotler (2003) argued that the entire marketing

mix (promotion, product, price, and place) must be carefully coordinated for greatest

success. This is so because, the product designs, the price, the shape and colour of its

package and others within the chain communicate something to buyers. Thus, for

consistency and uniformity all these aspects of marketing should be integrated. However,

integration of marketing is not about neglecting local values and customs, it is not about

one size fit all, but is about making use of the traditional four Ps for consistency and

uniformity.

Integration of marketing communication activities can avoid confusion and disaffection

in the minds of consumers and buyers, offering a comfortable identity to customers and

staff. Agencies who support the marketing communication process can take a more

holistic and thus strategic stance to their client's business, concentrating on strategic

development rather than separate agendas to get a strategic fit (Kitchen. P., 1993).This is

the primary function of e-marketing communication in integrated marketing

communication.

For example, Kotabe & Helson (2004) stipulated that, an organisation language of

business may be English; this organisation must have to do business in French language

if it intends to appeal to the French consumers and the cultural conditions in France had

to be accounted for as well. For example the French market preferred a stylish luxury

pens while the Scandinavia market preferred cheap ball pens. The company failed in its

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positioning and market segmentation as well. The company recognizes that markets

around the world consist of similarities and differences and that it is possible to develop a

global strategy from similarities and not differences.

1.4 Miscalculations of the Product Policy Kotabe & Helson (2004) state that, in international marketing campaign no one step is as

important as environmental factors (Kotabe & Helson 2004). These researchers stated

that, in international marketing, taking into consideration of the cultural economic and

political differences between countries when designing marketing campaigns. Parker Pen

Company products were not designed in relation to different markets. The company

failed to develop and market disposable pen, some markets such as the French and Italian

Market fancied expensive fountain pens, while Scandinavia was a ballpen market. Had

the management and marketing department, taken local and environmental factors into

consideration they would have cluster their markets according to similarities and

differences using the uncontrollable factors such as culture.

Strategies of an organization should well be able to detail themselves as per the

needs of the environment while planning for the future. Today, business

environment has increasingly become more turbulent, chaotic and challenging than ever

before. To survive, it is vital that a firm can do something better than its competitors.

Globalisation has not only altered the nature and the intensity of competition but has had

to dictate and shape organisations in terms of what consumers wants, how and when they

want it and what they are prepared to pay for it.

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1.5Miscalculations of the Target Segment According to Peter (2007), a market segment consists of individuals, groups or

organizations with one or more characteristics that cause them to have relatively similar

product needs (Sommers & Barnes 2004). Markets are partitioned with respect to

potential customers. The management of Parker Pen Company can segment it market in

any of the following ways; Geographic, Demographic, psychographic and behavioralistic.

However, with its global strategy they neglected segmenting the market using

behavioural and psychographic characteristics. The markets were segmented not in

relation to product variables, such as usage rates, and features desired by the local

markets. The management aught to have place products on a continuum or

environmental sensitivity.

1.6Miscalculations of Competitors Competition in the quality writing instruments was fierce. In international marketing, to

segment the market properly, management need information such as population size.

Because of regional differences in consumer’s preferences, this kind of segmentation will

provide the basis for geographic specialization (Sommers & Barnes 2004). The market

could also be segmented into north, south, west and East Europe, with others taking care

of the rest of the world.

Sommers & Barnes (2004) stipulated that, behavioral segmentation is focused on actual

customer behavior toward products. Behavioralistic variables include; usage rate, benefits

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sought, brand loyalty, user status, readiness to buy. This method of market segmentation

has been largely applauded because of its advantage of using variables that are closely

related to the product itself. In addition, it is a fairly direct starting point for market

segmentation. Thus, within each of the existing divisions customers and would be

customers could be classified within these characteristics. Most competitive firm in the

industry positioned their product with respect to this market segmentation, and

responding to environmental factors.

1.7Was the globalization strategy sounds for writing instruments? The globalization strategy adopted by the company’s management was not the best. It

was like doing the right thing at the wrong place. Pens were basically the same, but

markets were different. Unlike other global brands with standardize features, the Parker

Pen brand was difficult to standardize globally, but would have been possible to do so

with respect to different market. In the absence of global and standardize features in its

product, the company aught to have standardize its product and strategies with respect to

local markets.

Recent shift and development in the business world in general and marketing in particular

has pushed the marketing strategy from mass marketing to target or one-on-one

marketing and narrow casting (Simmons., 2007, Schultz and Schultz., 1998, Varey.,

2001). Advances in information technology have further made things complicated for

companies as they strive to embrace it (Philip K., & Patrick P., 2003).E-communications

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is increasingly becoming a vital part of the marketing communication mixes as the “Wait

& See” are now embracing it.

Should the merits of global marketing be judged by what happened at Parker Pen Company? Parker Pen Company needs to be a strict and contingent marketing plan in order to

compete in the industry which can well be adjudicated with the help of three

interrelated tasks which are-marketing objectives, selection of the target market,

and developing the market mix (Peter et. al, 2007). Recognition of an opportunity

marks the advent of planning of an appropriate strategic approach by the

marketing executive in order to efficiently benefit the advantage of the

opportunity. For an efficient marketing plan, the company needs to define the

market potential and opportunities should be prioritized. It is preferable to analyze

the risks and problems associated with it and then operate according to the

management growth by considering each and every facet of the market. Marketing

planning is not as intricate as it seems to be. One should well be able to

critically think about the strategy to be enforced while clarifying every target and

goals to be achieved (Marketing Plan Software, 2008). The management,

implemented global marketing strategies, failing to recognize local values and culture as

such the values of global marketing couldn’t be captured by the organisation.

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2.0Ten Minutes Key Point Presentation of the case, This paper focuses on the case of Parker Pen Company. The first part of the paper

provides an overview of the case and the nature of the marketing and communication

techniques used by the company, the second part of the paper focuses on some of the

miscalculations the company did, that cost them a fortune. The last part of the paper

provides the conclusion and recommendation.

The case Parker Pen Company focuses on a key player in the writing industry. It main

activities include the manufacturing of writing instruments and are one of the world’s

best known companies in the domain. As a global company, its products are sold in 154

countries and the company considered itself number one in 'quality writing instruments'.

Things didn’t work out and remain the way the company had thought and plan as its

global marketing and communicating strategies designed and planed at the headquarters

cost the company a fortune. The company failed and made huge marketing and product

positioning mistakes, they neglected local values and cultures and in all management

failed to recognize that, as other one size fit all brands like coca cola, Parker Pen

Company with its quality writing instruments cannot be matched and placed in the same

domain.

The global marketing strategy implemented by the company’s marketing department was

a misfit, as subsequent action taken by the company to address the situation cost them a

fortune. Part of the business was sold, and subsequently higher cost, made matter worst

for management.

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2.1Conclusion and Recommendation

Strategic advantages are not always achieved by competition alone. Collaboration

between potential buyers and sellers and some other dealers turn to be very beneficial and

advantageous when negotiation and contracting costs reduces (JSW: 2005:261). I believe

by developing and capitalizing on its service minded employees and reliable service, the

company stands a better chance to sail through the five forces framework. The company

should increasing used partners worldwide to benefit from generic focus and cost

leadership strategy. By working with partners in different locations, Parker Pen can gain

lasting competitive advantage over its competitors. Because of synergistic gains resulting

from such partnership, the company as a whole is greater than the sum of its parts.

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References: Brennan, R., Baines, P and Garneau, p (2003) Contemporary Strategic Marketing, Palgrave (chapter 10 on e-marketing to be issued in class) Integrated marketing communications: a primer / Philip Kitchen and Patrick de Pelsmacker. Chapter 8 of this book is the one you require. Johnson V and Peppas, S C (2003) Crisis management in Belgium : the case of Coca-Cola, Corporate Communications, An International Journal, Vol 8, No 1, pp 18 – 22 Kitchen, P. (1993) 'Marketing communications renaissance', International Journal of Advertising, 12: 367-86. Kortler, P. A framework of Marketing Management. 2nd ed. Published by Pearson education, Inc. 2002

Kortler, P. (1996) Principles of Marketing, 2nd European edn, London: Prentice-Hall, case study no. 19. Helson, K., & Kotabe, M., (2004). Global Marketing Management 3rd Edition Rowley J (2004) Just another channel? Marketing Communications in e-business, Marketing Intelligence and Planning, Vol 22, no 1 Schultz D E and Schultz H F (1998) Transitioning marketing communication into the twenty first century Journal of Marketing Communication, vol 4, 9-26

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Schultz, D. E., Tannenbaum, S. I., and Lauterborn, R. F. (1993) Integrated Marketing Communications: Putting It Together and Making It Work, Lincolnwood, IL: NTC Business Books. Simmons, G.J. (2007) “i-branding: developing the internet as a branding tool”, Marketing Intelligence and Planning, Vol. 25, No. 6, pp 544 – 562. Varey, J. R., (2001). Marketing Communication: Principles and Practice. Routledge Publications Zineldin M and Philipson S (2007) “Kotler and Borden are not dead: the myth of relationship marketing and truth of the 4P’s”, Journal of Consumer Marketing, Vol, 24. No, 4, pp 229 – 241